The Ohio Department of Development, (DOD), in collaboration with the Ohio Department of Taxation, recently launched InvestOhio, a $100 million tax credit program designed to help eligible small businesses get needed funds from investors to grow, succeed, and create jobs. The effort is expected to generate $1 billion in new investments in Ohio small businesses by 2013.
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“Valuable capital has been sitting on the sidelines far too long,” said DOD Director Christiane Schmenk. “InvestOhio helps get these dollars into the game to help Ohio's small businesses take advantage of the emerging economic recovery.”
InvestOhio offers a 10 percent income tax credit for investments of up to $10 million in eligible small businesses. The investor must purchase an ownership interest in the business and keep it for at least 2 years. The business must reinvest the funds within 6 months into one of five categories of allowable expenses:
- tangible personal property
- motor vehicles
- real property
- intangible personal property used in business primarily in Ohio
- compensation for newly-hired or retained employees who are subject to Ohio income tax withholding.
The business must retain the property purchased through the investment for at least 2 years.
To qualify, a business must have less than $50 million in assets or less than $10 million in annual sales. The business must also employ 50 full-time-equivalent employees in Ohio or employ at least 50 percent of its workforce within the state, and must withhold Ohio income taxes for those workers.
The Director of Development is authorized to award up to $100 million in tax credits during the current State of Ohio fiscal biennium, which ends on June 30, 2013. Applications are accepted on a first-come, first-served basis, so businesses should apply early.
The program opened for applications on December 5, 2011. For more information, visit the InvestOhio page on Ohio.gov.