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Community Development Investment Tax Credit Act of 2023

3/6/2024, 4:35 PM

Summary of Bill S 2963

Bill 118 s 2963, also known as the Community Development Investment Tax Credit Act of 2023, is a piece of legislation introduced in the US Congress. The main goal of this bill is to incentivize private investment in low-income communities by providing tax credits to investors who contribute to community development projects.

Under this bill, investors who make qualified investments in designated low-income areas would be eligible to receive a tax credit equal to a percentage of their investment. The tax credit would be designed to encourage investment in projects such as affordable housing, small business development, and infrastructure improvements in underserved communities.

The Community Development Investment Tax Credit Act of 2023 aims to stimulate economic growth and job creation in low-income areas by attracting private capital to support community development initiatives. Proponents of the bill argue that it will help to revitalize struggling neighborhoods and improve the quality of life for residents in these communities. Opponents of the bill may argue that it could potentially benefit wealthy investors more than the communities it is intended to help, or that it may not be an effective way to address the root causes of poverty and inequality. However, supporters believe that the tax credits provided by the bill will be a valuable tool in promoting investment in underserved communities and fostering economic development. Overall, the Community Development Investment Tax Credit Act of 2023 is a proposed piece of legislation that seeks to encourage private investment in low-income communities through the use of tax credits. Its ultimate impact on economic development and community revitalization will depend on how it is implemented and utilized by investors and community development organizations.

Congressional Summary of S 2963

Community Development Investment Tax Credit Act of 2023

This bill allows investors a business-related tax credit for investment in a Community Development Financial Institution (CDFI). The applicable percentage of such credit is 3% for the first 10 years of investment in a CDFI with a 1% increase after the initial credit allowance date and for investments without a fixed term or duration.

The tax credit is available to investors who invest in various CDFIs to provide financial support for increasing wealth in low- and moderate-income communities. The national limitation on the credit is $1 billion for 2022, $1.5 billion for 2023, and $2 billion for 2024 and each year thereafter, with adjustments for inflation.

Current Status of Bill S 2963

Bill S 2963 is currently in the status of Bill Introduced since September 28, 2023. Bill S 2963 was introduced during Congress 118 and was introduced to the Senate on September 28, 2023.  Bill S 2963's most recent activity was Read twice and referred to the Committee on Finance. as of September 28, 2023

Bipartisan Support of Bill S 2963

Total Number of Sponsors
1
Democrat Sponsors
1
Republican Sponsors
0
Unaffiliated Sponsors
0
Total Number of Cosponsors
16
Democrat Cosponsors
8
Republican Cosponsors
8
Unaffiliated Cosponsors
0

Policy Area and Potential Impact of Bill S 2963

Primary Policy Focus

Taxation

Alternate Title(s) of Bill S 2963

Community Development Investment Tax Credit Act of 2023
Community Development Investment Tax Credit Act of 2023
A bill to amend the Internal Revenue Code of 1986 to provide a credit for investment in Community Development Financial Institutions.
A bill to amend the Internal Revenue Code of 1986 to provide a credit for investment in Community Development Financial Institutions.

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