The New Markets Tax Credit (NMTC) Program was established in 2000 as part of the Community Renewal Tax Relief Act of 2000 and aims to foster revitalization efforts in low-income and impoverished communities across the United States. The NMTC Program provides tax credit incentives to investors for equity investments in a certified Community Development Entity (CDE) whose primary mission is to invest in low-income communities. The credit equals 39 percent of the investment paid out over seven years: 5 percent each year for three years; and 6 percent in the final four years. The NMTC program has been used in conjunction with local efforts to spearhead redevelopment efforts, including commercial real estate development, in many areas.

Issue

The New Markets Tax Credit (NMTC) Program was established in 2000 as part of the Community Renewal Tax Relief Act 2000, and aims to foster revitalization efforts in low-income and impoverished communities across the United States. The NMTC Program provides tax credit incentives to investors for equity investments in a certified Community Development Entity (CDE) whose primary mission is to invest in low-income communities. The credit equals 39 percent of the investment paid out over seven years: 5 percent each year for three years; and 6 percent in the final four years. The NMTC program has been used in conjunction with local efforts to spearhead redevelopment efforts, including commercial real estate development, in many areas.

Status

The NMTC program was retained as part of the Tax Cuts and Jobs Act of 2017 and will need to be renewed in 2025.

Position

NAIOP supports continuation of the New Market Tax Credit program as a mechanism to foster economic revitalization and commercial real estate development in many of our nation’s urban areas.

Resources

New Markets Tax Credit Program

The Tax Cuts and Jobs Act of 2017

Contact

Aquiles Suarez
Senior Vice President for Government Affairs
703-904-7100, ext. 115