New Markets Tax Credit
Spur private investment in low-income and distressed communities
Credit Amount
39%
Over 7 years
Projects Financed
7,100+
Since 2000
Leverage Ratio
8:1
Private to Federal
Program Details
Established
2000 (Community Renewal Tax Relief Act)
Administered By
U.S. Treasury's CDFI Fund
Credit Structure
39% of Qualified Equity Investment over 7 years (5% for first 3 years, 6% for last 4 years)
Claim Period
7 years
Eligible Projects
Community facilities, businesses, mixed-use real estate in low-income census tracts
Target Beneficiaries
Residents of low-income census tracts
Compliance Requirements
At least 85% of funds invested in qualified projects
Best Use Case
Financing community-serving projects like healthcare, schools, manufacturing
How NMTC Works
CDE Receives Allocation
Community Development Entities (CDEs) compete for and receive NMTC allocation from the CDFI Fund.
Investor Makes QEI
Investors make Qualified Equity Investments (QEI) into CDEs, receiving tax credits of 39% over 7 years.
CDE Deploys Capital
CDEs use the capital to make Qualified Low-Income Community Investments (QLICIs) in eligible projects.
Project Receives Financing
Qualified businesses receive below-market financing, typically with significant forgiveness after the 7-year compliance period.
Ready to Explore NMTC for Your Project?
Check your project's eligibility and get matched with CDEs that have available allocation.