Tax Credit Program
Low Income Housing Tax Credit (LIHTC)
Affordable Housing Tax Credit
· Created as part of tax reform act of 1986
· Replaced previous policies with a successful private-public partnership that ensures the development of housing for low- and moderate-income Americans
· Since its inception, the program has financed the construction of more than 2.5 million affordable family and senior homes
Tax Credit Application Process
· Department of the Treasury issues tax credit allocation authority to all States
· The Texas State agency (TDHCA) develops criteria by which the tax credits are allocated to developers in order to construct housing
· Properties must remain affordable for at least 30 years.
· The tax credits, which are awarded via a competitive application process, are syndicated from the developers to investors, who in return provide equity for construction financing
· Provides rental homes for families at or below 60 percent of area median income
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