The New Jersey Economic Development Authority (“NJEDA”) announced that applications are now open through June 30, for the 2025 Technology Business Tax Certificate Transfer Program, commonly known as the Net Operating Loss (NOL) Program.
The NOL program allows early-stage technology and life sciences businesses in New Jersey that are yet to be profitable to sell a percentage of their NJ net operating losses and R&D tax credits to an unrelated profitable corporation for cash. Up to $75 million is available annually, with $15 million set aside for businesses located in Innovation Zones, Opportunity Zones, or NJ Certified as a minority and/or women owned business or enterprise (any unused balance of the $15 million set-aside is reverted to the general program pool).
Taxpayers who participate can use the capital raised through the NOL Program to cover allowable costs incurred in connection with operating their business such as salaries, R&D, and other working capital expenditures.
To be eligible a company must meet the following requirements:
- 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 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 no more than 224 and 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
Over the past few years, Withum’s life science and technology clients have received over $40 million from the program, which will be reinvested in the state, spur innovation and lead to economic growth in New Jersey. Our Life Sciences Services and Technology and Emerging Growth Services Teams serve a diverse client base throughout the state and focus on partnering with them from early stage to maturity. Our expertise in this area strengthens that partnership and puts your business in a Position of Strength.
Contact Us
To learn more about how Withum can help strategically partner with you on the NJ NOL program and other NJEDA initiatives, please contact a member of Withum’s Life Sciences Services Team.
