Re-Making the Case for Tax Credits

By Michael J. Novogradac, CPA

Regular readers of this column are likely aware of the attention being paid in recent months to tax expenditures, tax reform and related topics. The tax extenders legislation that nine months ago was considered by many to be guaranteed to pass, instead stalled for months until it barely squeaked by, finally passing on January 16 during the lame duck session of Congress. Meanwhile, a string of proposals were released by groups such as the President's Economic Recovery Advisory Board and the National Commission on Fiscal Responsibility and Reform that suggested scaling back or eliminating tax credits as part of a fundamental reform the tax code.

 

 

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History and the Hill: Tax Bill Extends the 26 Percent GO Zone HTC

By John Leith-Tetrault, National Trust Community Investment Corporation

When the fifth anniversary of Hurricane Katrina was observed this past August, media coverage focused as it always does on New Orleans, pointing to both the positive recovery work that has been done and the difficult challenges that still remain. As one veteran preservationist who rode out the storm in her Lower Garden District home said, "The rebirth of New Orleans is going to be a marathon, not a sprint."

 

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Energy Prepayment Powers Virginia's Largest Solar Project

By Jennifer Dockery, Assignment Editor, Novogradac & Company LLP

A project that began as an academic exercise has, through sweat and stimulus funding, become the model for the largest solar array to date in Virginia. Developed by Staunton, Va.-based Secure Futures LLC (SFLLC), a soon-to-be-400 kilowatt (kW) solar project will provide energy to Eastern Mennonite University (EMU), a private university in Virginia's Shenandoah Valley. In November, EMU and SFLLC completed construction on a 104-kW array on the roof of the university's Sadie Hartzler Library, the first of two arrays that SFLLC will develop on the campus.

 

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Q&A: Unemployment and Foreclosures

By Amanda Talbot, HCCP, Novogradac & Company LLP

In light of the current economy, property managers of low-income housing tax credit (LIHTC) properties may have questions about households that recently have become eligible under the program's requirements due to recent changes in income.

Question 1: Do I annualize unemployment income for a tenant who is receiving unemployment benefits that are set to expire in less than 12 months?

Answer 1: Check with your state. The Department of Housing and Urban Development Handbook 4350.3 Revision 1, Change 3 (HUD Handbook 4350.3) says that "… the owner must use current circumstances to anticipate income … . Income that may not last for a full 12 months (e.g., unemployment compensations) should be calculated assuming current circumstances will last a full 12 months."

 

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Q&A: Grant Eligibility for Costs Incurred Prior to 2009

By Chad Durden, CPA, and Tony Grappone, CPA, Novogradac & Company LLP

Question: Are costs incurred in years prior to 2009 includable in eligible basis for a Section 1603 grant in lieu of energy tax credits?

Answer: Yes, but it depends on when construction began.

 

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News Briefs

Harvard University's Joint Center for Housing Studies published a policy brief that discusses issues facing the low-income housing tax credit (LIHTC) program beyond the immediate problems the recession created. READ MORE	The Department of the Treasury's Low-Income Housing Credit (LIHC) Compliance Unit relocated from Bensalem, Pa. to a new office in downtown Philadelphia. READ MORE
Rep. Keith Ellison, D-MN, introduced H.R. 6468, the Rental Housing Revitalization Act, designed to revitalize public housing structures in need of capital for repairs. READ MORE	The Virginia Department of Environmental Quality (DEQ) approved the state's first permit regulation for renewable energy projects. READ MORE
Not-for-profit National Dance Institute (NDI) established a new headquarters and the Center for Learning and the Arts at PS90, an L+M Development Partners' residential development in Harlem New York, N.Y. READ MORE	The Maryland Department of Planning issued final rules for the Sustainable Communities Tax Credit program. READ MORE
Duke Energy Generation Services recently completed and began commercial operation of its 6,000-acre, 51-megawatt (MW) Kit Carson wind power project near Burlington, Colo. READ MORE