Tax increment financing (TIF) is a method of financing real estate development costs--i.e.: to encourage developers to construct buildings or other private improvements, or. to pay for public improvements, such as streets, sidewalks, sewer and water, and similar improvements.

Developers making a large-scale investment that requires substantial public improvements may be able to use tax increment financing (TIF) to offset a portion of those costs. Local requirements may be included as part of this incentive.