CDFI Income Tax CreditsCommunity Development Financial Institutions or CDFIs provide financing or financial services that supports community development. Some CDFIs finance housing, others finance economic development and others even provide consumer loans and other banking services for underserved groups. Most CDFIs are nonprofit corporations, but some operate on a for-profit basis. The San Luis Obispo County Housing Trust Fund has been certified as both a state and national CDFI. California CDFIs are certified by COIN (the California Organized Investment Network) of the California Department of Insurance. National CDFIs are certified by the CDFI Fund of the US Treasury. The State of California offers income tax credits to individuals and corporations, including insurance companies, that invest in certified California CDFIs. Because most CDFIs are nonprofit corporations, these investments are typically in the form of a loan rather than a direct investment. The CDFI Tax Credit equals 20% of the amount invested. For example, if $100,000 is invested, the tax credit is $20,000. The tax credit provides a dollar for dollar reduction in state taxes. It can be taken in the year of the investment or spread over multiple years. The minimum investment that qualifies for a CDFI Tax Credit is $50,000. The investment must be for at least five years and have an interest rate of 0%. If the investment is withdrawn or repaid in less than five years, the tax credit must be repaid proportionately. As note above, this program is administered by COIN at the California Department of Insurance. To learn more about the CDFI Tax Credit Program or make an eligible tax credit investment in the Housing Trust Fund, please contact us at 805-543-5970. California CDFI Tax Credit Information
(Note: The preceding tax codes are provided for informational purposes only. Individuals and firms that are considering a California CDFI Tax Credit investment are advised to discuss the tax consequences of such an investment with their legal and tax advisors prior to making any investment.) |
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(c) 2004-9 San Luis Obispo County Housing Trust Fund - Privacy Policy - This page was last updated on 11/03/2009