Technology Business Tax Certificate Transfer (NOL) Program
As per issuance of an Executive Order, the Technology Business Tax Certificate Transfer (NOL) Program submission deadline has been extended from 6/30/2020 to 9/30/2020. Accordingly, the 2020 program application can be found here https://application.njeda.com/.
The Technology Business Tax Certificate Transfer Program enables qualified, unprofitable NJ-based technology or biotechnology companies with fewer than 225 US employees (including parent company and all subsidiaries) to sell a percentage of net operating losses (NOL) and research and development (R&D) tax credits to unrelated profitable corporations.
Dollar Amount Net operating losses and R&D tax credits may be sold for at least 80% of their value, up to a maximum lifetime benefit of $15 million per business
Uses Growth and operations, including working capital or to fund research
Benefits Ability to turn NOL and R&D tax credits into capital
Eligibility See “Program Details” below
Up to $60 million is available annually, with $10 million set aside for businesses located in Innovation Zones (any unused balance of the $10 million set-aside is reverted to the general program pool)
Only technology and biotechnology companies whose primary business involves the provision of a scientific process, product or service are eligible
An eligible company must own, have filed for, or have a license to use protected, proprietary intellectual property (defined as a patent or a registered copyright)
An eligible company cannot have had positive net operating income on either of its last two full-year income statements according to GAAP. In addition, an eligible company cannot have a parent company with positive net operating income, or be part of a consolidated group of affiliates for federal income tax purposes with positive net operating income
An eligible company must have at least one full-time employee working in New Jersey if incorporated or formed less than three years, five full-time employees in New Jersey if incorporated or formed more than three years but less than five years, or 10 full-time employees in New Jersey if incorporated or formed more than five years
An eligible company must have financial statements for the two most recent full years of operation compiled, reviewed or audited by an independent CPA firm and prepared according to US GAAP.
Application fee: $2,500
**All fees are non-refundable
APPLICATION DEADLINE: Wednesday, September 30th, 2020 11:59 pm
Application and application fee must be submitted via the online application. No other form of application and payment will be accepted for entry into the program. NJEDA must receive completed application by the deadline. The application will not be considered submitted until you receive the confirmation message at the end of the application. Please retain this confirmation in the event that it is needed. A link to the online application is below.
NJ CORPORATE BUSINESS TAX RETURN DEADLINE: The Applicant Company’s Corporate Business Tax returns, with all required schedules and attachments, must be filed with the NJ Division of Taxation by the application deadline (above). Failure to file by the program deadline will result in the Applicant Company having no available tax benefit for the current program year. PROGRAM VIDEO PRESENTATIONS: Please click here to view an overview presentation of the program. PROGRAM LINKS:
Sample Online Application (for illustrative purposes only - see application link below to apply)
List of Required Documents (these items must be attached in the online application, if applicable)
Benefit Estimator (for estimate purposes only)
* Any proposed amendments to the program rules can be found on the Proposed New Rules/Amendments page
If this does not answer your questions, please email your questions and contact information to NOL@NJEDA.COM.
All emailed questions and their responses are considered public knowledge. The questions and responses are reviewed by the Deputy Attorney General's Office and posted in the program's "Frequently Asked Questions".