SECTION 1. Section 6 of chapter 62 of the General Laws, as appearing in the 2014 Official Edition, is hereby amended by inserting after subsection (s) the following new subsection:-

(t) (1) As used in this subsection, the following words shall have the following meanings:-

“Angel investor”, a taxpayer who provides financing for the development, refinement, and commercialization of a product or process and other working capital needs.

“Small business”, a business entity physically located in Massachusetts and employing fewer than 100 workers; provided, that not less than 51 per cent of the workers are residents of Massachusetts.

“Start-up expenses”, the expenses for the administration and operation of a business prior to the time the business becomes operational.

(2) An angel investor shall be allowed a credit against the taxes imposed by this chapter equal to 15 per cent of the monetary amount provided to a small business for the start-up expenses associated with the small business; provided, the credit shall be equal to 25 per cent if the small business is physically located in an economic target area pursuant to section 3D of chapter 23A. 

(3) Any amount of the credit that exceeds the tax due for a taxable year may be carried forward by the taxpayer to any of the 3 subsequent taxable years.

(4) The total cumulative amount of credits issued in a calendar year pursuant to this subsection shall not exceed an annual cap equal to not less than $5,000,000 nor more than $10,000,000.

(A) Funding for the credit shall be from any remaining amount of consolidated net surplus after complying with clause (a) of section 5C of chapter 29. 

(5) The credit authorized in this subsection shall expire on December 31, 2021.

(6) The commissioner shall promulgate regulations necessary for the administration of this subsection.