Community Development Investment Tax Credit Act of 2023

This bill creates a new tax credit for individuals and businesses that invest in Community Development Financial Institutions (CDFIs), which provide financial services to underserved communities. Taxpayers can claim a credit equal to 3% of their investment for the first 10 investments, and 4% for subsequent investments, claimed annually over 20 years (the original investment date plus 19 anniversary dates). The total annual credit amount is capped at $1 billion in 2023, increasing to $2 billion in 2024 and beyond, with the Treasury Secretary allocating credits to CDFIs based on financial performance, ability to attract private capital, and other criteria. This policy change aims to encourage private investment in CDFIs that serve low-income communities and small businesses.