EDA Accepting Applications for 2018 NOL Program
May 14, 2018
Technology and life sciences companies in the Garden State seeking to raise non-dilutive capital can now apply to the state's 2018 Technology Business Tax Certificate Transfer (NOL) Program. Applications are being accepted online through June 30 at njeda.com/nol.
Heralded as a lifeline for unprofitable companies, the NOL Program enables eligible technology and life-sciences companies to sell New Jersey net operating losses and unused research and development (R&D) tax credits to unrelated profitable corporations for cash, which can be used for working capital or to fund research. The New Jersey Economic Development Authority (EDA) and the New Jersey Department of Treasury’s Division of Taxation administer the program.
Program benefits include the following:
- Emerging companies can use the funding they receive as working capital, and the businesses to which they sell are able to lower their tax burden.
- The funding is non-dilutive, meaning that entrepreneurs do not have to give up equity in their companies to receive the money.
- The average historical award is over $1 million.
- Nearly 90 percent of applicants successfully receive funding.
- On average, funding is received within six months of applying.
Since the program was established in 1999, more than 525 businesses have been approved for awards totaling over $950 million. Last year, 39 companies were approved to share more than $46 million.
Companies must apply online by June 30 in order to participate. To sell net operating losses or R&D tax credits generated in 2017, companies must file their corporate business tax returns with the NJ Division of Taxation by June 30, 2018. Applicants can expect to hear by the end of August if their applications are approved.
For more information on the NOL Program, including frequently asked questions, a complete list of eligibility requirements, and program details, please visit njeda.com/nol.