House Ways and Means Committee member Pat Tiberi (R-OH) and Ranking Member Richard Neal (D-MA) introduced the Affordable Housing Credit Improvement Act of 2017 on March 21, 2017. Designed to strengthen the Low-Income Housing Tax Credit (LIHTC) and help ensure affordable housing, the legislation is a companion to a Senate bill introduced by Maria Cantwell (D-WA) and Finance Committee Chairman Orrin Hatch (R-UT) earlier this month. More information on the Senate legislation can be found here.
Although the Tiberi/Neal legislation omits a Senate proposal to expand the LIHTC by 50 percent, key provisions in the bill would:
- Create a permanent minimum 4 percent LIHTC rate for acquisition and for Housing Bond-financed properties; and
- Permit income averaging within LIHTC properties in order to provide more flexibility and responsiveness to local needs.
While the House Republican Blueprint for tax reform is silent on the fate of the LIHTC, NMHC/NAA have learned that members of the Ways and Means Committee have expressed strong support for retaining the credit as tax reform moves forward. The Tiberi/Neal bill is indicative of this commitment. NMHC/NAA are also working with the Ways and Means Committee to ensure that tax reform legislation that reduces the corporate tax rate does not harm equity raised by the LIHTC.
Separate from the LIHTC bill, Rep. Tiberi, joined by Ways and Means Committee member Danny Davis (D-IL) teamed up to on March 7 introduce the Preserving Investment in Neighborhoods Act. The measure would extend to partnerships the exemption from federal income tax upon the receipt of state or local economic development and infrastructure funds. Under current law, only corporations are eligible for a tax exemption from the receipt of such assistance. Immediate taxation of state and local development funds to partnerships inhibits community investment and can make projects unfeasible. Recently, NMHC/NAA joined our real estate partners in a letter expressing strong support for the bill.
- Legislation that Proposes Expansion of LIHTC Garners Bipartisan, Bicameral Support
- Treasury and IRS Extend NMHC-Supported LIHTC Deadline
- NMHC Weighs in with Treasury Regarding LIHTC Income Averaging Regulations
- IRS Issues Proposed LIHTC Income Averaging Regulations
- IRS Provides Tax Relief to LIHTC Projects Due to COVID-19