Cannabis Angel Investors

Cannabis Angel Tax Credit Program

In 2021, Connecticut established the Cannabis Angel Tax Credit Program for qualified angel investors to invest at least $25,000 in a Qualified Cannabis Business (QCB).

The program offers annual tax credits of $15 million for $37.5 million of investments (which is equal to a 40 percent tax credit against a Connecticut tax liability). The program runs from July 1 to June 30 of the fiscal year and expires on June 30, 2028.

To participate in Connecticut’s Cannabis Angel Tax Credit Program, an angel investor or an angel investor network must be an accredited investor as defined in the application. The program excludes venture capitalists, banks, savings and loan associations, trust companies, insurance companies and similar entities whose business activities include venture capital investments, as well as people who control 50 percent or more of the qualified business that will receive the investment.

An investment in a Qualified Cannabis Business (QCB) of $25,000 to $1,250,000 qualifies for a 40 percent credit toward a Connecticut income tax liability. The maximum credit allowed per investor is $500,000. A tax credit must be claimed in the taxable year in which the cash investment is made and may be carried over for five years. An investor may sell, assign or otherwise transfer a credit, in whole or in part.

(See section 133(14) of Connecticut Senate Bill No. 1201) Click Bill No. 1201

Application Process Administered by Connecticut Innovations

The Cannabis Angel Investor Tax Credit Program application process is as follows:

  • Step 1

    Angel investor requests an application to reserve a cannabis tax credit reservation number prior to making any cash investment into a QCB.

  • Step 2

    Angel investor completes application, then signs and submits via Adobe.

  • Step 3

    Upon approval, Connecticut Innovations sends an email to the angel investor and the QCB with the following:

    1. Cannabis Angel Tax Credit Reservation Number
    2. Cannabis Angel Tax Credit Voucher Request Application

    Reservation numbers are issued on a first-come, first-served basis, based on when an application is completed and accepted. The Cannabis Angel Tax Credit reservation number expires 45 days from the time it is issued.

    There is an annual limit to the amount of Cannabis Angel Tax Credits to be issued in a fiscal year.

  • Step 4

    The angel investor and the Qualified Cannabis Business complete the Cannabis Angel Tax Credit Voucher Application after the investment in the QCB is made.

    The application approval process takes 10 to 15 business days.

  • Step 5

    Connecticut Innovations will email the Cannabis Angel Tax Credit Voucher to the Angel Investor and the QCB.

A Qualified Cannabis Business is required to recertify upon the anniversary of its application approval date to remain a Qualified Cannabis Business for the Cannabis Angel Tax Credit Program.

$25,000 / $10,000
$50,000 / $20,000
$100,000 / $40,000
$250,000 / $100,000
$500,000 / $200,000
$1,000,000 / $400,000
$1,250,000 / $500,000

Cannabis Angel Investor Tax Credit Program for Companies

Provides cannabis companies with another way to incentivize angels to invest in their companies.

COMPANIES
Qualified Cannabis Business Application

Interested applicants must complete and execute the Qualified Cannabis Business Application. The application along with all documents requested under Part E of the application and the nonrefundable application fee of $250 must be submitted to Connecticut Innovations, Inc.

REQUEST FOR APPLICATION
Contact Us

Tamyra Davis
tamyra.davis@ctinnovations.com
860.258.7858

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