About

Advocacy

Policy Agenda

Events

Membership

Sponsor

Education

Newsletters

Resources

Technical Assistance

×

Tax Credit Finance Resource Center

Tax credit programs allow businesses and investors to claim tax credits for committing resources to a project or business. Several different types of tax credit programs exist at the federal and state levels to encourage investments in redevelopment projects, affordable housing, specific industries, and communities of all sizes.

The Tax Credit Finance Resource Center provides information about the various tax credit programs available and how they can be used within the context of development finance. Tax credits directly reduce a tax payer's tax liability and are not a deduction, thus making them a very desirable and effective tool. They can be used in urban, rural and suburban communities, and in some cases on a regional basis. They can also provide a targeted impact by addressing many different community sectors, such as low-income neighborhoods, historic districts and under-served markets that present opportunities for new investment.

There are three main federal tax credit programs: New Markets Tax Credits, Historic Rehabilitation Tax Credits and Low-Income Housing Tax Credits. There are also numerous state tax credit programs available, which can be found in the map provided in the resource center below.

In order to receive a tax credit, an investor must first demonstrate that an investment has been made. Such a resource commitment could be an investment in a bricks and mortar real estate project or a cash investment in a business. The distributor of the tax credit is authorized to issue credit based on the actual outlay of resources as evidenced by the investor. Tax credits can be used for several purposes in development projects: to provide an increased internal rate of return for investors, to reduce the interest rates on a particular financing package, and perhaps most importantly, to provide a repayment method for investors in place of cash. In the latter case, the credits can often be sold on the secondary market to generate income.

Want regular updates on tax credits? Subscribe to CDFA's Tax Credit Finance Update newsletter.

Subscribe

-Understanding Tax Credits

Interested in learning more about Tax Credits? This section contains resources on understanding the basics of Tax Credits.

The Low Income Housing Tax Credit: How It Works and Who It Serves

The Low-Income Housing Tax Credit (LIHTC) is a complex but crucial tool for the production and preservation of affordable rental housing. In this report, the Urban Institute outlines the basics of the LIHTC program, including how it works, the various partners involved, how financing is structured, how investors benefit from the program, and who lives in the LIHTC properties.

Historic Tax Credits - Community Development Fact Sheet

This Community Developments Fact Sheet summarizes certain aspects of the Historic Tax Credit (HTC) program for national banks and federal savings associations (collectively, banks) and explains how HTCs may be used to support a bank’s affordable housing and community development strategies.

New Markets Tax Credit Summary Report - FY 2003 to FY 2017 Members only

The CDFI Fund requires all CDEs that have been awarded NMTC allocations to submit an annual report detailing how they invested Qualified Equity Investment (QEI) proceeds in low-income communities. The Summary Report categorizes all CDE investments utilizing the North American Industry Classification System (NAICS) from FY 2003 - FY 2017.

Introduction to the New Markets Tax Credit Program - CDFI Fund

This 2018 presentation from the CDFI Fund provides an introduction to the New Markets Tax Credit program.

-Resources

View all Tax Credit Finance Resources

-Federal Historic Tax Credit (HTC) Resources

Moving America and the Environment Forward Framework

Bond Finance | Brownfield Financing | Community Development | Energy Finance | Federal | (more)

"Moving America and the Environment Forward" is a House Ways and Means Committee statement of principles on how the committee wants to approach an infrastructure bill. It includes $760 billion of proposals.

Joint Committee on Taxation Report: Overview of Selected Provisions for Financing Infrastructure Investments Members only

Bond Finance | Community Development | Historic Preservation | Housing Finance | Infrastructure Finance | (more)

This report by the Staff of the Joint Committee on Taxation was prepared on January 29, 2020 for a hearing before the House Committee on Ways and Means. It discusses an overview of infrastructure financing options, including the highway trust fund, infrastructure banks, tax-exempt bonds, P3s, NMTCs, Opportunity Zones, LIHTCs, and Historic Rehab Tax Credits.

Historic Tax Credits - Community Development Fact Sheet

Historic Preservation | Tax Credits | National Park Service (NPS) | Office of Comptroller of the Currency (OCC) | U.S. Dept. of the Interior (DOI) | (more)

This Community Developments Fact Sheet summarizes certain aspects of the Historic Tax Credit (HTC) program for national banks and federal savings associations (collectively, banks) and explains how HTCs may be used to support a bank’s affordable housing and community development strategies.

CDFA Food Finance White Paper Series: Food Systems & Investment Tools

Agriculture Finance | CDFA Original Research | Community Development | Food Systems Finance | Opportunity Zones | (more)

This paper continues a white paper series demonstrating the ways in which traditional development financing is already supporting food systems, with a focus on finance tools that help to stimulate investment. An overview of investment tools, such as tax credits and opportunity zones, is provided with examples of current programs as well as an extensive collection of case studies to illustrate how these tools can make an impact.

Historic Tax Credit Enhancement Act - October 2019 Senate Bill Members only

Historic Preservation | Legislative | Tax Credits | National Park Service (NPS) | U.S. Dept. of the Interior (DOI)

This is the text of the Historic Tax Credit Improvement Act. The Act was introduced in the U.S. Senate in October 2019 by Sens. Bill Cassidy (R-LA), Ben Cardin (D-MD), Susan Collins (R-ME), and Maria Cantwell (D-WA).

View More Federal Historic Tax Credit Resources

-Low-Income Housing Tax Credit (LIHTC) Resources

Understanding Whom the LIHTC Serves - Data on Tenants in LIHTC Units

Housing Finance | Social Finance | Tax Credits | Internal Revenue Service (IRS) | U.S. Dept. of Housing & Urban Development (HUD) | (more)

As mandated through the Housing and Economic Recovery Act of 2008, state agencies administering the Program are required to submit demographic and economic data on LIHTC tenants to HUD. While not inclusive of all tenants served by the LIHTC, the summary tables of state tenant data received as of December 31, 2017, provides a useful picture of the program's beneficiaries.

Internal Revenue Bulletin: 2020-10

Bond Finance | Housing Finance | Tax Credits | Internal Revenue Service (IRS) | U.S. Dept. of Treasury

IRS Notice 2020-10 provides population figures to calculate calendar-year 2020 limits for private activity bonds (PABs) and low-income housing tax credit (LIHTC) for all 50 states, Washington, D.C., and Puerto Rico. The PAB cap is the greater of the population multiplied by $105 or $321,775,000. The LIHTC cap for each state is the greater of the population multiplied by $2.8125 or $3,217,500.

California Rural Infrastructure Finance Guidebook

Access to Capital | Agriculture Finance | Bond Finance | Brownfield Financing | CDFA Original Research | (more)

CALED knows from its work supporting economic development throughout California that infrastructure financing is a challenge for many rural communities. CALED collaborated with CDFA to develop this guidebook to meet the need for a resource to help build capacity in those areas, as well as move economic development projects forward.

Moving America and the Environment Forward Framework

Bond Finance | Brownfield Financing | Community Development | Energy Finance | Federal | (more)

"Moving America and the Environment Forward" is a House Ways and Means Committee statement of principles on how the committee wants to approach an infrastructure bill. It includes $760 billion of proposals.

Joint Committee on Taxation Report: Overview of Selected Provisions for Financing Infrastructure Investments Members only

Bond Finance | Community Development | Historic Preservation | Housing Finance | Infrastructure Finance | (more)

This report by the Staff of the Joint Committee on Taxation was prepared on January 29, 2020 for a hearing before the House Committee on Ways and Means. It discusses an overview of infrastructure financing options, including the highway trust fund, infrastructure banks, tax-exempt bonds, P3s, NMTCs, Opportunity Zones, LIHTCs, and Historic Rehab Tax Credits.

View more LIHTC Resources

-New Markets Tax Credit (NMTC) Resources

Moving America and the Environment Forward Framework

Bond Finance | Brownfield Financing | Community Development | Energy Finance | Federal | (more)

"Moving America and the Environment Forward" is a House Ways and Means Committee statement of principles on how the committee wants to approach an infrastructure bill. It includes $760 billion of proposals.

Joint Committee on Taxation Report: Overview of Selected Provisions for Financing Infrastructure Investments Members only

Bond Finance | Community Development | Historic Preservation | Housing Finance | Infrastructure Finance | (more)

This report by the Staff of the Joint Committee on Taxation was prepared on January 29, 2020 for a hearing before the House Committee on Ways and Means. It discusses an overview of infrastructure financing options, including the highway trust fund, infrastructure banks, tax-exempt bonds, P3s, NMTCs, Opportunity Zones, LIHTCs, and Historic Rehab Tax Credits.

New Markets Tax Credit Summary Report - FY 2003 to FY 2017 Members only

Community Development | Economic Development | Tax Credits | Community Development Financial Institutions Fund (CDFI Fund) | U.S. Dept. of Treasury

The CDFI Fund requires all CDEs that have been awarded NMTC allocations to submit an annual report detailing how they invested Qualified Equity Investment (QEI) proceeds in low-income communities. The Summary Report categorizes all CDE investments utilizing the North American Industry Classification System (NAICS) from FY 2003 - FY 2017.

CDFA Food Finance White Paper Series: Food Systems & Investment Tools

Agriculture Finance | CDFA Original Research | Community Development | Food Systems Finance | Opportunity Zones | (more)

This paper continues a white paper series demonstrating the ways in which traditional development financing is already supporting food systems, with a focus on finance tools that help to stimulate investment. An overview of investment tools, such as tax credits and opportunity zones, is provided with examples of current programs as well as an extensive collection of case studies to illustrate how these tools can make an impact.

Opportunity Zones and Tax Credits - Jonathan Crawford Members only

Community Development | Housing Finance | Opportunity Zones | Tax Credits | Community Development Financial Institutions Fund (CDFI Fund) | (more)

Jonathan Crawford from Stonehenge Capital Company, LLC presents on Opportunity Zones and Tax Credits in Ohio during the Ohio Roundtable

View more NMTC Resources

-State Tax Credits

California Rural Infrastructure Finance Guidebook

Access to Capital | Agriculture Finance | Bond Finance | Brownfield Financing | CDFA Original Research | (more)

CALED knows from its work supporting economic development throughout California that infrastructure financing is a challenge for many rural communities. CALED collaborated with CDFA to develop this guidebook to meet the need for a resource to help build capacity in those areas, as well as move economic development projects forward.

Available CFA Resources - New York Regional Economic Development Councils Members only

Access to Capital | Agriculture Finance | Bond Finance | Brownfield Financing | Community Development | (more)

In 2011, Governor Cuomo created ten Regional Economic Development Councils (REDC) and the Consolidated Funding Application (CFA) to advance the administration’s efforts to improve New York’s business climate and expand economic growth. This 2019 document outlines information about each agency’s grant programs, including eligibility, scoring criteria, applicant requirements, and agency contact information.

Incorporating PACE Into Complex Projects - Rachel Davis, Caleb Bell, Jerry Brunswick, Frances Kern Mennone, Scott Ringlein Members only

Energy Finance | Historic Preservation | Tax Credits

Rachel Davis, Caleb Bell, Jerry Brunswick, Frances Kern Mennone, and Scott Ringlein present Incorporationg PACE Into Complex Projects.

CDFA Food Finance White Paper Series: Food Systems & Investment Tools

Agriculture Finance | CDFA Original Research | Community Development | Food Systems Finance | Opportunity Zones | (more)

This paper continues a white paper series demonstrating the ways in which traditional development financing is already supporting food systems, with a focus on finance tools that help to stimulate investment. An overview of investment tools, such as tax credits and opportunity zones, is provided with examples of current programs as well as an extensive collection of case studies to illustrate how these tools can make an impact.

Making Sense of Incentives: Taming Business Incentives to Promote Prosperity Members only

Access to Capital | Economic Development | Incentives | Tax Credits

In evaluating incentives, everything depends on the details: how much in incentives it takes to truly cause a firm to locate or expand, the multiplier effects, the effects of jobs on employment rates, how jobs affect tax revenue versus public spending needs. Do benefits of incentives exceed costs? This depends on the details. This book by the Upjohn Institute is about those details.

View more State Tax Credit Resources

-Programs Map

Search the map below for tax credit programs by state. This specialized search is part of CDFA's State Financing Program Directory, the only online resource cataloging the development finance programs offered by state governments. Click on a state to see a sample of state tax credit programs available. Login with a CDFA Member account at the top of the page to view full results.

-Case Studies

Incorporating PACE Into Complex Projects - Rachel Davis, Caleb Bell, Jerry Brunswick, Frances Kern Mennone, Scott Ringlein Members only

Rachel Davis, Caleb Bell, Jerry Brunswick, Frances Kern Mennone, and Scott Ringlein present Incorporationg PACE Into Complex Projects.

CDFA Food Finance White Paper Series: Food Systems & Investment Tools

This paper continues a white paper series demonstrating the ways in which traditional development financing is already supporting food systems, with a focus on finance tools that help to stimulate investment. An overview of investment tools, such as tax credits and opportunity zones, is provided with examples of current programs as well as an extensive collection of case studies to illustrate how these tools can make an impact.

CDFA // BNY Mellon Webcast Series: Fill in the Gaps with New Markets Tax Credits Members only

During this installment of the CDFA // BNY Mellon Development Finance Webcast Series, learn from expert speakers as they discussed their plans for the recent allocation of New Markets Tax Credits.

Innovative State-Led Efforts to Finance Agricultural Conservation Members only

U.S. farmers are currently facing the most difficult agricultural economy since the 1980s. At the same time, many states are wrestling with the necessity of addressing environmental challenges. This report expounds upon the excellent work states are doing regarding conservation tax credits, cover crop incentives and environmental certifications to increase conservation across the landscape. The report also highlights how these programs work for agricultural producers and states.

Finance Fund Invests in UC Gardner Neuroscience Institute Members only

University of Cincinnati Gardner Neuroscience Institute (UCGNI) is comprised of a diverse group of world-class physicians and faculty that provide specialized services for complex neurologic and psychiatric disease, illness, and injuries. Finance Fund provided $8 million of federal NMTC allocation; Cincinnati Development Fund, Inc. provided $8 million of federal NMTC allocation; Uptown Consortium, Inc. provided $20 million of federal NMTC allocation; and Capital One Community Renewal Fund, LLC, the investor, provided an additional $5 million of federal NMTC allocation.

View More Case Studies

-Headlines

Environmental Groups Applauding Budget Victories
The Legislative Gazette | Apr. 7 | Tax Credits | State Green Finance Programs | State Tax Credit Programs

COVID-19 Legislative Relief Provisions for Small Businesses
JD Supra | Apr. 6 | Access to Capital | Disaster Recovery & Relief | Food Systems Finance | Legislative | Revolving Loan Funds (RLFs) | (more)

Alaska to Use Tax Credits to Increase Air Quality
AP News | Mar. 28 | Energy Finance | Green Finance | Legislative | State Finance Program | Tax Credits

Solar Developers Launch Lobbying Effort to Curb COVID-19 Impacts, Advance Remote Permitting
Utility Dive | Mar. 23 | Incentives | Tax Credits | Renewable Energy Production Tax Credit (PTC) | Renewable Energy Investment Tax Credit (ITC)

PHFA Shares Initiatives to Maintain Affordable Housing During Financial Pressures Brought on by COVID-19-Related Restrictions
Northcentralpa.com | Mar. 22 | Disaster Recovery & Relief | Housing Finance | Tax Credits | U.S. Dept. of Housing & Urban Development (HUD) | COVID-19 | (more)

View More Headlines

-Publications

Tax Credit Finance Reference Guide

Brownfield Financing | Energy Finance | Federal | Innovation Finance | Internal Revenue Service (IRS) | (more)

Written in conjunction with Ice Miller LLP, the Tax Credit Finance Reference Guide examines how to effectively apply tax credits to development opportunities, and explains the basics of tax credits and the fundamentals of using these tools. In addition, the guide walks through the pros and cons of using tax credits along with the guidelines for completing due diligence, performance monitoring, and benchmarking success. This comprehensive Reference Guide discusses in detail the primary tax credits available at the federal level, along with certain state tax credit programs, and includes numerous case studies of successful tax credit projects.

Practitioner's Guide to Economic Development Finance

Access to Capital | Bond Finance | Brownfield Financing | CDFA Original Research | Development Finance Toolbox | (more)

The Practitioner's Guide to Economic Development Finance 2nd Edition is the only comprehensive resource dedicated to building and utilizing the development finance toolbox. The Practitioner's Guide provides the insight and practical information needed to critically understand how economic development is financed and the tools, strategies and techniques used to build strong communities. From bonds, tax increment finance and special districts to tax credits, seed & venture capital, revolving loan funds and much more, this Guide outlines the financing tools required for succeeding in today's competitive economic development climate.

Unlocking Capital: A Handbook for Becoming a High Performing Development Finance Agency

Access to Capital | Bond Finance | CDFA Original Research | Economic Development | Foundations | (more)

Unlocking Capital: A Handbook for Becoming a High Performing Development Finance Agency (Handbook) serves as a companion to the Practitioner’s Guide to help illuminate the structures of development finance agencies (DFAs), essential conduits to access development finance tools. The Handbook provides an overview of DFAs and their myriad roles in various development efforts. Included in this discussion is a comprehensive look at over a dozen high-performing DFAs throughout the country. The Handbook is designed to be a starting point for local leaders to engage in the creation or acceleration of a DFA to build and utilize the development finance toolbox.

View More Publications

-Training Courses

CDFA Offers two tax credit courses on an annual basis.

The Intro Tax Credit Finance WebCourse examines the application of tax credit programs in greater economic development finance efforts. This course will discuss the practical application of tax credit programs including brownfields, new markets, low income housing, historic preservation, and state-specific programs.

The Fundamentals Course will help you understand the variety of development finance tools available, from bonds, tax credits and TIF, to federal financing programs, RLFs, and access to capital lending resources.

-Upcoming Events

CDFA Federal Policy Conference (cancelled)
April 14-15, 2020
Washington, DC

The federal government plays a critical role in driving private and public investment in innovation, job creation, infrastructure, and community development. With the 2020 presidential election quickly approaching, development finance will be a key policy issue across the nation. The 116th Congress will also play a major role in shaping our country’s economic development policy going forward. It's up to the development finance community to focus the national discussion on smart federal policy, and CDFA is the voice of the economic development finance community on Capitol Hill. For these reasons, CDFA will host its CDFA Federal Policy Conference on April 14-15 in Washington DC.

View more Upcoming Events

-Webcasts

CDFA // BNY Mellon Webcast Series: Unlocking Capital for Native American Communities Members only

Community Development | Economic Development | Tax Credits | Tribal Finance | Webcasts

Tribal lands cover over 5% of the national land base, making Tribal nations the fourth largest state and some of America’s largest rural populations. The U.S. Constitution recognizes Tribal nations as sovereign governments, yet have a nation-to-nation relationship with the U.S. government. Due to this political structure, Native American-owned businesses face steep barriers to accessing capital and economic development policies, and therefore face crippling poverty with unemployment levels far above the national average. With limited access to capital, many Native American-owned businesses struggle to start, build, and grow. During this installment of the CDFA // BNY Mellon Development Finance Webcast Series, we will discuss financing tools for Native American-owned businesses to assist in strengthening tribal nation’s local economies.

CDFA // BNY Mellon Webcast Series: Fill in the Gaps with New Markets Tax Credits Members only

Community Development | Tax Credits | U.S. Dept. of Treasury CDFI Fund | Webcasts | Community Development Financial Institutions Fund (CDFI Fund) | (more)

During this installment of the CDFA // BNY Mellon Development Finance Webcast Series, learn from expert speakers as they discussed their plans for the recent allocation of New Markets Tax Credits.

2019 Q2 CDFA Quarterly Legislative Update

Bond Finance | Legislative | Tax Credits | Webcasts

In the second Quarterly Legislative Update of 2019, CDFA's Legislative Team discussed progress on pending CDFA legislation, other pending development finance legislation such as extenders, as well as what to expect from Congress in the coming months.

CDFA // BNY Mellon Webcast Series: The Landscape of Mega Project Initiatives Members only

Access to Capital | Bond Finance | Economic Development | Incentives | Public-Private Partnership (P3) Financing | (more)

During this installment of the CDFA // BNY Mellon Webcast Series, expert speakers from CAI Global, Baltimore Development Corporation, Arlington Economic Development, and VEDP provided an in-depth overview of the approaches being used by cities, counties, and states to attract mega projects like Amazon HQ2 and Under Armour.

CDFA // BNY Mellon Webcast Series: Unwinding Tax Credit Unwinds Members only

Tax Credits | Webcasts

During this installment of the CDFA // BNY Mellon Webcast Series, Lillian Plata with Nee Plata Law LLC presented on the structure of tax credit unwinds for New Markets Tax Credit and Low-Income Housing Tax Credit deals.

View More Webcasts

CDFA National Sponsors

Become a Sponsor