Tax Credit Transactions

Structuring and effectuating transactions involving one or more types of tax credits in addition to traditional financing can be quite challenging. Our team of attorneys with the full range of required expertise has helped clients achieve success and overcome nearly every hurdle related to the full gamut of tax credits, resulting in additional funds to fill out the capital stacks of our clients’ projects.

New Markets Tax Credits

Alston & Bird has advised clients on New Markets Tax Credit (NMTC) transactions for more than a decade. Our team of attorneys has extensive knowledge of tax, finance, real estate, environmental, corporate, government policy, and tax-exempt organizations laws and regulations, enabling us to provide comprehensive legal counsel for all parties involved in NMTC deals. Our clients include qualified active low-income community businesses (QALICBs) such as hospitals, schools, community centers, and other organizations, sponsors, community development entities (CDEs), lenders, government entities, and consultants. 

Federal Low-Income Housing and Historic Tax Credits

We provide guidance to tax credit investors, syndicators, and real estate developers on transactions involving federal low-income housing tax credits (LIHTC) and historic tax credits (HTC), as well as related state tax credits. Our tax, real estate, and finance attorneys draw on their broad experience to advise on various tax credit structures, prepare the relevant documents including tax opinions, and work with lenders and accountants to structure and execute these complex transactions. Our attorneys also have experience structuring transactions that incorporate varying combinations of LIHTC, HTC, NMTC, and opportunity zones.

Renewable Energy Tax Credits

We provide guidance to investors, syndicators, and developers of renewable energy projects on structuring their transactions to leverage project financing to take advantage of renewable energy tax credits such as the investment tax credit (ITC) and production tax credit (PTC). Our experience includes representing clients developing and financing energy projects of varying sizes, including rooftop solar and utility-scale, ground-mounted solar facilities. With the new and generous incentives included in the Inflation Reduction Act of 2022, developers are increasingly seeking to monetize the tax incentives available for renewable energy projects. Our team has assisted in the initial application and ongoing reporting requirements needed to leverage these incentives.

• Represented a QALICB in an NMTC financing to develop and construct an approximately 555,000 square foot surgical center, including 225,000 square feet of clinical space and 330,000 square feet of parking; eight operating rooms; four endoscopy rooms; a cancer center; surgical clinics including orthopedics, general surgery, ENT, oral surgery, an eye center, and imaging; pharmacy; lab; central sterile supply; and common support spaces. 
• Represented a Fortune 500 company in its first ITC investment consisting of a utility-scale, ground-mount solar facility with a capacity greater than 100 megawatts (MW). 
• Represented a renewable energy developer in the closing of a predevelopment loan facility exceeding $200 million. 
• Represented multiple insurers in the placement of dozens of tax insurance policies to cover risk of loss of ITCs and PTCs in renewable energy transactions. Covered losses include begun construction, recapture, qualified basis, and enhanced credits under the Inflation Reduction Act.
• Represented tax credit syndicators in their equity investments in utility-scale solar projects throughout the United States. 
• Represented a LIHTC investor in its investment in a 250-unit apartment complex next to the Atlanta BeltLine. 
• Represented an investor in the rehabilitation of a historic mill utilizing HTC financing, allowing a nonprofit organization to open a museum commemorating its mission. 
• Represented a QALICB in an NMTC financing to acquire and renovate the headquarters of a nonprofit organization offering safe homes for children with unstable lives, housing for families with embedded support services that promote self-sufficiency, and counseling services to support parental growth and skill building. 
• Represented a CDE in connection with an NMTC financing with proceeds used in the acquisition, construction, and equipping of a new 16,000 square foot Boys & Girls Club and an adjacent 33,000 square foot community center that houses multiple nonprofit entities that provide a variety of community services, including a literacy center, a health clinic, facilities for the promotion of healthy eating, a child watch area, and a facility that effectively links community resources to families in distress. 
• Represented an NMTC consultant in building out its operations, drafting standard form contracts for QALICB and CDE clients, preparing to shepherd clients through NMTC transactions, and advising on business development strategies.
• Represented a CDE in a working capital NMTC transaction in which the QALICB used tax credit equity to pay its employees’ salaries and benefits.