Congressional Expansion Of CCF Program

The Capital Construction Fund ("CCF") program is designed to encourage owners of U.S. flagged vessels to accumulate sufficient capital to acquire additional U.S. flagged vessels by offering tax incentives to do so. The CCF program works like a combination of an IRA and a Roth IRA in the sense that, like a regular IRA, an income tax deduction is available when funds are set aside and deposited into a CCF account and, like a withdrawal from a Roth IRA, withdrawals for approved vessel expenditures are tax free. Earnings on deposit in a CCF account also grow tax free.

On December 16, 2022, Congress passed the National Defense Authorization Act of 2023 which contains a material expansion of the United States Maritime Administration's Capital Construction Fund Program. Specifically, Section 3544 of the Act expands the definition of "Qualified Agreement Vessels" to include all vessels engaged in the foreign or domestic trade of the United States.