Governor Murphy Signs Bills to Boost New Jersey's Innovation Economy

Strategic Insights -

Governor Phil Murphy has signed three bills into law that aim to support New Jersey's innovation economy, including measures to increase funding for the New Jersey Innovation Evergreen Act, expand the Angel Investor Tax Credit Act, and create a tax exemption for capital gains from qualified small business stock. The legislation, which took effect on June 30, is expected to drive venture capital, high-quality job growth, and stimulate innovation in the state. Murphy's administration has made strategic investments in entrepreneurs to provide them with the necessary tools and resources to move their businesses forward.

Key Takeaways:

  • The New Jersey Innovation Evergreen Act will now allow for a qualified investment to be a venture firm's second or later investment into a business, if it is larger than the first investment or occurs at a higher valuation than the first investment.
  • The Angel Investor Tax Credit Act will see an increase in the amount of tax credit provided under the program, and the New Jersey Economic Development Authority (NJEDA) will be able to utilize unused credits from the Technology Business Tax Certificate Transfer Program to support the award of tax credits under the Angel Investor Tax Credit Act.
  • The Qualified Small Business Stock (QSBS) law creates a capital gains exemption for small business stock sold or exchanged after December 31, 2025, aligning New Jersey with many other states and federal tax incentives for long-term business investment.
  • The package of bills is expected to increase participation in the Evergreen Innovation Fund and Angel Tax Credit programs, unlock capital for entrepreneurs, and spur greater venture investment.
  • Business groups, including the BioNJ and the New Jersey Business & Industry Association (NJBIA), have commended the governor and Legislature for passing the legislation, citing its potential to enhance New Jersey's competitiveness and foster innovation-driven growth.

Statistics:

  • The new law will increase the maximum amount of qualified investment under the New Jersey Innovation Evergreen Act.
  • The Angel Investor Tax Credit Act will increase the amount of tax credit provided under the program.
  • The QSBS law will create a capital gains exemption for small business stock sold or exchanged after December 31, 2025.
  • The NJEDA expects to see increased participation in the Evergreen Innovation Fund and Angel Tax Credit programs, with the potential to unlock capital for entrepreneurs and spur greater venture investment.

Sources:

  • "New Jersey Governor Signs Three-Package Bill to Support Entrepreneurial Ecosystem," BioNJ, 30 June 2025.
  • "New Jersey Governor Signs Three Bills to Support Innovation Economy," New Jersey Business & Industry Association (NJBIA), 30 June 2025.
  • "Governor Murphy Signs Bills to Boost New Jersey's Innovation Economy," Press Release, Office of the Governor, 30 June 2025.