The State of Minnesota reported Thursday that 66 companies in the state collectively received $28 million of investments which qualified for the angel tax credit program in 2010, for which investors received $7 million of tax credits.

The new credit, which was signed into law in April 2010, gives a 25 percent tax break to individuals and investment funds that provide as much as $4 million in seed money to businesses focused on high technology or new proprietary technology.

A total of $11 million in tax credits was available in 2010, and the state will fund $12 million in credits annually between 2011 and 2014. Credits cannot exceed $125,000 per person per year.

The tax credit is available to investors and investment funds that funnel money into startups that are less than 10 years old, have fewer than 25 employees, have less than $2 million in previous equity investments, and are based in Minnesota.

In the first year, 275 investors were certified under the program and nearly 94 percent-or 258-made investments. Of those who made investments during the year, 79 were non-Minnesotans who contributed about $6.1 million.

According to the state's data, the business sectors that received the largest number of investments in 2010 were medical device and equipment (15 companies), software (14 companies), biotechnology (nine companies), and clean technology (eight companies).

Michael Schley, an attorney with Minneapolis-based Larkin Hoffman Daly & Lindgren, Ltd., said that he was “delighted” with the 2010 results of the program, which he says “is long overdue.”

“The fact that there are that many people investing in that many businesses says that this has a broad application and is not focused on a small number of companies,” Schley told Twin Cities Business on Friday.

Schley was involved with the development of the tax credit and last year participated in a hearing where he persuaded the tax committee to include language in the law that was more inclusive of smaller businesses. He said the law was originally more focused on businesses that were further along and not those in the “really early stages.”

For 2011, Schley thinks the amount available in state credits-which is $12 million plus an additional $3.9 million that rolled over from 2010-will be used before the end of the year.