South Carolina Pauses Allocation of 4% Credits After Unexpected Demand
Officials with South Carolina’s State Fiscal Accountability Authority announced at a meeting Tuesday it has limited the ability of certain developments to access the state’s 4% low-income housing tax credit (LIHTC) incentive. The temporary stop halts the allocation of credits until the state enacts new legislation or July 1, 2022, whichever comes first. Minutes of the meeting state the pause is because “the volume of interest in the low-income housing tax credit program and the substantial impact on the [s]tate’s general fund were both unexpected.” According to the South Carolina Revenue and Fiscal Affairs Office’s Tax Expenditure Report issued earlier this month, the state LIHTC allocated more than $25 million in fiscal year 2021-22 and was estimated for more than $84.3 million this year.
The Novogradac Introduction to Low-Income Housing Tax Credits booklet provides an introduction to the LIHTC incentive, including the interaction of state and federal credits.