Incentives

Making the potential possible with New Markets Tax Credits

Originally enacted by Congress in 2000, Federal New Market Tax Credits create win-win situations: powerful incentives for private investment, and economic development in low-income communities.  They close funding gaps and move qualified projects across finish lines, typically subsidizing 15 to 20 percent of capital cost.

Learn more about New Market Tax Credits and participants:

  • A Tax Credit Investor, who makes an equity contribution at a discounted rate in exchange for a 39 percent tax credit spread over 7 years
  • The Leveraged Lender that provides financing and receives interest payments;
  • A Fund that receives the equity contribution and loan proceeds
  • A Community Development Entity (CDE), which serves as the financial intermediary and administers the program
  • The Qualified Active Low Income Community Business (QALICB), recipient of NMTC benefits

What is the benefit to the project?

NMTC financing allows the QALICB to receive below market rates and interest only financing during the 7 year compliance period. NMTC financing provides the critical piece that moves the project forward and “but for” the NMTC financing, the project could not close.

 

Why engage HWH Group?

  • Guidance through entire process through closing, including structuring assistance, packaging and distribution of transaction to CDEs emphasizing all aspects of community impact, location of tax credit investor, assembly of closing team (legal counsel and accounting assistance if needed).
  • Proven track record of navigating the complex process and closing deals for our clients.
  • Explore navigating the process with the HWH Group

Significant benefits.  Complex structure.  HWH Group simplifies the process and increases success with its NMTC services and tax planning strategies:

  • Secures credits:  HWH Group compiles the deal package and locates credits that fit the project profile
  • Coordinates timelines:  HWH Group manages closing requirements among all parties
  • Meets requirements:  HWH Group provides compliance support by coordinating legal and financial guidance
  • Attracts investors:  HWH Group engages investors in a timely manner and seeks the highest return
  • Partners with lenders: HWH Group builds confidence throughout the process.

The HWH Group provides NMTC Services specific to each participant.

 

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