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Senate Finance Committee Announces Tax Reform Working Groups

WASHINGTON – Jan. 15, 2015

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Senate Finance Committee Chairman Orrin Hatch, R-Utah, and Ranking Member Ron Wyden, D-Ore., today announced the co-chairs of the five working groups they created to advance tax-reform efforts in the 114th Congress. The groups will work with the Joint Committee on Taxation (JCT) to review current tax law, analyze available reform options and produce a comprehensive report that can serve as a foundation for bipartisan tax reform legislation. The report is expected to be released by the end of May.

The five working groups are community development and infrastructure, co-chaired by Sens. Dean Heller, R-Nev., and Michael Bennet, D-Colo.; business income tax, co-chaired by Sens. John Thune, R-S.D., Ben Cardin, D-Md.; individual income tax, co-chaired by Sens. Chuck Grassley, R-Iowa, Mike Enzi, R-Wyo., and Debbie Stabenow, D-Mich.; international tax, co-chaired by Rob Portman, R-Ohio, and Chuck Schumer, D-N.Y.; and savings and investment, co-chaired by Sens. Mike Crapo, R-Idaho, and Sherrod Brown, D-Ohio. The community and infrastructure group will encompass the low-income housing tax credit (LIHTC), the new markets tax credit (NMTC) and the historic tax credit (HTC), and the business tax reform group will encompass renewable energy tax credits (RETCs).

Tune into the Jan. 20 episode of the Tax Credit Tuesday podcast for more information.

Camp Introduces Tax Reform Legislation; Senate Finance Committee GOP Staff Releases Tax Reform Report

WASHINGTON – Dec. 11, 2014

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Today House Ways and Means Committee chairman Rep. Dave Camp, R-Mich., officially introduced H.R. 1, the Tax Reform Act of 2014. Camp’s legislation proposes formalizing the tax reform discussion draft released last February. It retains the low-income housing tax credit (LIHTC), doesn’t mention the new markets tax credit (NMTC) and proposes the repeal of the historic tax credit (HTC) and renewable energy tax credits (RETCs). Camp called for the legislation to “spur further action” during the 114th Congress, which begins in January.

Meanwhile, the U.S. Senate Finance Committee Republican staff today released a report titled “Comprehensive Tax Reform for 2015 and Beyond,” outlining issues that policymakers will face if they attempt comprehensive tax reform in the upcoming Congress. While LIHTCs, NMTCs, HTCs and RETCs are not specifically mentioned, the report calls for “permanence and certainty,” and indicates that some tax credits should be enhanced and made permanent.  

Tune into the Dec. 16 episode of the Tax Credit Tuesday podcast to learn more.

Stakeholders Urge Congress to Extend Tax Credits

WASHINGTON – Nov. 18, 2014

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Hundreds of tax credit advocates have recently sent sign-on letters to Congress, urging lawmakers to extend expired or expiring tax credits during the lame-duck session. In sign-on letters addressed to the House of Representatives and the Senate, more than 500 organizations asked Congress to extend seamlessly, enhance or make permanent the expired and expiring tax provisions. That letter said that failure to extend the provisions would effectively act as a tax increase and would inject instability and uncertainty into the economy.

Affordable Rental Housing ACTION (A Call to Invest in Our Neighborhoods) sent its own letter to Congress, urging an extension of the 9 percent low-income housing tax credit (LIHTC) minimum rate for new construction and substantial rehabilitation and the 4 percent LIHTC minimum for acquisition of affordable housing. The letter called for the floor rates to be made permanent, but said an extension for at least two years would strengthen the credit at virtually no cost to taxpayers. It featured signatures from a coalition of more than 900 national, state and local stakeholders.

Meanwhile, more than 1,500 organizations, including businesses, nonprofits and investors, signed a letter from the New Markets Tax Credit Coalition, urging Congress to extend the new markets tax credit (NMTC). The coalition letter argued that the economic activity spurred by NMTC investments has generated enough tax revenue to cover the cost of the program.

Tune into the Nov. 25 episode of the Tax Credit Tuesday podcast to learn more.

Stakeholders Urge CRA Guidance for HTC Investments

WASHINGTON – Nov. 18, 2014

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A group of 168 businesses, investors, nonprofit organizations and community leaders earlier this month sent a letter to federal bank regulators, urging them to expand and clarify the circumstances under which a federal historic tax credit (HTC) investment qualifies for Community Reinvestment Act (CRA) credit. Signatories asked that HTC transactions be automatically eligible for CRA credit if they are investments in low- and moderate-income areas that are designated economic development districts and have support from the local redevelopment agency. The letter argued that the HTC attracts private investments that can stabilize and revitalize economically underserved communities.

The letter was written in response to an invitation for public comment regarding proposed revisions to the Interagency Questions and Answers Regarding Community Reinvestment by the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency.

Tune into the Nov. 25 episode of the Tax Credit Tuesday podcast to learn more.

Amendments Made to Texas HTC Program

WASHINGTON – Nov. 17, 2014

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The Texas Historical Commission last week adopted amendments to clarify the type of entities that may apply for the state’s franchise tax credit for rehabilitation of a historic building. The amendments include a provision that specifies that non­profit and governmental entities may apply for the credit along with entities that are subject to the franchise tax. The amendments to the program regulations allow for separate ownership of the land and the structure on it, and certain leaseholds in the structure, to reflect similar standards for eligibility of projects un­der the federal rehabilitation tax credit program. The amendments become effective Nov. 20.

Tune into the Nov. 25 episode of the Tax Credit Tuesday podcast to learn more.

California Governor Vetoes State HTC

SACRAMENTO- Calif. – Sept. 30, 2014

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California Gov. Jerry Brown yesterday vetoed A.B. 1999, a bill to create a state historic rehabilitation tax credit (HTC). In his veto message, Brown said that he supported the bill’s goals, but that its $400 million cost should be weighed against other priorities during the state budget process. Tune in to today’s Tax Credit Tuesday podcast to learn more.

California Legislature Passes State HTC Bill

WASHINGTON – Sept. 8, 2014

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The California State Legislature passed a bill Aug. 27 that would establish a state historic rehabilitation tax credit (HTC). A.B. 1999 would provide a 20 percent tax credit for qualified rehabilitation expenditures to historic structures, or a 25 percent credit if the historic project is located on federal or state surplus property; includes affordable housing; is located in a designated census tract; is part of a military base reuse authority; or is a transit-oriented development. The bill would authorize $50 million annually from calendar year 2015 through 2022, including a $10 million set-aside for projects with less than $1 million in qualified rehabilitation expenditures. It’s expected the bill will be sent to Gov. Jerry Brown shortly for his consideration; the deadline for Brown to sign the bill is Sept. 30.  

Tune into the Sept. 9 Tax Credit Tuesday Podcast to hear more about the bill.

Wisconsin HTC Moratorium Lifted

WASHINGTON – July 16, 2014

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Wisconsin Gov. Scott Walker recently announced that the Wisconsin Economic Development Corporation (WEDC) will lift the moratorium on the Historic Preservation Tax Credit program. The moratorium was placed on the state credit June 23 because of higher than expected demand for the credit. WEDC will also begin collecting additional information under the Historic Preservation Tax Credit program with regards to the return on investment to the state, including projected employment, wages, leverage of investment, local participation, tax impact and other relevant information.

Tune in to next week’s Tax Credit Tuesday podcast to learn more.

National Trust Releases HTC Impact Report

WASHINGTON – July 1, 2014

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The National Trust for Historic Preservation recently released The Federal Historic Tax Credit: Transforming Communities report. The report examines how the historic tax credit (HTC) program has created private capital and jobs, rehabilitated historic structures and revitalized communities across the country. It also specifically examines the HTC’s effect on six cities: Macon and Atlanta, Ga.; Baltimore and Silver Spring, Md.; and Ogden and Salt Lake City, Utah.

Check out the August issue of the Novogradac Journal of Tax Credits to learn more about the report.

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