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Treasury announces first 2010 round of New Markets Tax Credits
WASHINGTON (4/9/10)--The U.S. Treasury’s Community Development Financial Institutions (CDFI) Fund on Thursday announced that the 2010 round of the New Market Tax Credit (NMTC) program has begun. Credit unions are among those eligible to participate in the NMTC, which seeks to spur the investment of new private sector capital into low-income communities by permitting individual or corporate taxpayers to receive a credit against federal income taxes for making Qualified Equity Investments (QEIs). Those investments must be made in designated Community Development Entities (CDEs). The Treasury's Community Development Financial Institutions (CDFI) Fund allocates the tax credits annually through a competitive application process. “The credit provided to the investor totals 39 percent of the investment in a CDE and is claimed over a seven‐year credit allowance period,” according to the release. In comments accompanying the release, CDFI Fund Director Donna Gambrell said that the NMTC “remains a critical tool” in the CDFI’s “efforts to ensure that economic recovery reaches the hardest-hit communities.” The $5 billion in tax credit authority made available through the NMTC “will help finance small businesses, grocery stores, healthcare centers, charter schools and job-training sites and will help create, save or support local jobs where they are needed most,” Gambrell added. Organizations that have received these credits “have raised $15.8 billion in equity investments” since the program began in 2002, according to the release. Applications for CDE certification must be received by April 26, and applications for the NMTC itself must be received by June 2. For the CDFI Fund release, use the resource link.
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