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Missouri Commission Recommends Accelerated Redemption for Half of State LIHTCs

Thursday, June 24, 2021 - 9:45AM

A report by the Missouri Housing Development Commission recommends that the state allow accelerated redemption for up to 50% of state low-income housing tax credits (LIHTCs), an increase from 20% in a pilot program. Missouri’s state credit is generally redeemed ratably over a 10-year period and the accelerated program allows recipients to redeem 71% of the credits in the first five years. The study committee found that accelerating redemption of the state LIHTC increased the equity pricing by more than 10 cents per tax credit dollar, which could mean an additional 86 units of affordable housing could be built annually with no increase in spending.

The Novogradac Introduction to Low-Income Housing Tax Credits booklet provides the basics of the LIHTC incentive, including the interaction of state and federal credits.

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