IA Financial Assistance

Granted, most companies would look out over the Iowa horizon and just see crops. But entrepreneurs with vision see something more. Opportunity. Entrepreneurs see an economy that breeds innovation—and a state that is ready to provide the assistance start ups need to succeed. Small business is BIG business in Iowa. 97.2% of Iowa’s employers are small businesses according to the federal definition. Whether you are starting a business or expanding your operations, you‘ll find the right resources in Iowa! Iowa offers a variety of avenues for financial assistance options to assist with relocations and expansions to locations within Iowa. Assistance is provided in the form of loans and/or forgivable loans, based in part on job creation, capital investment, the ability to meet certain wage standards, quality of employment, and economic benefits for the state and local community.

 

Tax Credits

Angel Investor Tax Credits

Angel Investor tax credits are offered to increase the availability and accessibility of venture capital, particularly for ventures at the seed capital investment stage. Two programs – theQualifying Business tax credit and the Community-Based Seed Capital Fund tax credits – work together to encourage the creation of wealth through high-paid, new jobs while promoting industrial development and innovation. The total amount of tax credits available per fiscal year is $2 million.

 

Community Based Seed Capital Funds Tax Credit

The Investments in Community-Based Seed Capital Funds tax credits, along with the Qualifying Businesses Tax Credits, were created to enhance the quality of life for citizens of Iowa by increasing the availability and accessibility of venture capital, particularly for ventures at the seed capital investment stage, thereby encouraging the creation of wealth through high-paid, new jobs while promoting industrial development and innovation.

 

Qualifying Business Tax Credit

The Qualifying Business tax credit program is designed to encourage venture capital investment at the seed capital stage. The total amount of tax credits available to be issued for investments in Qualifying Businesses and Community-Based Seed Capital Funds (Angel Investor Tax Credits) is $2 million per fiscal year.

 

Innovation Fund Tax Credit Program

The Innovation Fund Tax Credit program was created to stimulate venture capital investment in innovative Iowa businesses. Individual investors can receive tax credits equal to 25 percent of an equity investment in a certified Innovation Fund. In turn, those certified Innovation Funds make investments in promising early-stage companies that have a principal place of business in the state of Iowa.

 

New Jobs Tax Credit

The Iowa New Jobs Tax Credit is an Iowa corporate income tax credit and is available to a company that has entered into a New Jobs Training Agreement (260E) and expands their Iowa employment base by ten percent or more.

 

Research Activities Credit

Iowa sets itself apart, being one of only a few states to offer a refundable research activities credit. Iowa companies earn refundable tax credits for research and development investments that may be paid directly in cash to the company once its tax liabilities have been met. A company must meet the qualifications of the Federal Research Activities Credit in order to be eligible for the credit in Iowa.

 

Targeted Jobs Withholding Tax Credit Pilot Program

The Targeted Jobs Withholding Tax Credit Pilot Program is a pilot program enacted in 2006 which allows the diversion of withholding funds paid by an employer to be matched by a designated “pilot” city to create economic incentives that can be directed toward the growth and expansion of targeted businesses located within a pilot city.

 

For more information on Iowa Financial Assistance visit: Iowa Economic Development Authority