About this programme
The Advanced Industry Investment Tax Credit (AITC) is run by the Colorado Office of Economic Development and International Trade (OEDIT). It encourages third-party investment in Colorado advanced industries by giving the investor, not the company, a state income tax credit.
The mechanism runs in two steps. First, a Colorado business in an advanced industry sector applies to OEDIT to become a certified advanced industry business. Once certified, that status lets the company offer prospective investors a state income tax credit for investing in it.
Advanced industries covered are advanced manufacturing, aerospace, bioscience, electronics, energy and natural resources, infrastructure engineering, and information technology.
How it works
An investor earns a tax credit of 25% of their investment, up to a maximum $100,000 credit, on an investment of $10,000 or more. If the certified business operates in a Colorado enterprise zone or a rural county, the rate rises to 35%, still capped at $100,000.
OEDIT reviews applications in the order received until the annual credit pool is used up: $4,000,000 a year currently, dropping to $2,500,000 starting in calendar year 2027. Once the pool is exhausted, no more credits are issued that year, so a qualifying investment is not guaranteed a credit.
An investor can only earn one tax credit per business, but the same investor can earn credits for investing in several different certified businesses, and multiple investors can each earn a credit for investing in the same business.
AITC certification for a business is valid for 365 days and must be renewed annually; OEDIT recommends filing the recertification application 8 months into the certification period, since processing can take up to 90 days.
A business must monitor its own ongoing eligibility. If it later raises more than $10 million from third parties, or its revenue passes $5 million after 5 full years of revenue generation, it becomes ineligible immediately, and it must notify OEDIT within 30 days. Investments made after that point do not qualify for a credit, and OEDIT can claw back credits already authorized after the ineligibility date as a penalty if the business fails to report the change.
Under House Bill 25-1157, a certified small business that receives a qualified investment must report impact data to OEDIT annually for five years after that investment, and must submit an annual impact report to keep its certification active; reports are due within 45 days of OEDIT's notification email.
Who can apply
Business: must be a corporation, partnership, LLC or similar entity (not an individual), manufacturing an advanced technology and operating in one of Colorado's designated advanced industries.
Business: must be headquartered in Colorado, or have at least 50% of employees based in Colorado (documentation on letterhead, signed by an officer, is required if under 50%). It must be registered and in good standing with the Colorado Secretary of State.
Business: must have received less than $10 million from third-party investors since formation, and must have annual revenue under $5 million or have been generating revenue for less than five years.
Investor: must invest in a business that is already certified before the investment is made, be a third-party or unaffiliated investor with no operational control of the business for 6 months before or after investing, and hold less than 10% of the business on a fully-diluted basis. Founders, employees, contractors and their spouses cannot claim the credit.
Investor: must have previously invested less than $50,000 in the business, must invest at least $10,000 in this round, and the investment must be in common or preferred stock, a partnership or LLC interest, an equity security, a SAFE, or a convertible debt instrument.
Investor: must be an individual, LLC, partnership, S-corp or Trust; C-corps are not eligible investors. The investor must state the tax credit was a significant factor in making the investment, and must not have already claimed a credit for a prior investment in the same business.
How to apply
- Businesses and investors apply separately, and a business should apply as soon as it is considering raising funds, since certification can take up to 90 days.
- Business step 1: complete Investee Pre-certification on the OEDIT application portal (create or log into an account; new accounts are manually activated and can take several days).
- Business step 2: if pre-certification is preliminarily approved, complete the full AI Tax Credit Investee Certification and upload the required documents.
- Investors may only invest and apply for a credit after the business they want to invest in has already been certified.
- Investor step 1: complete the Investor Pre-Qualification on the OEDIT portal to determine preliminary eligibility (account activation can take 1-2 business days).
- Investor step 2: complete the full AI Tax Credit Investor Application, confirming the investment details.
- Submit the completed investor application within 90 days of the investment date; a complete application includes portal activation, the pre-application, and the full application.
Documents you’ll typically need
- Certificate of Good Standing from the Colorado Secretary of State
- Proof of business organization (articles of incorporation, certificate of partnership)
- Most recent year-end balance sheet
- All year-end income statements or income tax filings since formation
- Advanced Industry Tax Credit Investee Worksheet
- Investment term sheet
Frequently asked
How large is the tax credit?
25% of the investment, up to $100,000, or 35% up to $100,000 if the business is in a Colorado enterprise zone or rural county. The investment must be at least $10,000.
Is a tax credit guaranteed once I invest?
No. OEDIT processes applications in the order received until the annual credit pool runs out ($4 million a year now, dropping to $2.5 million from 2027), so a qualifying investment does not guarantee a credit if the pool is already exhausted.
Can a founder or employee claim this credit for investing in their own company?
No. Anyone with operational control of the business in the 6 months before or after investing is excluded, including founders, employees, contractors and their spouses.
Do I need to be certified before I can offer this credit to investors?
Yes. The business must complete OEDIT's certification process, which can take up to 90 days, before an investor's investment can qualify for a credit.
What happens if my company outgrows the eligibility limits?
It becomes immediately ineligible once it raises $10 million or more from third parties, or once its revenue exceeds $5 million after five full years of generating revenue. The company must notify OEDIT within 30 days, and investments made after that point do not qualify.
More funding in Colorado
Advanced Industries Accelerator — Early-Stage Capital and Retention Grant
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Colorado Credit Reserve
Colorado OEDIT, managed by Colorado Housing and Finance Authority (CHFA) · Colorado
A state-backed loan loss reserve that helps Colorado businesses get bank loans up to $500,000 they otherwise would not qualify for.
Colorado Revolving Loan Fund
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All 10 programmes in Colorado →
Reviewed 2026-09-25. Programmes change, so check eligibility, amounts and deadlines on the official page before you apply. CapEasy is a private firm and is not part of any government body.