IRS and Treasury Guidance

The Treasury Department and the Internal Revenue Service (IRS) announced they will temporarily suspend certain requirements for qualified low-income housing tax credit (LIHTC) projects located in areas affected by recent severe storms and flooding.

IRS Announcements:

Low-Income Housing Limits to Be Waived in Indiana and Iowa (June 19, 2008)

Relief for LIHTC Properties:

Notice 2008-61: Relief from Certain Low-Income Housing Credit Requirements Due to Severe Storms, Tornadoes, and Flooding in Wisconsin

IRS Comment Request for Notice 2008-61 (October 9, 2008)

Notice 2008-58: Relief from Certain Low-Income Housing Credit Requirements Due to Severe Storms, Tornadoes, and Flooding in Iowa

IRS Comment Request for Notice 2008-58 (October 9, 2008)

Notice 2008-56: Relief from Certain Low-Income Housing Credit Requirements Due to Severe Storms and Flooding in Indiana

Related Guidance:

Proc 95-28:IRS Provides Relief for Major Disaster Areas (superceded by Rev. Proc. 2007-54)
CCA 200134006 - IRC Section 42 and Casualty Losses

Legislation

H.R. 1424 Emergency Economic Stabilization Act of 2008
Introduced March 9, 2008 by Rep. Patrick Kennedy
Provides authority for the federal government to purchase and insure certain types of troubled assets for the purposes of providing stability to and preventing disruption in the economy and financial system and protecting taxpayers. Also provides a patch for the alternative minimum tax and extends the production tax credit (PTC) for wind energy for one year, the investment tax credit (ITC) for solar energy projects for eight years and the new markets tax credit (NMTC) for one year. Allows states to allocate an additional $8 per capita in low-income housing tax credit (LIHTC) amounts in 2008, 2009 and 2010 in the Midwestern Disaster Area. Also allows Texas and Louisiana to allocate $16 per capita in additional LIHTC amounts in 2008, 2009 and 2010 based on the populations of Brazoria, Chambers, Galveston, Jefferson and Orange counties in Texas and Calcasieu and Cameron parishes in Louisiana.

Cosponsors More information

Summary of Energy, Extenders, AMT and Disaster Tax Provisions in the Emergency Economic Stabilization Act of 2008 (October 1, 2008)

List of Counties Included in the Midwestern Disaster Area

Statement of Administration Policy Regarding H.R. 1424— Emergency Economic Stabilization Act of 2008, Energy Improvement and Extension Act of 2008, and Tax Extenders and Alternative Minimum Tax Relief Act of 2008 (October 3, 2008)

S. 3322 Midwestern Tax Relief Act of 2008
Introduced by Rep. Charles Grassley on July 23, 2008
To provides tax relief for victims of the Midwestern disaster in Arkansas, Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska and Wisconsin. The proposals are applicable to floods, severe storms, and tornadoes that are declared by FEMA on or after May 20, 2008, and before August 1, 2008. Disasters that occur prior to this period qualify for tax relief if the FEMA disaster declaration occurs during this period.