New Markets Tax Credit:

State Programs

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Alabama

Program New Markets Development Tax Credit Program
Enacting Legislation H.B. 257
Amending Legislation Not applicable.
Related Statutes Alabama Code §281-5-1
CDE Application Process Needs to be a CDE for federal purposes that included Alabama in its service area and has received an allocation of federal NMTCs.
Annual State CAP Limits $20 Million
Transaction CAP Limits $10 Million QLICI per QALICB
Credit Description 50 percent of the taxpayer's equity investment
How the Credit is Claimed Year 1: 0%, Years 2-7: 8.33%
Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements Same as federal
Recapture

The following events cause recapture:

  • The federal NMTCs associated with a QEI are recaptured (recapture amount proportionate to the federal recapture); 
  • The CDE fails to invest 85% of a QEI within 12 months and maintain such level of investment until the last credit allowance date for such QEI (recapture amount equal to all credits claimed);
  • The CDE redeems or makes a principal payment with respect to a QEI prior to the seventh anniversary of a QEI (recapture amount proportionate to the amount of redemption or repayment).
Other
  • Not sellable or transferable.
  • Tax credits earned by a partnership, limited liability company, S corporation, or other "pass-through" entity may be allocated to the partners, members or shareholders of that entity for their direct use in accordance with the provisions of any agreement among the partners, members or shareholders.
  • Credit may be carried forward to any of the taxpayer's subsequent taxable years.
Related Documents An Introduction the New Markets Tax Credit Program, Schedule OC, Alabama Taxes and Incentives, Form ET-1
Novogradac Contact

Brad Elphick

State Contact

Linda Swann
Linda.Swann@commerce.alabama.gov
(334) 353-0221

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Alaska

Program New Markets Tax Credit Assistance Guarantee and Loan Program
Enacting Legislation S.B. 66
Amending Legislation Not applicable
Related Statutes Alaska Statutes §44.88.700
CDE Application Process

Loan Guarantee

The applicant must have been awarded a NMTC allocation from a CDE, or be in the process of securing that allocation from one or more CDE’s. The applicant may then apply to AIDEA for a guarantee of the leveraged loan portion of the NMTC transaction. If, and when, AIDEA issues a Letter of Commitment, the applicant can use it to secure a commercial loan to the transaction from an eligible financial institution. If a loan is secured, AIDEA will work with the lender to ensure the terms and conditions of the guarantee and the loan are compatible and acceptable to both parties. The guarantee will be executed at the closing of the NMTC transaction.

Direct Loan

AIDEA may make a loan under this program only if it determines that the applicant was unable to use AIDEA’s Letter of Commitment to obtain a loan from a financial institution under commercially reasonable terms. In this case the applicant will be required to submit documentation demonstrating that at least two financial institutions have reviewed and rejected a loan application or that the application was approved but subject to terms AIDEA determines are commercially unreasonable.
Annual State CAP Limits $40 Million.
Transaction CAP Limits Not Applicable
Credit Description Not Applicable
How the Credit is Claimed Not Applicable
Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements

The project must be located within a census tract that qualifies, either by experiencing 20% poverty or more, or with a median family income of 80% or less in the area. Projects that are not located in these census tracts can also qualify by one of the following methods: 50% of customers are low-income, 40% of employees are low-income or 50% of owners are low-income.

Recapture

Not applicable

Other NMTCs are excluded from financing residential rental housing if more than 80% of the gross income is generated from the residential portion of the development. Ineligible activities include: golf courses and country clubs, gambling facilities, liquor stores, some farming businesses, massage parlors, tanning salons and spas.
Related Documents NMTC Model, Alaska Adopts Legislation to Promote the Use of NMTCs
Novogradac Contact

Owen Gray

State Contact

Mike Catsi
Business Development Officer
mcatsi@aidea.org
(907) 771-3060

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Arkansas

Program New Markets Jobs Act
Enacting Legislation H.B. 1832
Amending Legislation Not applicable
Related Statutes Arkansas Code §15-4-36
CDE Application Process
  • A CDE must submit an application and requisite fees to the Arkansas Economic Development Commission seeking certification of the proposed equity investment or long-term debt security as a QEI.
  • Within 30 days after receipt of a completed application, the Commission will grant or deny the application in full or in part.  If any part of the application is denied, the Commission will inform the applicant of the grounds for denial. 
  • If the application is denied as incomplete, and the applicant provides the additional information or documentation required, or otherwise completes its application within 15 days of the notice of denial, the application shall be considered completed as of the original date of submission. If the applicant fails to do so, the application will be denied and must be resubmitted in full with a new submission date.
Annual State CAP Limits $166 Million in QEI
Transaction CAP Limits

Not applicable

Credit Description 58% of the QEI
How the Credit is Claimed Year 0-1: 0% Year 2-4: 12% Year 5-6: 11%
Credit Period (Compliance) 6 years
QALICB requirements

Same as federal

Recapture

Same as federal

Other Not Applicable
Related Documents Rules and Regulations
Novogradac Contact Brad Elphick
State Contact

Arkansas Economic Development Commission
bstory@arkansasedc.com
(275)-26727

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California (Proposed)

Program

New Markets Tax Credit Program

Enacting Legislation A.B. 1399
Amending Legislation Not applicable
Related Statutes  
CDE Application Process  
Annual State CAP Limits $40 Million
Transaction CAP Limits  
Credit Description 39% of qualified investments
How the Credit is Claimed  
Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements

 

Recapture  
Other

Related Documents Not Applicable
Novogradac Contact Owen Gray
State Contact  

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Florida

Program Florida New Markets Development Program
Enacting Legislation S.B. 406
Amending Legislation Not applicable
Related Statutes Florida Statutes §288.991-288.9922
CDE Application Process Needs to be a CDE for federal purposes and needs to be authorized to serve businesses in Florida. Need to submit an application to the office to approve a proposed investment as a QEI. The CDE must issue the QEI in exchange for cash within 60 days after it receives the order approving an investment as a QEI, otherwise the order is void.
Annual State CAP Limits $33.6 Million
Transaction CAP Limits $10 Million in QEI
How the Credit is Claimed Years 1-2: 0%, Year 3: 7%, and Years 4-7: 8%.
Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements Derives at least 50% of its total gross income from the active conduct of business within any low-income community for any taxable year.

Uses at least 40% of its tangible property, whether owned or leased, within any low income community for any taxable year.

Performs at least 40% of its services through its employees in a low-income community fo any taxable year.

Attributes less than 5% of the average of the aggregate unadjusted bases of the property of the entity to collectibles or nonqualified financial property.

Will create or retain jobs that pay an average wage of at least 115% of the federal poverty income guidelines for a family of four.

Recapture The following events cause recapture:
  • All the same events that cause a recapture at the federal level
  • The federal new market tax credits get recaptured;
  • The CDE fails to provide the office with information, reports or documentation required by the New Markets Development Program Act
  • The office determines that a taxpayer received tax credits to which the taxpayer was not entitled
  • The CDE fails to maintain 85% of the QLICIs in Florida
  • The CDE fails to invest at least 85 % of the purchase price in QLICIs within 12 months after the issuance of a qualified investment
  • The CDE fails to maintain 85% of the purchase price in QLICIs until the last credit allowance date for a QEI
Other Expires December 31, 2022.

Related Documents Not Applicable
Novogradac Conact

Christina Apostolidis

State Contact Brook Pace
E-Mail
(850) 717-8519

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Illinois

Program New Markets Development Program
Enacting Legislation S.B. 2015
Amending Legislation Not applicable
Related Statutes 20 Illinois Compiled Statutes 663
CDE Application Process Needs to be a CDE for federal purposes that has entered into an allocation agreement with the CDFI Fund pursuant to which Illinois is included in the CDE's service area. Need to submit an application to the IL Department of Commerce and Economic Opportunity (DCEO) to approve a proposed investment as a QEI.   Must issue QEI within 30 days of DCEO approval, and must provide evidence of DCEO of receipt of cash investment within 10 days of QEI issuance.
Annual State CAP Limits $10 Million in credit
Transaction CAP Limits $10 Million in QEI
Credit Description 39% of the QEI
Howthe Credit is Claimed Years 1-2: 0%, Year 3: 7%, and Years 4-7: 8%
Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements Same as federal
Recapture

The following events cause recapture:

• The federal new market tax credits get recaptured
• The CDE redeems or makes a principal payment with respect to a QEI prior to the 7th anniversary of a QEI (recapture amount proportionate to the amount of redemption or repayment)
• The CDE fails to invest 85% of a QEI within 12 months and maintain such level of investment until the last credit allowance date for such QEI (recapture amount equal to all credits claimed)

Other QEI into CDE can be an equity investment or a long-term debt security instrument (minimum 7 year term, no acceleration, amortization, or prepayment features, but no limitation on acceleration for default on covenants designed to ensure compliance with IL NMTC Act or Section 45D). Insurance companies that are subject to the insurance premium tax and claims the credit against the insurance premium tax is not require to pay any additional retaliatory tax imposed pursuant to the Illinois Insurance Code. Any business that derives or expects to derive 15% or more of its annual revenue from the rental or sale of real estate is not considered a QALICB, except this restriction does not apply to a business that is controlled by or under common control with another business if the second business (i) does not derive or expects to derive 15% or more of its annual revenue from the rental or sale of real estate, and (ii) is the primary tenant of the real estate leased from the initial business. Can be used irrespective of use of Federal NMTCs in same transaction. Credit is not refundable or saleable on the open market; may be allocated through pass-through entities. Five year carry forward permitted if credit cannot be used in a taxable year.
Related Documents NMTC Program Guidelines
Novogradac Contact

Annette Stevenson

State Contact

Anthony Cefali
Illinois Department of Commerce and Economic Opportunity
anthony.cefali@illinois.gov
312.814.3958

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Kentucky

Program New Markets Development Program
Enacting Legislation H.B. 2
Amending Legislation H.B. 445
Related Statutes Kentucky Statutes §141.434
CDE Application Process Needs to be a CDE for federal purposes with a service area including the Commonwealth of Kentucky. Needs to have entered into an allocation agreement with the CDFI Fund. An application also needs to be submitted to the state.
Annual State CAP Limits $10 Million in credit
Transaction CAP Limits $10 million in QEI
Credit Description 39% of the QEI
How the Credit is Claimed Years 1-2: 0%, Year 3: 7%, and Years 4-7: 8%
Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements Same as federal
Recapture The following events cause recapture:
• The federal new market tax credits get recaptured
• The CDE redeems or makes a principal payment with respect to a QEI prior to the 7th anniversary of a QEI (recapture amount proportionate to the amount of redemption or repayment)
• The CDE fails to invest 85% of a QEI within 12 months and maintain such level of investment until the last credit allowance date for such QEI (recapture amount equal to all credits claimed)
Other Any business that derives or expects to derive 15% or more of its annual revenue from the rental or sale of real estate is not considered a QALICB, except this restriction does not apply to a business that is controlled by or under common control with another business if the second business does not derive or expects to derive 15% or more of its annual revenue from the rental or sale of real estate, and is the primary tenant of the real estate leased from the initial business.
Other Any business that derives or expects to derive 15% or more of its annual revenue from the rental or sale of real estate is not considered a QALICB, except this restriction does not apply to a business that is controlled by or under common control with another business if the second business does not derive or expects to derive 15% or more of its annual revenue from the rental or sale of real estate, and is the primary tenant of the real estate leased from the initial business.
Related Documents Application for Certification of Qualified Equity Investments, Notice of Kentucky New Markets Development Program Tax Credit and Certification, Regulations
State Contact

Cabinet for Economic Development
econdev@ky.gov
(800) 626-2930

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Louisiana

Program New Markets Jobs Act
Enacting Legislation H.B. 726
Amending Legislation Not applicable
Related Statutes Louisiana Code §1911, Louisiana Code §1912
CDE Application Process Must be a CDE for federal purposes and an application must be submitted to the state, along with $500,000 refundable deposit.
Annual State CAP Limits $55 million in authority
Transaction CAP Limits  $10 million cap on QEIs to any single QALICB
Credit Description 45% of the QEI Credits are applied towards premium tax liability not income tax liability.
How the Credit is Claimed Years 1-2: 14%, Year 3-4: 8.5%, Year 5-7: 0%
Credit Period (Compliance) 7 years
QALICB Requirements Same as federal
Recapture The following events cause recapture:
• The federal new market tax credits get recaptured
• The same events that cause recapture at a federal level
Other The credits can be carried forward 10 years and can be transferred.
Related Documents FAQs, FAQs 2, Fiscal Note, Application, Revenue Information Bulletin
State Contact

Department of Revenue
(225) 219-2780
E-Mail

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Maine

Program New Markets Capital Investment Tax Credit Program
Enacting Legislation S.P. 311
Amending Legislation L.D. 1043; H.P 1293
Related Statutes Maine Revised Statutes 10 §1100-Z
CDE Application Process Needs to be a CDE for federal purposes and an application needs to be submitted to the state.
Annual State CAP Limits Not applicable
Transaction CAP Limits $40 Million in QEI
Credit Description 39% of the QEI
How the Credit is Claimed Years 1-2: 0%, Year 3: 7% Year 4-7: 8%
Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements Same as federal
Recapture If any federal credits are recaptured, all of the state credits may be recaptured.
Other Not applicable
Related Documents Certification Application, Program Rule
Novogradac Contact

Jim McGowan

State Contact

FAME General Counsel Christopher Roney
(207) 620-3520
croney@famemaine.com

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Mississippi

Program Equity Investment Tax Credit Program
Enacting Legislation H.B. 1727
Amending Legislation H.B. 1662
Related Statutes Mississippi Code §57-105-1
CDE Application Process Needs to be a CDE for federal purposes and an application needs to be submitted to the state.
Annual State CAP Limits $15 Million in Credits
Transaction CAP Limits $10 Million in QEI
Credit Description 24% of the QEI
How the Credit is Claimed Years 1-3: 8%
Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements Same as federal
Recapture The following events cause recapture:
• All the same events that cause a recapture at the federal level
• The federal new market tax credits get recaptured.
Other The credit can be carried forward 7 years.
Related Documents Application for Certification of Economic Incentives, Equity Investment Tax Credit Summary, Guidelines, Tax Incentives for Economic Development, Tax Incentives, Exemptions, and Credits, Tax Structure
Novogradac Contact Rebecca Darling
State Contact

Financial Resources Division
(601) 359-3552
financial@mississippi.org

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Nebraska

Program New Markets Job Growth Investment Tax Credit Program
Enacting Legislation L.B. 1128; L.B. 1022
Ameding Legislation Not Applicable
Related Statutes Nebraska Revenue Statutes §77-1101 to 77-1119
CDE Application Process Needs to be a CDE for federal purposes.
Annual State CAP Limits $15 Million in QEI
Transaction CAP Limits Not Applicable
Credit Description 39% of the QEI
How the Credit is Claimed

Years 1-2: 0% Years 3: 7% Years 4-7: 8%

Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements

Use at least 85% of the proceeds from QEI to make QLICIs in a QALICB in Nebraska.

Recapture

The following events cause recapture:
• The issuer redeems or makes principal repayments with respect to a QEI prior to the seventh anniversary
• The federal new market tax credits get recaptured
• The CDE fails to invest in a QALICB in Nebraska

Other L.B. 1022: A qualified community development entity that seeks to have an equity investment or long-term debt security designated as a qualified equity investment and eligible for tax credits under the New Markets Job Growth Investment Act shall apply to the Tax Commissioner. There shall be no new applications for such designation filed under this section after December 31, 2022.
Related Documents Application for Certification of Qualified Equity Investments Eligible for the NMTC, Notice of Qualified Equity Investment
Novogradac Contact Owen Gray
State Contact

Tom Milburn
Revenue Tax Specialist, Policy Section
(402) 471-5814 
tom.milburn@nebraska.gov  

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Nevada

Program New Markets Tax Credit Program
Enacting Legislation S.B. 357
Amending Legislation Not applicable
Related Statutes Nevada Revised Statutes §231A 
CDE Application Process

The CDEs that have been certified by the federal NMTC program and Nevada is in their certified area are eligible to apply for the state NMTC program.

Annual State CAP Limits $200 Million in QEI
Transaction CAP Limits $50 Million in QEI
Credit Description 58% of the QEI
How the Credit is Claimed

Years 1-2: 0% Years 3-5: 12% Years 6-7: 11%

Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements

Same as federal

Recapture

The following events cause recapture:
• The issuer redeems or makes principal repayments with respect to a QEI prior to the seventh anniversary
• The federal new markets tax credits get recaptured
• The CDE fails to invest in a QALICB in Nevada

Other

Not applicable

Related Documents CDEs Contact Information, QEI Authorization Awarded, Program Overview
Novogradac Contact Mike Morrison
State Contact

Ash Mirchandani
(702) 486-4492
amirchandani@business.nv.gov

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North Carolina Proposed

Program New Markets Jobs Initiative
Enacting Legislation S.B. 522*; H.B. 680*
Amending Legislation Not Applicable
Related Statutes Not Applicable
CDE Application Process The CDEs that have been certified by the federal NMTC program and include North Carolina in their certified area are eligible to apply for the state NMTC program.
Annual State CAP Limits $500 Million in QEI; $208,333,333 in QEI, with $156.25 Million going to the Rural Reserve Fund and  the $52,083,333 going to the Statewide Reserve Fund
Transaction CAP Limits $7 Million in QEI in one QALICB
Credit Description 58% of the QEI
How the Credit is Claimed

Years 1-2: 0% Years 3-5: 12% Years 6-7: 11%

Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements Same as federal
Recapture

The following events cause recapture:
• The issuer redeems or makes principal repayments with respect to a QEI prior to the seventh anniversary
• The federal new markets tax credits get recaptured
• The CDE fails to invest in a QALICB in North Carolina
• Prior to the final credit allowance date of a QEI, the proceeds were used to make QEI in any one QALICB in excess of 25% of cash proceeds

Other Tax credits earned by a partnership, limited liability company, S-corporation, or other "pass-through" entity may be allocated to the partners, members, or shareholders of such entity for their direct use in accordance with the provisions of any agreement among such partners, members, or shareholders.
Related Documents Not applicable

Novogradac Contact

Rebecca Darling
State Contact

Not applicable

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Ohio

Program New Markets Tax Credit Program
Enacting Legislation H.B. 1
Amending Legislation H.B. 478
Related Statutes Ohio Revised Statutes §5725.33
CDE Application Process Needs to be a CDE for federal purposes with a service area including any portion of the State of Ohio.
Annual State CAP Limits $10 Million
Transaction CAP Limits $1 Million
Credit Description 39% of the QEI
How the Credit is Claimed Years 1-2: 0% Years 3: 7% Years 4-7: 8%
Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements Similar to federal. Excludes businesses that derives or expects to derive 15% or more of its annual revenue from rental or sale of real property, except those principally owned by a principal user of the property which is formed solely for the purpose of renting or selling the real property back to such principal user if the principal user does not derive 15% or more of its gross annual revenue from the rental or sale of real property.
Recapture The following events cause recapture:
• The same events that trigger federal recapture
• The Ohio Director of Development determines that an investment is not a QEI or that the proceeds of an investment for which tax credit is claimed are used to make QLICIs other than in QALICBs
Other Tax credits can be carried forward four years. Tax credits can be transferred. The credit can only apply against state franchise taxes paid by domestic companies, as well as some taxes imposed on foreign insurance companies.
Related Documents Overview, Introduction to Ohio New Markets Tax Credits, Notice of Qualified Equity Investment, Program Determination

Novogradac Contact

Annette Stevenson
State Contact

New Markets Tax Credit Program Contact
ohionewmarkets@development.ohio.gov

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Oregon

Program Low Income Communities Jobs Initiative
Enacting Legislation S.B. 817
Amending Legislation Not applicable
Related Statutes Oregon Revised Statutes §315.526-315.536
CDE Application Process Needs to be a CDE for federal purposes with a service area including any portion of the State of Oregon.
Annual State CAP Limits $16 Million
Transaction CAP Limits $8 Million in QEI
Credit Description 39% of the QEI
How the Credit is Claimed Years 1-2: 0% Year 3: 7% Years 4-7: 8%
Credit Period (Compliance) 7 years (same as federal)
QALICB Requirements Same as federal
Recapture The following events cause recapture:
• The federal credits get recaptured
• The CDE makes a principal repayment with respect to a QEI before the seven year credit period
• The CDE fails to invest 85% of the QEI into a QLICI within 12 months of the issuance of a QEI and maintain the same level of investment in QLICIs until the end of the seven year credit period
Other

15% of the total qualified equity investments is set aside for investments in clean energy projects. Businesses that receive more than 15% of their revenue from real estate are ineligible for the credit. QEI into CDE can be an equity investment or a long-term debt security instrument (minimum seven-year term, no acceleration, amortization, or prepayment features, but no limitation on acceleration for default on covenants designed to ensure compliance with the act or IRC Section 45D). Tax credits can be carried forward.

Related Documents Determination Request Form , Overview, Notice of Qualified Equity Investment, Introductory Presentation, Projects Map, Program Document Summary
Novogradac Contact

Nicolo Pinoli

State Contact

John Saris
john.saris@biz.state.or.us

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South Carolina

Program South Carolina New Markets Jobs Act
Enacting Legislation S.337
Amending Legislation Not Applicable
Related Statutes Not Applicable
CDE Application Process

An application to the South Carolina Department of Revenue must include:
· Evidence that the CDE has been certified by the CDFI Fund and that South Carolina is within its service area

· A copy of an allocation agreement with the CDFI Fund dated after Jan. 1, 2014
· A detailed description of the QEI planned
· Examples of QALICBs that the applicant has invested in as part of the federal program

The application also requires a $5,000 nonrefundable application fee and proof that the CDE and subsidiaries have made at least $40 million in QLICIs as part of the federal program, with no QLICI larger than $4 million to an individual QALICB.
The South Carolina Department of Revenue will approve or deny applications in full or in part within 30 days of the date of receipt

Annual State CAP Limits $250 million in authority
Transaction CAP Limits $4 million in QLICIs to an individual QALICB
Credit Description 58 percent of QEI that can be applied against state premium tax liability
How the Credit is Claimed Years 1-2: 0 percent, Years 3-6: 12 percent ,Year 7: 10 percent
Credit Period (Compliance) 7 years
QALICB Requirements Same as federal but limited to businesses meeting the U.S. Small Business Administration size eligibility standards
Recapture

85 percent of the purchase price of the QEI must be invested in QALICBs by the second credit allowance date. The South Carolina Department of Revenue allows for a six month cure period before initiating recapture

Other
Not Applicable
Related Documents Not Applicable
Novogradac Contact Brad Elphick
State Contact

Not Applicable

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Texas Proposed

Program State New Markets Tax Credit Program
Enacting Legislation H.B. 2061
Amending Legislation Not Applicable
Related Statutes Not Available
CDE Application Process An application under this section must include the following:
• Evidence of the applicant's certification as a CDE, including evidence of the service area of the entity that includes this state
• A copy of an allocation agreement executed by the applicant, or its controlling entity, and the CDFI Fund
• A certificate executed by an executive officer of the applicant attesting that the allocation agreement remains in effect and has not been revoked or canceled by the CDFI Fund
• Description of the proposed amount and structure, and of the purchaser, of the QEI
• Identifying information for a qualified investor that will earn premium tax credits as a result of the issuance of the QEI
• Examples of the types of QALICB in which the applicant, its controlling entity, or affiliates of its controlling entity have invested under the federal New Markets Tax Credit Program, except that an applicant is not required to disclose the identity of a specific QALICB in which the applicant intends to invest
• A nonrefundable application fee of $5,000 to be paid to the comptroller
• A refundable performance deposit of $500,000 required by Subchapter E
Annual State CAP Limits Not Applicable
Transaction CAP Limits

Not Applicable

Credit Description

39% of the QEI

How the Credit is Claimed

Years 1-2: 0% Years 3: 7% Years 4-7: 8%

Credit Period (Compliance) 7 years
QALICB Requirements Not available
Recapture The following events cause recapture:
• The federal credits get recaptured
• The CDE makes a principal repayment with respect to a QEI before the 7 year credit period
• The CDE fails to invest 85% of the QEI into a QLICI within 12 months of the issuance of a QEI and maintain the same level of investment in QLICIs until the end of the 7 year credit period
• Prior to the final credit allowance date of a qualified equity investment, the proceeds were used to make qualified low-income equity investments in any one qualified active low-income community businesses in excess of 25% of cash proceeds
Other

$750 Million program cap.

Tax credits earned by a partnership, limited liability company, S-corporation, or other "pass-through" entity may be allocated to the partners, members, or shareholders of such entity for their direct use in accordance with the provisions of any agreement among such partners, members, or shareholders.
Related Documents Not Available
Novogradac Contact

Nick Hoehn

State Contact Not Available

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Utah

Program Utah Small Business Jobs Act
Enacting Legislation S.B. 233
Amending Legislation 31A-3-102, 59-7-102, 631-1-263
Related Statutes 59-9-197, 63M-1-3401 through 63M-1-3412
CDE Application Process • A CDE must submit an application to the Utah Governor's Office of Economic Development seeking certification of the propsedproposed qualified equity investment (QEI) or long term debt security.
• Applicants must also submit a deposit equal 0.5% percent of the QEI with their application, which is refunded at the end of the compliance period, if the CDE does not initiate recapture during the compliance period.
• Within 30 days of receipt of a completed application, the office shall grant or deny the application in full or in part.
• If the application is denied in any part, the applicant may provide additional information and documentation to correct or complete its application within 15 days of the notice of denial, the application shall be considered completed as the original date of submission. If the applicant fails to do so, the application is denied, and the applicant may reapply with a full application and a new submission date
Annual State CAP Limits $50 million in QEI
Transaction CAP Limits

Not Applicable

Credit Description

58 percent of the QEI

How the Credit is Claimed

Year 0-2: 0 percent, Year 3-5: 12 percent, Year 6-7: 11 percent

Credit Period (Compliance) 7 Years
QALICB Requirements Same as federal, with additional requirement that business must meet size eligibility established by the United States Small Business Administration as defined in 13 C.F.R. Sec.121.101-201
Recapture Same as Federal, 6 month cure period after first notice of non-compliance
Other

• New capital requirement: QALICB cannot own, or have the right to acquire ownership in the CDE issuing the QEIs. Additionally the QALICB cannot loan or invest the QEI back into the CDE issuing the QEIs.
• 150% percent investment requirement: A QEI is certified until the seventh credit allowance date, or when the CDE has used the proceeds from the initial QEI to invest in QALICBs such that the new QEIs exceed 150% percent of the original QEI.

Related Documents  
Novogradac Contact

Mike Morrison

State Contact  

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