Neighborhood Government Act

Neighborhood Government Act - Amends the Internal Revenue Code to allow individuals nonrefundable income tax credits for a portion of the amounts contributed by them to neighborhood corporations which provide municipal services. Limits the amounts allowable to different percentages of the individuals contributions, depending on the individual's income, and ranging from 80 percent of contributions by persons making not more than $10,000 in taxable income to ten percent of contributions by individuals with taxable incomes greater than $25,000.

Authorizes the Secretary of the Treasury to pay neighborhood corporations a percentage of the non-Federal taxes paid by each of their members which is equal to the same percentage of neighborhood contributions each member is allowed a credit. Allows the Secretary to reduce such payments where there are insufficient funds to make the payments, and to require such reports and accounting procedures as are necessary to account for Federal funds. Directs the Secretary to report to Congress annually on payments made and reports received under this program. Authorizes all necessary appropriations for the purpose of this Act.