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The State of Ohio is encouraging investment in small businesses.

With the establishment of the InvestOhio program, $100 million in tax credits are being offered for qualifying investments.

An income tax credit of 10% is being offered on cash investments of up to $10 million. To qualify, the investment must add to an existing business, according to guidelines published by the Ohio Department of Development.

The InvestOhio credits are offered on a first-come, first-served basis, until the program limit of $100 million is reached.

The Program

InvestOhio is a new tool to infuse much needed capital into Ohio's small businesses, helping them create jobs. The program, administered by the Ohio Department of Development in collaboration with the Ohio Department of Taxation, is expected to generate at least $1 billion in new private investment in Ohio small businesses by 2013.

How it Works

InvestOhio provides a non-refundable personal income tax credit to investors that infuse new equity (cash) into Ohio small businesses to acquire an ownership interest in the company. The small business is required to reinvest that infusion of cash into one of five categories of allowable expenses within six months of its receipt. The investor must retain his or her ownership interest for a two year holding period before the tax credit may be claimed. The small business must similarly retain the property that it purchased from the cash infusion for the entire two year holding period.

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.

InvestOhio timeline

1. November 14: program start, registration begins
2. December 6: application acceptance begins
3. June 30, 2013: official end of program
4. $100 million in tax credits: maximum authorization. When this total is reached, regardless of the date, no further credits will be issued.

According to Crain's Cleveland Business: Investors sought $18.4 million in tax credits on Monday, December 6, the first day of business for InvestOhio, the state's new job creation tax credit program.

Links for more information

• How it works: detailed step by step explanation (State of Ohio)
• Frequently Asked Questions (State of Ohio)
• InvestOhio Fact Sheet (State of Ohio)

If you are interested in this program and would like to discuss whether or not this is right for you, please contact Margida & Associates.

Tel: 330-926-0023 | Email: jmargida@margida-assoc.com

3926 Clock Pointe Trail, Suite 102
Stow OH 44224

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