Neighborhood Assistance Program (NAP)

The Neighborhood Assistance Program (NAP) is a tax credit program that incentivizes businesses to contribute to charitable non-profit organizations by offering a tax credit for their contributions.

Any charitable non-profit community organization that holds a 501(c)(3) status with the IRS can apply for NAP.

The NAP application period typically starts in early spring and can be accessed through Electronic eGrants System. Before applying, eligible applicants should contact a DCED Regional Office for technical assistance with putting together the application and making sure it fits within the parameters of the program.

Yes, a contributor can donate to as many NAP projects as they wish. However, there is a maximum aggregate limit of NAP tax credits a contributor can receive in any given program year. If a contributor donates to three or less projects the maximum aggregate limit is $1,000,000. For four or more projects the aggregate limit is $2,500,000.

There is no minimum or maximum amount for contributions. Only the Neighborhood Partnership Program (NPP) subprogram has a minimum contribution amount. For NPP projects a contributor must contribute a minimum of $50,000 a year for each year of the project. Also, the project must be a minimum of $100,000 per year of the project.

No. Because NAP is a tax credit program, and there are no actual dollars being provided by the state or federal governments prevailing wage does not come into play for NAP.

Yes. Once an NAP tax credit has been approved and the contributor makes their contribution to the non-profit the contributor must apply for the tax credit through DCED. This is accomplished by filling out the provided NAP tax credit application and returning it to the NAP program office with proof of the contribution. At that time the NAP program office will process the application and provide a tax credit certificate to the contributor. The contributor will use the tax credit certificate with their tax returns to use the tax credit. The tax credit certificate also indicates where a contributor can specify how tax credits should be passed through.

NAP tax credits can be used against a contributor’s taxes for the current calendar year and the five subsequent calendar years for a grand total of six years.

Most NAP projects do not require an audit. Enterprise Zone Program (EZP) projects require a financial examination once the project is completed.

Typically, the NAP application opens in the spring and is open for about 90 days. The program year for approved NAP projects is July 1st through June 30th of the following year. All contributions must be received within this timeframe. The project must be completed by September 30th of the following year, which means there is a three month grace period to complete the project. The final community impact measures report is then due on or by December 31st.