Investors will have more time to claim tax breaks for their investments in startups. This year’s tax package extended the deadline for the state of New Mexico’s Angel Investment Credit to 2030. Investors can get back up to 25% of their investment, up to a maximum of $62,500, for investments made before 2031. Angel investors provide capital to startup companies to help them get started. The tax break is intended to encourage investment in New Mexico and spur economic growth. In a July opinion piece, New Mexico Angels President Drew Tulchin and board member David Perez emphasized that this package of measures will help the state attract and retain more investment in startups. “A package that includes tax breaks, investment capital and technical assistance will help not only attract companies, but also keep them here for the long term,” they wrote. The Angel Investment Credit was originally set to expire at the end of 2025, but lawmakers have ensured that the deadline has now been extended. ### How it works The tax credit is deducted from the investor’s income tax liability. Any unused portion of the credit can be carried forward for five years. Taxpayers may only claim the credit once per investment round and can claim the credit for up to five companies in a tax year. Investors must apply for the credit within one year of the end of the calendar year in which they made the investment. Companies must also apply before investors can do so. The total annual angel investment credit amount is $2 million and is awarded on a first-come, first-serve basis. If an investor misses the credit because they reach the annual limit, they can apply again the following year. Applications for the credit can be submitted by companies and investors to the New Mexico Taxation and Revenue Department using Form TRD-41404.
