The bill repeals the Colorado innovation investment tax credit and replaces it with the advanced industry investment tax credit (tax credit). The tax credit is available for a qualified investor who, prior to January 1, 2018, makes an equity investment in a qualified small business from the advanced industries, which consists of advanced manufacturing, aerospace, bioscience, electronics, energy and natural resources, information technology, and infrastructure engineering. The tax credit is equal to 25% of the investment or, if the qualified business is located in a rural area or economically distressed area, it is equal to 30%. The maximum amount of credit for a single tax credit is $50,000, and the maximum of all tax credits allowed for a calendar year is $2 million; except that unused tax credits from 2014 may roll over into 2015. A tax credit may not be refunded, but it may be carried forward for 5 tax years.
The Colorado office of economic development (office) determines the eligibility for the tax credit and issues nontransferable tax credit certificates as evidence of eligibility and the amount of the tax credit. To claim the tax credit, a taxpayer must submit a copy of the tax credit certificate. The office and the department of revenue are required to share information related to the tax credit. In 2017, the office is required to submit to legislative committees a report that includes information about the tax credits issued and the economic benefits from the related qualified investments.
The state treasurer is required to transfer moneys from the repealed innovation investment tax credit cash fund to the newly created advanced industry investment tax credit cash fund. The general assembly shall appropriate any moneys in the fund to the office for the direct and indirect costs associated with the authorizing tax credits.