IRS Publishes Population Figures for CY 2022 LIHTC, PAB Cap
The Internal Revenue Service Monday published the population figures used to calculate calendar year 2022 low-income housing tax credit (LIHTC) and private activity bond (PAB) limits for all 50 states, Washington, D.C., and U.S. territories under Notice 2022-12. The notice reveals a national population increase of 0.7%.
Nationally, the 9% population-based LIHTC will decrease by 6.9% ($66.4 million) because of the December 2021 expiration of the 12.5% increase in 9% allocations that was enacted in the fiscal year 2018 omnibus spending bill. It is possible that expiration could be retroactively addressed in reconciliation or tax extender legislation later this year. Under Notice 2022-12, PAB allocations will increase 5.1% ($2 billion).
The 2022 LIHTC cap for each state is the greater of two figures:
- The state population multiplied by $2.60, or
For PABs, the cap for each state is the greater of:
- The state population multiplied by $110, or
The $2.60 LIHTC multiplier is the lowest since 2017, when it was $2.35. The $2,975,000 small-state minimum for LIHTCs decreased by $270,625 from 2021. The PAB multiplier stayed the same ($110), but the small-state minimum for PABs increased from $324,995,000 in 2021 to $335,115,000 in 2022.
The result is slightly less LIHTC allocation and more PAB allocation in 2022. Nationwide LIHTC allocation authority for 2022 will be more than $870 million, down from about $935 million in 2021. Nationwide PAB allocation authority will be approximately $39.8 billion in 2022, compared to $39.3 billion in 2021. It is important to note that the new PAB allocation authority does not include any unused PABs that states have carried forward from the previous three years.
Below are a few additional takeaways.
From 2021 to 2022, the U.S. population increased by 2,409,622 residents to 331,893,745 people, a gain of 0.7%. The increase is more than twice as high as the 0.3% population increase from 2020 to 2021.
Gaining population: New York gained the most population from 2021 to 2022, with a 2.6% jump of 499,137 residents, ahead of New Jersey, which gained the second-most residents, with a 4.3% increase of 384,759. The remainder of the top 10 states to gain population, in order of nominal population increase, were:
3. Pennsylvania (1.40%, 180,802 more residents)
4. Texas (0.56%, 167,182 more residents)
5. Alabama (2.4%, 118,345 more residents)
6. Maryland (1.8%, 109,327 more residents)
7. Massachusetts (1.3%, 91,149 more residents)
8. Georgia (0.8%, 89,549 more residents)
9. Tennessee (1.3%, 88,384 more residents)
10. Utah (2.7%, 88,069 more residents)
Losing population: The 10 states (including Washington, D.C.) that lost population from 2021 to 2022, in order of nominal population loss were:
- Arizona (1.95%, 145,085 fewer residents)
- California (0.33%, 130,242 fewer residents)
- North Carolina (0.47%, 46,661 fewer residents)
- District of Columbia (6.0%, 42,766 fewer residents)
- South Carolina (0.5%, 27,335 fewer residents)
- Louisiana (0.46%, 21,271 fewer residents)
- Mississippi (0.6%, 16,821 fewer residents)
- Arkansas (0.15%, 4,631 fewer residents)
- Wyoming (0.60%, 3,525 fewer residents)
- West Virginia (0.10%, 1,828 fewer residents)
Losing streaks: West Virginia’s population has decreased every year since 2014 when its population was 1,854,304. Louisiana’s population has decreased for four consecutive years, since its population was 4,684,333 in 2018. California has lost population every year since 2019, when the population was 39,557,045. And, Mississippi’s population has also decreased every year since 2019 when its population was 2,986,530.
Most populous states: California (39,237,836), Texas (29,527,941), Florida (21,781,128) and New York (19,835,913) remain the highest-population states by a significant margin. The remaining top-10 states by population are:
5. Pennsylvania (12,964,056)
6. Illinois (12,671,469)
7. Ohio (11,780,017)
8. Georgia (10,799,566)
9. North Carolina (10,551,162)
10. Michigan (10,050,811)
Receiving the small-state LIHTC minimum: The District of Columbia and eight states will receive the small-state minimum LIHTC allocation of $2,975,000.
- District of Columbia,
- North Dakota,
- Rhode Island,
- South Dakota,
- Vermont, and
Four of the five U.S. territories–all but Puerto Rico–will also receive the small-state minimum.
Receiving less 9% LIHTC allocation than 2021: Forty-two states will see a decrease in their 9% LIHTC allocation in 2022 as compared to 2021, as a result of the multiplier changing from $2.81 in 2021 to $2.60 in 2022, but being large enough to receive more than the small-state minimum.
Receiving small-state PAB minimum: The small-state minimum of $335,115,000 in bond allocation will go to the following states (and the District of Columbia):
- District of Columbia
- New Hampshire
- New Mexico
- North Dakota
- Rhode Island
- South Dakota
- West Virginia
U.S. territories: The combined population of five U.S. territories (American Samoa, Guam, Northern Mariana Islands, Puerto Rico and U.S. Virgin Islands) increased by 68,564 people–nearly 2%. Guam and Puerto Rico saw population increases from 2021 to 2022.