## Can Existing Businesses Apply for New Market Tax Credit Loans?
Yes, existing businesses can apply for New Market Tax Credit (NMTC) loans. The NMTC program is a federal tax credit program that provides incentives for private investment in low-income communities. Existing businesses are eligible to apply for NMTC loans if they meet certain requirements, including:
* **The business must be located in a designated low-income community.**
* **The business must be engaged in activities that create jobs and economic development in the community.**
* **The business must have a plan to use the NMTC loan proceeds to finance qualified investments in the community.**
## Benefits of NMTC Loans for Existing Businesses
There are a number of benefits to obtaining an NMTC loan for an existing business. These benefits include:
* **Reduced cost of capital.** NMTC loans offer below-market interest rates, which can save businesses money on their borrowing costs.
* **Increased access to capital.** NMTC loans can provide financing for projects that may not be eligible for traditional bank loans.
* **Tax benefits.** NMTC loans provide investors with a federal tax credit equal to 39% of the loan amount. This tax credit can be used to offset federal income tax liability.
## How to Apply for an NMTC Loan
To apply for an NMTC loan, existing businesses must submit an application to a Community Development Entity (CDE). CDEs are non-profit organizations that are certified by the U.S. Department of the Treasury to administer NMTC loans.
The NMTC loan application process includes the following steps:
1. **Develop a project plan.** The project plan should outline the business’s investment plans, the expected economic benefits of the project, and the project’s impact on the low-income community.
2. **Identify a CDE.** Businesses can search for CDEs on the NMTC website.
3. **Submit an application to the CDE.** The application should include the project plan and other required documentation.
4. **Wait for CDE approval.** The CDE will review the application and make a decision on whether to approve the loan.
## Additional Resources
* [NMTC Program Overview](https://www.cdfifund.gov/programs-training/new-markets-tax-credit-nm/)
* [How to Apply for an NMTC Loan](https://www.nmstdc.org/how-to-apply)
* [CDE Directory](https://www.cdfifund.gov/partners/cde-directory/)