The New Markets Tax Credit: Background, Considerations and Issues


Marlin Barrett (Editor)

Series: Government Procedures and Operations
BISAC: BUS004000

The New Markets Tax Credit (NMTC) is a non-refundable tax credit intended to encourage private capital investment in eligible, impoverished, low-income communities. NMTCs are allocated by the Community Development Financial Institutions Fund (CDFI), a bureau within the United States Department of the Treasury, under a competitive application process. Investors who make qualified equity investments reduce their federal income tax liability by claiming the credit.

This book describes the New Markets Tax Credit Program and the major considerations banks may need to address when using the tax credits to support community and economic development activities. The book examines the primary opportunities and risks associated with the use of NMTCs and discusses the methods used by national banks and federal savings associations (collectively, banks) to structure transactions and use the credits effectively. (Imprint: Nova)

Table of Contents

Table of Contents


Chapter 1 – New Markets Tax Credit: An Introduction (pp. 1-12)
Donald J. Marples and Sean Lowry

Chapter 2 – New Markets Tax Credits: Unlocking Investment Potential (pp. 13-48)
David Black

Chapter 3 – New Markets Tax Credit: Better Controls and Data Are Needed to Ensure Effectiveness (pp. 49-88)
United States Government Accountability Office

Chapter 4 – New Markets Tax Credit: The Credit Helps Fund a Variety of Projects in Low-Income Communities, but Could Be Simplified (pp. 89-142)
United States Government Accountability Office


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