Applications for the 2023 Massachusetts Life Sciences Tax Incentive Program Due by February 2, 2024
The online portal for the 2023 Massachusetts Life Sciences Tax Incentive Program is open. Applications will be accepted until noon on Friday, February 2, 2024.
2023 Massachusetts Life Sciences Tax Incentive Program Overview
The Massachusetts Life Sciences Center (hereinafter “the MLSC” or “the Center”) was created in 2007. The Center receives annual funding from the state legislature to assist in supporting the growth and continued development of the life sciences industry in Massachusetts. The MLSC also engages in public-private funding initiatives.
One of the most popular and publicized programs offered by the Center since its inception has been the life sciences tax incentive program (hereinafter “the LSTIP”). This program allows eligible companies doing business in Massachusetts to select from a menu of tax incentives (for example, a refundable research credit) that are designed to assist them in their growth within the Commonwealth. These incentives are intended to award companies for creating life sciences jobs in the state. The awards have historically generated taxpayer incentives of approximately $15,000 per job created.
Among other things, to be considered for an award, a company must be registered to do business in the Commonwealth. A company must have employed at least ten (10) permanent full-time employees in Massachusetts as of December 31, 2023. Additionally, a company must commit to hiring at least 10 net, new full-time employees during the 2024 calendar year, and must retain the increased headcount through at least 2028. Annual reporting is required, and awards can be clawed back by the state if headcount and other requirements cease to be met.
Companies that receive an award will be notified May of 2024. Awards must be claimed during the state’s 2025 fiscal year, which will run from July 1, 2024, through June 30, 2025. For example, if a corporate excise benefit is selected and awarded, the award will be claimed by filing a corporate tax return claiming the award. For a calendar year taxpayer, this will mean that an extension of its 2023 Massachusetts corporate excise return will be necessary as filing must be delayed until the 2025 state fiscal year.
How can BNN help?
BNN can assist qualifying companies in selecting the best tax incentives for their particular fact patterns and sizes. We also have experience with the completion of applications on behalf of companies, and with performing high-level reviews of applications.
Even if the LSTIP is not currently the best option for your company, the Center offers a number of other programs for companies at all stages of the life sciences life cycle. Visit their website to learn more.
Life sciences companies that do business in Massachusetts and expect to hire at least ten full-time employees during the 2024 calendar year should consider applying for this program. If you would like to discuss how this program might benefit your company, please contact Leanne Scott or your preferred BNN professional at 800.244-7444.
Disclaimer of Liability: This publication is intended to provide general information to our clients and friends. It does not constitute accounting, tax, investment, or legal advice; nor is it intended to convey a thorough treatment of the subject matter.