What We Offer - Summary of Current Programs
Land Conservation Projects
These projects provide investors with an opportunity to donate a conservation easement and/or the property to a qualified 501(c)(3) organization (typically a land trust) or governmental agency as an alternative to development. Pursuant to IRC section 170(h), a donor receives a federal charitable tax deduction if the donation complies with all of the provisions of the Code.
Historic Preservation Projects
These projects provide investors with an opportunity to preserve the historic “envelope” of a certified historic property by donating an easement to a qualified 501(c)(3) organization or governmental agency as an alternative to development. Pursuant to IRC section 170(h), a donor receives a federal charitable tax deduction if the donation complies with all of the provisions of the Code.
Historic Tax Credit Projects
These projects provide investors with an opportunity to utilize the Historic Tax Credit Program to rehabilitate and preserve certified historic structures. Pursuant to IRC section 47, qualified restoration expenditures on certified historic structures are eligible for a 20% Federal Tax Credit against passive income.
Renewable Energy Tax Credit Projects
These projects provide investors with an opportunity to utilize the Renewable Energy Tax Credit Program to develop renewable or alternative energy projects, with a focus on solar energy projects. Pursuant to IRC section 48, qualified expenditures on a project, including both equipment and labor, are eligible for a 30% Federal Tax Credit against passive income.
Opportunity Zone Funds/Projects
The Opportunity Zones program was established by Congress in the Tax Cuts and Jobs Act as an innovative approach to spurring long-term private sector investments in low-income urban and rural communities nationwide. Opportunity Funds are private sector investment vehicles that invest at least 90 percent of their capital in designated Opportunity Zones. Opportunity Funds provide investors the chance to put money to work rebuilding the nation’s disadvantaged communities. The fund model enables a wide array of investors to pool their resources in Opportunity Zones, increasing the scale of investments going to underserved areas. The Opportunity Zones program offers investors several incentives for putting their capital to work in low-income communities, including a temporary tax deferral on reinvested capital gains, a step-up in basis on reinvested capital gains and an exclusion from taxable income on qualified opportunity zone capital gains.
State Tax Credit Programs
State Tax Credit programs vary by state but common programs involve film production, historic rehabilitation, job creation, renewable energy production and housing for low income families.
Focus on After-Tax returns
Although the various programs made available by AP offer the potential for competitive rates of return on the underlying investments, the focus is on generating superior after-tax returns utilizing a combination of investment returns, tax credits and tax deductions to put more after-tax dollars in investors’ pockets.
The Power of After-Tax Investing
Very few investors pay attention to the “entire picture” and focus solely on “returns” being offered on various investments. They completely disregard the effect of federal and state income taxes. In other words, they focus on what they are “earning” rather than what they are “taking home”. For example, if an investment generates a 10% return and those returns are all treated as ordinary income (like interest income), a resident of Pennsylvania who is taxed at the highest federal marginal tax rate of 37% will also pay PA state income taxes of 3.07%. So, that investor will lose 40.7% of that return to taxes and the net return, after taxes, would be 5.93%.
On the other hand, an investment that generates 9%, after-tax, will generate a net return, after taxes, of 9% and WOULD PUT OVER 50% MORE INCOME IN THE INVESTOR’S POCKET(9% versus 5.93%).