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KANSAS ANGEL INVESTOR TAX CREDIT

The KAITC Program is administered by the Kansas Department of Commerce and designed to bring together accredited angel investors with qualified Kansas companies seeking seed and early stage investment.

EFFECTIVE 2019 – PLEASE READ!!

The following policies for the Kansas Angel Investors Tax Credit (KAITC) Program will be effective for 2019:

  • 2019 KAITC Applications may be submitted online beginning February 1, 2019 and will not be accepted after August 31, 2019.
  • Investment made to a qualified Kansas business prior to written approval of award of tax credits by Commerce will NOT be eligible for tax credits.
  • An LLC or any other permitted entity investor must provide documentation that demonstrates it was established and is operated for the sole purpose of making investments in other entities per K.S.A. 74-8132(g).
  • Investment through multiple permitted entities (e.g. LLC-1 to LLC-2 to qualified Kansas business) will not be allowed.
  • All of the equity owners of the permitted entity investor must be accredited investors.
  • The qualified Kansas business must maintain its headquarters and qualifying operations in Kansas for a minimum period of ten (10) years as required by KSA 74-8136(g) and an agreement between the qualified Kansas business and Commerce must be signed prior to issuance of tax credits.
  • Nonrefundable application and registration fees will be assessed beginning in 2016 per K.S.A. 74-8133(f).
  • Applications and tax credit certificate issuance requests will not be processed until the associated fees are received by Commerce.

The fee schedule for 2019 is as follows:

  • $250 application fee (assessed to companies that apply for designation as a qualified Kansas business)
  • $150 registration fee (assessed to investors or the transferees of investors requesting the issuance of Kansas tax credit certificates)
  • $50 certificate replacement fee (assessed to investors or the transferees of investors requesting a certified copy of a lost Kansas tax credit certificate)

KAITC program fees can be paid: online by Credit Card*, Debit Card*, or ACH** (click here and select the applicable fee(s) to make an online fee payment); or by mailing a paper check to the Kansas Department of Commerce (click here to download the paper check fee payment form).

*A 2.5% service fee will be applied to online Credit and Debit Card payments (2.5% of the total charge)

 **A $1.50 service fee will be applied to online ACH payments

Under the Kansas Angel Investor Tax Act, as codified at K.S.A. 74-8131 — K.S.A. 74-8137, effective January 1, 2005 as amended, an accredited investor is allowed a 50% tax credit on their cash investment of up to $50,000, in a certified Kansas business. Additionally, for each tax year, an Angel Investor shall not be entitled to claim tax credits under this Act for more than $250,000.

“Angel Investor” and “Investor” mean an accredited investor who is a natural person or an owner of a permitted entity investor, who is of high net worth, as defined in 17 C.F.R. § 230.501(a) as in effect on the effective date of this act, and who seeks high returns through private investments in start-up companies and may seek active involvement in business, such as consulting and mentoring the entrepreneur.

“Permitted Entity Investor” means (A) any general partnership, limited partnership, corporation that has in effect a valid election to be taxed as an S corporation under the United States internal revenue code, or a limited liability company that has elected to be taxed as a partnership under the United States internal revenue code and (B) that was established and is operated for the sole purpose of making investments in other entities.

For the purposes of this act, a person who serves as an executive, officer, employee, vendor or independent contractor of the business in which an otherwise qualified cash investment is made is not an angel investor and such person shall not qualify for the issuance of tax credits for such investment.

Accredited angel investors must register as such to be eligible for the Kansas Angel Tax Credit in the Angel Investors section of this web site.

Contact Us

Rachéll Rowand Program Manager Email (785) 296-3345 LinkedIn

Wendi Lucero Public Service Administrator Email (785) 296-6007 LinkedIn

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