Early stage business investment program
Wis. Stat. § 238.15
in effect(1) Angel investment tax credits. The corporation shall implement a program to certify businesses for purposes of s. 71.07 (5d). A business desiring certification shall submit an application to the corporation in each taxable year for which the business desires certification. The business shall specify in its application the investment amount it wishes to raise and the corporation may certify the business and determine the amount that qualifies for purposes of s. 71.07 (5d). The corporation may certify or recertify a business for purposes of s. 71.07 (5d) only if the business satisfies all of the following conditions:
(a) It has its headquarters in this state.
(b) At least 51 percent of the employees employed by the business are employed in this state, except that if a business fails to satisfy this paragraph in any year due to a business merger or acquisition, the corporation may grant the business a waiver that allows the business to remain eligible for certification or recertification under this subsection if all of the following apply:
1. The business maintains its headquarters in this state.
2. After the merger or acquisition, the business increases the number of employees the business employs in this state.
3. The corporation determines that the merger or acquisition was not for the purpose of relocating the business’s operations or employees from this state to another state or for the purpose of ceasing the business’s efforts to further grow and expand in this state.
4. No later than the first day of the 13th month beginning after the date of the merger or acquisition, at least 51 percent of the employees employed by the business are employed in this state.
(f) It has the potential for increasing jobs in this state, increasing capital investment in this state, or both, and any of the following apply:
1m. It is engaged in, or has committed to engage in, innovation, if the innovation involves the development of a differentiating technology, product, service, or production process.
2. It is undertaking pre-commercialization activity related to differentiating technology that includes conducting research, developing a new product or business process, or developing a service that is principally reliant on applying differentiating technology.
(g) It is not primarily engaged in real estate development, insurance, banking, lending, lobbying, political consulting, professional services provided by attorneys, accountants, business consultants, physicians, or health care consultants, wholesale or retail trade, leisure, hospitality, transportation, or construction, except construction of power production plants that derive energy from a renewable resource, as defined in s. 196.378 (1) (h).
(h) At the time it is initially certified under this subsection, it has less than 100 employees.
(j) At the time it is initially certified under this subsection, it has been in operation in this state for not more than 10 consecutive years.
(k) For taxable years beginning before January 1, 2008, it has not received more than $1,000,000 in investments that have qualified for tax credits under s. 71.07 (5d).
(km) It has not received aggregate private equity investment in cash of more than $10,000,000 before it is initially certified under this subsection.
(kn) For taxable years beginning after December 31, 2007 and before January 1, 2011, it has not received more than $4,000,000 in investments that have qualified for tax credits under ss. 71.07 (5b) and (5d), 71.28 (5b), 71.47 (5b), and 76.638.
(L) For taxable years beginning after December 31, 2010 and before January 1, 2018, it has not received more than $8,000,000 in investments that have qualified for tax credits under ss. 71.07 (5b) and (5d), 71.28 (5b), 71.47 (5b), and 76.638.
(Lg) For taxable years beginning after December 31, 2017, it has not received more than $12,000,000 in investments that have qualified for tax credits under ss. 71.07 (5b) and (5d), 71.28 (5b), 71.47 (5b), and 76.638.
(m)
1. It agrees that it will not relocate outside of this state during the 3 years after it receives an investment for which a person may claim a tax credit under s. 71.07 (5d) and agrees to pay the corporation a penalty, in an amount determined under subd. 2., if the business relocates outside of this state during that 3-year period. For the purposes of this paragraph, except as provided in policies and procedures under sub. (3) (dm), a business relocates outside of this state when the business locates more than 51 percent of any of the following outside of this state:
a. The business’s employees.
b. The business’s total payroll.
c. The activities of the business’s headquarters, as determined by the corporation.
2. The amount of a penalty payment under subd. 1. is any of the following:
a. If the relocation occurs less than 12 months after the investment, 100 percent of the tax credit that was claimed under s. 71.07 (5d) as the result of the investment.
b. If the relocation occurs 12 months or more after the investment but less than 24 months after the investment, 80 percent of the tax credit that was claimed under s. 71.07 (5d) as the result of the investment.
c. If the relocation occurs 24 months or more after the investment but less than 36 months after the investment, 60 percent of the tax credit that was claimed under s. 71.07 (5d) as the result of the investment.
3. Subdivision 1. does not apply to a business that the corporation certified for purposes of s. 71.07 (5d) before April 20, 2012, and that, in reliance on that certification, executed a note or bond that is convertible to an equity interest.
(2) Early stage seed investment tax credits. The corporation shall implement a program to certify investment fund managers for purposes of ss. 71.07 (5b), 71.28 (5b), 71.47 (5b), and 76.638. An investment fund manager desiring certification shall submit an application to the corporation. The investment fund manager shall specify in the application the investment amount that the manager wishes to raise and the corporation may certify the manager and determine the amount that qualifies for purposes of ss. 71.07 (5b), 71.28 (5b), 71.47 (5b), and 76.638. In determining whether to certify an investment fund manager, the corporation shall consider the investment fund manager’s experience in managing venture capital funds, the past performance of investment funds managed by the applicant, the expected level of investment in the investment fund to be managed by the applicant, and any other relevant factors. The corporation may certify only investment fund managers that commit to consider placing investments in businesses certified under sub. (1).
(3) Administration.
(a) List of certified businesses and investment fund managers. The corporation shall maintain a list of businesses certified under sub. (1) and investment fund managers certified under sub. (2) and shall permit public access to the lists through the corporation’s Internet website.
(d) Administration. The corporation, in consultation with the department of revenue, shall establish policies and procedures to administer this section and shall further define “bona fide angel investment” for purposes of s. 71.07 (5d) (a) 1. The aggregate amount of tax credits under s. 71.07 (5d) that may be claimed for investments in businesses certified under sub. (1) and of tax credits under ss. 71.07 (5b), 71.28 (5b), 71.47 (5b), and 76.638 that may be claimed for investments paid to fund managers certified under sub. (2) is $30,000,000 per calendar year. The policies and procedures shall provide that a person who receives a credit under s. 71.07 (5b) or (5d), 71.28 (5b), 71.47 (5b), or 76.638 must keep the investment in a certified business, or with a certified fund manager, for no less than 3 years, unless the person’s investment becomes worthless, as determined by the corporation, during the 3-year period or the person has kept the investment for no less than 12 months and a bona fide liquidity event, as determined by the corporation, occurs during the 3-year period.
(dm) The corporation’s policies and procedures under this subsection shall provide that a business is considered to have not relocated outside of this state under sub. (1) (m) 1., regardless of whether the business satisfies sub. (1) (m) 1. a. and b., if the corporation determines that the business’s investment and employment levels in this state have not diminished.
(e) Transfer. A person who is eligible to claim a credit under s. 71.07 (5b), 71.28 (5b), 71.47 (5b), or 76.638 may sell or otherwise transfer the credit to another person who is subject to the taxes or fees imposed under s. 71.02, 71.23, 71.47, or subch. III of ch. 76, if the person receives prior authorization from the investment fund manager and the manager then notifies the corporation and the department of revenue of the transfer and submits with the notification a copy of the transfer documents. A person who is eligible to claim a credit under s. 71.07 (5d) may sell or otherwise transfer the credit to another person who is subject to the taxes imposed under s. 71.02 if the person notifies the corporation and the department of revenue of the transfer and submits with the notification a copy of the transfer documents. No person may sell or otherwise transfer an individual credit as provided in this paragraph more than once in a 12-month period. The corporation may charge any person selling or otherwise transferring a credit under this paragraph a fee of up to 5 percent of the credit amount sold or transferred.
(f) Limit on future allocations.
1. Beginning with December 31, 2014, tax credits that the corporation has not allocated under this section on or before December 31 of each year may not be allocated after that date.
2. Subdivision 1. does not apply to an allocation of tax credits occurring after December 31, 2014, and before July 14, 2015.
Source: WI Statutes (Official Site)URL: https://docs.legis.wisconsin.gov/document/statutes/238.15Fetched: 10/7/2026