In the Consolidated Appropriations Act of 2020 passed by Congress on December 22, 2020, the New Markets Tax Credit (NMTC) program was provided with $25 billion over the next five years. Prior to this extension, which is the largest in the history of the credit, the NMTC program was set to expire on December 31, 2020. Under the new law, the NMTC program will expire on December 31, 2025.
According to the NMTC Coalition, such significant backing to the program is projected to generate nearly 600,000 jobs, 690 manufacturing businesses, 225 new or improved healthcare facilities, and 775 investments in daycare centers, boys and girls clubs, nonprofits, and other community facilities. From its inception in 2000, the NMTC program has proven to be an indispensable catalyst for economic growth in underserved, rural and severely distressed communities.
The $1.4 trillion omnibus spending package and $900 billion COVID-19 relief bill also include the permanence of a 4% minimum rate for Low-Income Housing Tax Credits (LIHTC), the extension of clean energy tax credits, $25 billion in emergency rental assistance, and $12 billion in new Community Development Financial Institution (CDFI) and Minority Depository Institution (MDI) funding, of which $9 billion is reserved for the capital investment program, while the other $3 billion will be made available to eligible institutions as grants.
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