SB 563

Current law allows an individual to claim an income tax credit equal to 25 percent of the individual’s bona fide angel investment in a qualified new business venture certified by the Wisconsin Economic Development Corporation. “Bona fide angel investment” is defined as the purchase of an equity interest or any other expenditure, as determined by rule. This bill modifies that definition to include a convertible instrument such as a convertible note or a simple agreement for future equity.

Current law allows a person to claim the early stage seed investment tax credit equal to 25 percent of the person’s investment paid to a fund manager that the fund manager invests in a qualified new business venture certified by WEDC. Under the bill, “investment” is defined as a purchase of an equity interest, a convertible instrument such as a convertible note or a simple agreement for future equity, or any other expenditure, as determined by WEDC.