Bipartisan legislation introduced in Congress would make the New Markets Tax Credit (NMTC) permanent. Currently, it’s set to expire on Dec. 31, 2025. The NMTC program helps economically distressed communities attract private capital by providing investors with a 39% nonrefundable federal tax credit. Since 2000, the U.S. Treasury Department has used the NMTC to make 1,461 awards totaling $71 billion in tax allocation authority. The bill would index the allocation to inflation in future years. It would also exempt credit investments from the alternative minimum tax (AMT). The section of the bill on AMT relief would apply to taxable years beginning after Dec. 31, 2022.
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