New Markets Tax Credits
for Senior Housing

The NMTC for Senior Housing funds stimulates new financial commitments in low-income areas

The Senior Housing New Markets Tax Credit program is a federal government aid tax plan designed to incentivize financial commitments into low-income communities, producing roughly 25% of plan costs in adjustable, under market lending that is normally forgiven at the end of the 7-year compliance time period.

The Senior Housing NMTC program incentivizes investments in distressed neighborhoods for financial rejuvenation

NMTC financiers make investments in companies referred to as Community Development Entities (CDEs) which in turn generate funding to companies in low-income communities. The intent of the plan is to push favorable financial revitalization in these regions.

A CBO Financial Subsidiary, Community Development Funding, LLC was among just 66 groups to be given NMTC allotment in Round 1 in 2003, and one of 62 teams to obtain an allowance in Round 2 - one of only ten groups to get both 1st and 2nd round allocations. Ever since, the CBO team has gone on to receive additional allowances for our own CDE, and helped many different customers with developing CDEs and proficiently making an application for a direct NMTC allowance award. NMTCs develop benefits to tax credit investors, businesses that need capital, and state and city government and economic advancement bodies.

Significant considerations for NMTC Programs lending for Senior Housing

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Senior Housing in a Marginalized Community

A low-income community is a census tract with at least 20% poverty, or one that has an average household income that is at or below 80% of the location's average family income.

Permitted Senior Housing NMTC Investments

Investments are made in the kind of equity-like lending to businesses situated in low-income census systems or ones that primarily serve or primarily utilize low-income individuals.

This funding typically is used as "space funding" for the advancement of industrial, commercial and retail real estate tasks (consisting of neighborhood centers).

Other NMTC projects may likewise consist of for-sale real estate designated for moderate-to-low-income families, eco-friendly innovations, and sustainable, ecologically friendly innovations operating on a commercial scale.

How to Gain Access to NMTCs for Senior Housing?

There are two ways to access the program. To money a single task, you will require to get CDEs that currently have an allotment and have a financial investment method that complements your company design and geographical place.

If you have a somewhat large task or a pipeline of jobs in need of financing, the finest choice is to form a CDE and use directly for an allowance of NMTCs.

Some Prerequisites Must Be Completed by the Investor to be Approved for Senior Housing NMTC?

The client should be a Qualified Active Low-Income Community Business (QALICB), which is a company that satisfies the list below guidelines:

  • The entity is is a for profit corporation or not-for-profit), or a partnership
  • It proactively carries out any service with the exception of residential rental, development, sale or licensing of intangibles, golf course, golf club, massage parlor, jacuzzi facility, suntan facility, racetrack, off-sale alcohol
  • Fewer than 5% of its properties consist of "collectibles" (e.g., antiques, fashion jewelry, red wine, etc).
  • Fewer than 5% of its properties include "financial property" (e.g., stocks, bonds, money aside from reasonable operating capital).
  • 40% of its concrete properties are situated in a low-income community.
  • 40% of worker services are conducted in a low-income community.

Relevant Information Regarding Senior Housing

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