New Market Tax Credits: Investors Await Announcement for $7 Billion Round |
By year-end, The Community Development Financial Institutions Fund is expected to announce a combined round of New Market Tax Credits (NMTC) with $7 billion to award. The NMTC program started in 2000, aimed at bringing capital to distressed and low-income communities. These credits may be considered a boost or gap financing that is not repaid. The benefit from the improvements must be maintained for 7 years or face recapture of the tax credits. Eligibility is mainly determined by location and community impact. If approved and allocated, these credits generally account for 20-25% of the capital stack. Additional specifics on New Markets Tax Credit Program is available on-line. Huber Bongolan, Jr.
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