Maine excluded investments that are used to cover “one-day loan” payments from the new markets capital investment credit. The credit can be taken against income and insurance premium taxes. This legislation essentially codifies a Finance Authority of Maine (FAME) regulation.
Credit No Longer Allowed for Certain Investments
Specifically, legislation amends the definition of “qualified low-income community investment” to exclude a capital or equity investment if:
- it was made after November 9, 2015; and
- more than 5% of the investment is used for certain purposes.
Those purposes include:
- refinancing costs, expenses, or other investments by a qualified active low-income community business (or related party) before the date of the investment;
- making equity distributions from a qualified active low-income community business to its owners;
- acquiring an existing business or enterprise in Maine; or
- paying transaction fees.
The legislation making the change was enacted without the governor’s signature.
L.D. 1796 (H.P. 1240), Laws 2018, effective 90 days after adjournment of legislative session