Eligibility
This program sunset on June 30, 2026 and we are currently not accepting new applications.
The incentive is available to Louisiana businesses that are primarily engaged in energy and process industries, logistics, aerospace and defense, agribusiness, professional services, life sciences, or technology.
A qualified investment may be in the form of equity, convertible debt, or other types of subordinate debt as approved by the department. Subordinate debt by its terms requires no repayment of principal for the first 3 years after issuance, is not guaranteed by any other person or secured by any assets of the LEB or any other person and is subordinated to all indebtedness and obligations of the LEB to its general creditors. The no repayment requirement for the first 3 years must be clearly indicated in each promissory note or convertible note agreement for all debt instruments.
Qualifying uses of investment funds include: Capital improvements, plant equipment, research & development and working capital
Non-eligible uses of investment funds include: Pay dividends, redeem shares, repay debt and repay shareholders’ loans
What qualifies as an LEB? The principal business operations are in Louisiana, with Louisiana as the primary place of employment for the employees of the business. The business must possess a fully developed business plan that includes all appropriate long and short term forecasts and contingencies of business operations, including research and development, profit, loss and cash flow projections, and details of expenditure of angel investor funding. The business must have a Louisiana Tax Identification Number. The business has either gross annual sales of less than $10 million or a business net worth of less than $2 million. The business employs 50 or fewer full-time employees. The business must demonstrate that it will create quality jobs in the state. The business is not primarily engaged in the business of retail sales, real estate, professional services, gaming or gambling, natural resource extraction or exploration, or financial services including venture capital funds. The business has a plan of progression through which more than 50% of its sales will be derived from outside of Louisiana.
Who qualifies as an Accredited Investor? An Accredited Investor shall meet the definition established by Rule 501 in Regulation D promulgated under the Securities Act of 1933.
Program Statutes and Rules:
All incentive program rules are in the Louisiana Administrative Code maintained by the Office of the State Register.
- View the Angel Investor Tax Credit Statutes
- View the Angel Investor Tax Credit Rules (Go to Part 1, Chapter 33)
Eligibility Scenarios
I have an angel investor that invested funds in my company earlier this year, before I became aware of the AITC Program. Can this angel investor take advantage of the AITC with the investments he made in my business earlier this year?
The investment must have been made before the 120-day proof of investment period lapsed, and no earlier than 30 days prior to the reservation of credits.
I am negotiating with a group of angel investors for a round of funding in my business. How do I know if they will qualify to receive tax credits under the AITC Program?
If the individuals that comprise the angel pool meet the net worth and income requirements for accredited investors associated with the Securities Act of 1933, they should qualify for the tax credits.
Angel Investor FAQs
Since the AITC is a state program, can out-of-state investors benefit from the program?
AITC tax credits can only be applied against Louisiana state tax liabilities. An out-of-state investor could benefit by transferring the AITC to a Louisiana taxpayer.
How many years must an investment be maintained in the LEB?
Three years.
When will the AITC become deductible from an investor's tax liability?
The tax credit available in the first year shall become deductible from tax liability in the taxpayers income tax year which occurs twenty-four (24) months from the date LED certifies the amount of the investment.
Are AITC applications, business plans, financial statements, etc, subject to a Public Records Request?
Yes. The company has the burden of defending against a Public Records Request in court. LED will notify the business of such a request.
What documents must be submitted as proof of investment?
The LEB must submit a subscription agreement as required by the Securities and Exchange Commission as proof of investment, in addition to copies of canceled checks and bank wire transfers as proof of funds transfer.