GEDC

New Market Tax Credits

New Market Tax Credits Available in Gainesville!

The Texas New Market Tax Credit (NMTC) program is a federal tax incentive designed to increase the flow of private sector capital to rural communities overlooked by conventional leaders and investors. Most NMTC projects include the development or expansion of infrastructure for the growing business or operation, thereby creating long-term assets within those communities.

This designation is re-evaluated every 5 years. Now is the time to seriously consider Gainesville for your project!

Important components of the New Market Tax Credits:

  • Requires a minimum investment of $5 million.
  • Provides up to a 39% Tax Credit over 7 years
  • Project must have strong funding for costs not covered by NMTC
  • Project costs eligible include equipment, site prep, land acquisition, rehabilitation, soft costs such as closings costs, tenant improvements. (Working capital reserves permitted depending on circumstances)

Tax Credit Investors add a component that makes the monies available to the project upfront. They make an equity contribution to the project at a discounted rate in exchange for tax credits. Typically the project may realize the value of 33% Tax Credit up front where the Tax Credit Investor realizes 39% over 7 years, 5% the first three years and 6% the remaining 4 years – a win win.

NMTC Map

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