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Sophisticated investors in early stage innovative companies can receive a tax credit of 20% of their investment, up to a limit of $200,000, and subsequent sale of the company shares will be capital gains tax free provided they are held for 12 months to ten years. There are also concessional capital gains tax outcomes if the shares are held for longer than ten years. Smaller investors that don’t meet the “sophisticated investor” test are eligible for the tax incentives only if their investment in early stage innovative companies is $50,000 or less, for any particular tax year. Question: What are…