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Press Release
May 3, 2023
4 minute read

NJEDA Opens 2023 Net Operating Loss Program Application


NJ Tech & Life Sciences Companies Can Now Apply to Sell Their Net Operating Losses & Unused Research & Development Tax Credits for Cash

TRENTON, N.J. (May 3, 2023) – The New Jersey Economic Development Authority (NJEDA) opened applications this week for its 2023 Technology Business Tax Certificate Transfer Program, commonly known as the Net Operating Loss (NOL) Program. The program enables early-stage technology and life sciences businesses in the Garden State to sell a percentage of their New Jersey net operating losses and unused research and development (R&D) tax credits to unrelated profitable corporations for cash.

The NOL Program is accepting applications through June 30, 2023, at http://www.njeda.gov/nol. Participants can use the capital raised through the NOL Program to help cover allowable costs incurred in connection with operating their businesses such as salaries, R&D, and other working capital expenditures.

The New Jersey Economic Recovery Act of 2020 (ERA), which was signed into law by Governor Phil Murphy in 2021, increased the program’s annual cap from $60 million to $75 million. It also increased the lifetime cap for an individual applicant from $15 million to $20 million.

“It’s fitting that the application for this year’s NOL Program opened during Small Business Week, as the program routinely helps companies keep their lights on, their employees paid, and propels their research and development forward,” said NJEDA Chief Executive Officer (CEO) Tim Sullivan. “Enhancements made to the program by the ERA help ensure emerging companies have access to the capital they need to succeed, which is a key component of fulfilling Governor Murphy’s vision to establish New Jersey as a leader in innovation.”

In line with Governor Murphy’s vision to create the most diverse and inclusive innovation ecosystem in the nation, $15 million of the $75 million program allocation will be reserved for the surrender of transferable tax benefits exclusively by eligible companies operating within the boundaries of the State’s three Innovation Zones of Newark, Camden, and the Greater New Brunswick area, companies located in Opportunity Zones, and/or women- or minority-owned businesses certified by the State of New Jersey.

Potential applicants interested in learning more should visit the program website, which covers eligibility requirements in detail at http://www.njeda.gov/nol and attend the NJEDA’s upcoming NOL Program webinar on May 9. Registration can be found at http://www.njeda.gov/nol. A recording of the webinar, which will include a walk-through of the application, will be available at http://www.njeda.gov/nol following the event.  

Since the program’s inception in the late 1990s, more than $1.17 billion in funding has been distributed to over 570 technology and life sciences companies. The average award for companies approved to sell their net operating losses through the program in 2022 was over $3.1 million.

“Given the broad range of acceptable funding uses, the NOL Program has been hailed for decades as a lifeline for emerging companies that have yet to reach profitability,” said NJEDA Chief Economic Transformation Officer Kathleen Coviello. “The ability to secure an average award of over $3 million without giving up any equity makes this extremely attractive to entrepreneurs. At the same time, it complements the state’s many assets as an attraction tool for entrepreneurs choosing to grow their businesses in New Jersey.”   

United Silicon Carbide, BioAegis Therapeutics, and Palatin Technologies are among the hundreds of companies that have taken advantage of the program. Here’s what their CEOs had to say about the program:

“The NOL Program was a consistent source of funding for us and was among the many state resources that helped sustain us until we were acquired by Qorvo in 2021. My advice to entrepreneurs just starting out is simple: Apply for this program. It gives you cash without requiring you to give up equity.”

Dr. Christopher Dries, former United Silicon Carbide President and CEO and current General Manager of Power Device Solutions for Qorvo
United Silicon Carbide also previously benefited from the NJEDA’s Angel Investor Tax Credit Program and its Edison Innovation Fund

“We’ve been fortunate to leverage a variety of New Jersey’s assets as we’ve worked to develop groundbreaking discoveries in inflammation and infection. The ability to sell our losses for cash through the NOL Program, combined with the Garden State’s proximity to major pharmaceutical companies and highly talented scientists, make this the ideal place for biotechnology companies like ours.”

Dr. Susan Levinson, CEO of BioAegis Therapeutics
BioAegis Therapeutics is a tenant at the NJEDA’s NJ Bioscience Center – Step-Out Labs and a graduate of its NJ Bioscience Center – Incubator.

“New Jersey’s decision to increase the lifetime cap from $15 million to $20 million has afforded us the opportunity to realize the benefits of the NOL program for additional years. Funding provided through the program has been critical to the growth of our bio-pharmaceutical R&D company, and we are thankful to the NJEDA for aiding our efforts as we work to continue to develop drugs for various indications.”

Dr. Carl Spana, CEO of Palatin Technologies

About the New Jersey Economic Development Authority

The New Jersey Economic Development Authority (NJEDA) serves as the State’s principal agency for driving economic growth. The NJEDA is committed to making New Jersey a national model for inclusive and sustainable economic development by focusing on key strategies to help build strong and dynamic communities, create good jobs for New Jersey residents, and provide pathways to a stronger and fairer economy. Through partnerships with a diverse range of stakeholders, the NJEDA creates and implements initiatives to enhance the economic vitality and quality of life in the State and strengthen New Jersey’s long-term economic competitiveness.

To learn more about state resources available to New Jersey entrepreneurs and early-stage companies, visit https://www.njeda.gov and follow @NewJerseyEDA on FacebookTwitterInstagram, and LinkedIn.

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