39% over seven years for projects in low-income census tracts — permanent since 2025, which finally makes a multi-year pipeline possible.
| Quick Facts | |
|---|---|
| Credit amount | 39% of the qualified equity investment — 5% in years 1–3, 6% in years 4–7 |
| Status | Permanent, $5 billion annual allocation (2025 tax law) |
| How it works | CDFI Fund awards allocation to CDEs → investors fund CDEs → CDEs make below-market investments in qualified low-income community projects |
| Eligible projects | Real estate and operating businesses in qualified low-income census tracts — mixed-use, community facilities, manufacturing, healthcare |
| Typical benefit | Net subsidy of roughly 15% to 20% of project costs after structure costs, via forgivable-style leverage loans |
| Stacks with | Historic credits, common on community-facility rehabilitations; pairs with opportunity zone equity in overlapping tracts |
Permanence changes behaviour. CDEs and investors can now build multi-year pipelines instead of racing expiration dates, and projects in qualified tracts — which include most Carolina mill towns — have a durable subsidy to plan around.
NMTC structures are the most intricate in the credit world: leverage loans, CDE fees, a seven-year compliance period, and a put or call at unwind. That is precisely where three decades of transaction experience earns its keep.
We verify tract eligibility, size the NMTC benefit, match projects with CDEs holding allocation, and model the leverage structure — including historic and NMTC twins for community facilities.
Check my census tract and benefitOfficial references: IRC §45D; CDFI Fund (cdfifund.gov); OBBBA (P.L. 119-21).
39% of the qualified equity investment, claimed over seven years: 5% in each of years one through three and 6% in each of years four through seven. After structure costs the net subsidy to a project is typically 15% to 20% of project costs.
Yes. The 2025 tax law made the program permanent with a $5 billion annual allocation, ending two decades of short-term extensions.
Indirectly. The CDFI Fund awards allocation authority to Community Development Entities, and the CDE makes a below-market investment into the qualified project. Matching a project with a CDE that holds allocation and has appetite for it is a large part of the work.
Yes, and historic plus NMTC is a common structure for community facility rehabilitations in qualified tracts. It can also pair with opportunity zone equity where the tracts overlap.
If your project sits in a low-income census tract, there may be a durable subsidy you have not counted. Let's check.
