Treasury announces 2014 New Market Tax Credit awards

Treasury announces 2014 New Market Tax Credit awards

The Treasury Department’s Community Development Financial Institutions Fund (CDFI Fund) today announced 76 organizations have been awarded more than $3.5 billion in New Markets Tax Credit (NMTC) authority.


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According to a Treasury release, the 76 community development entities (CDEs) receiving awards were selected from a pool of 263 applicants that had requested approximately $19.9 billion in allocation authority. The CDEs are headquartered in 27 different states and the District of Columbia, and collectively, these CDEs will support investments across the nation.


Read information about the successful CDE applicants in the award book [PDF 1.17 MB]


The NMTC program allows an investor a NMTC credit against federal income taxes for making qualified equity investments (QEIs) in entities known as community development entities (CDEs). The Treasury Department allocates the NMTC credits to the CDEs which, in turn, make qualifying investments (generally loans) to qualifying businesses (QALICBs) located in low income communities. Investors contribute cash to the CDE in exchange for an interest in the CDE which is generally structured as a partnership. The tax credit totals 39% of the cost of the QEI in the CDE and is claimed over a seven-year period. Investors in leveraged NMTC transactions can increase their tax benefit by pooling borrowed funds from a leverage lender with their cash investments to receive tax credit on the full amount of the QEI.

KPMG observation

KPMG’s Washington National Tax, Tax Credit and Energy Advisory Services group has experience in assisting awardees with the deployment of their allocations to businesses seeking NMTC financing, as well as in providing tax credit advice, modeling, and forecasting services. There are also other considerations for taxpayers and entities that are considering becoming NMTC investors or lenders.


For more information, contact a tax professional with KPMG’s Washington National Tax:

Susan Reaman | +1 (202) 533-3541 |

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