Notes from Novogradac
The Internal Revenue Service (IRS) has moved one step closer to releasing long-awaited guidance on the Opportunity Zones (OZ) incentive. On Sept. 12, the IRS sent proposed OZ regulations to the Office of Information and Regulatory Affairs (OIRA), a division of the White House Office of Management and Budget (OMB).
Now that the opportunity zone (OZ) nomination and designation process has been completed and the Internal Revenue Service (IRS) has published an initial list of 15 frequently asked questions, community and economic development practitioners and policy makers are now focusing on soon to be released proposed regulations from the IRS.
Some believe the affordable housing crisis is an urban or even inner-city problem, but new research from the Housing Assistance Council (HAC) highlights the fact that there is a crisis in rural America as much as there is for urban American. Furthermore, HAC’s research shows that not only has the low-income housing tax credit (LIHTC) proven instrumental in creating affordable housing but it has also created this housing in rural parts of the country where the need for such housing is greater than many imagine.
The Internal Revenue Service (IRS) is currently working on guidance on how the qualified opportunity zone (OZ) benefit under Internal Revenue Code (IRC) 1400Z-2 will be administered. Thus far, the IRS has posted a list of Frequently Asked Questions about OZs with additional guidance in the form of interim regulations anticipated in the very near future.
On Sept. 13, the U.S. Census Bureau the released the 2017 American Community Survey (ACS) data. With the release of the 2017 ACS data, Novogradac & Company is able to estimate the national median income, state median incomes as well as low-income housing tax credit (LIHTC) income limits for many areas through 2020.
About the Calculations
The (ACS) is an integral part of HUD’s calculation of area median income. The 2018 ACS data will be used by HUD to calculate the 2020 income limits for LIHTC and Section 8 properties.
On Aug. 31, the U.S. Department of Housing and Urban Development (HUD) released the fair market rents (FMR) for fiscal year (FY) 2019.
Under H.R. 6627, legislation introduced by two members of the House Ways and Means Committee, Reps. Jason Smith, R-Miss., and Terri Sewell, D-Ala., an additional $1 billion in new markets tax credit (NMTC) allocation authority would become available to community development entities (CDEs) that commit to investing in rural jobs zones. The legislation defines a rural jobs zone as any area outside a city or town with a population of 50,000 or more and its immediate adjacent urbanized area, using the definition of areas eligible for assistance under the U.S.
Each year the U.S. Department of Housing and Urban Development (HUD) publishes a list of difficult to develop areas (DDAs). Low-income housing tax credit properties located in areas that are designated as DDAs are eligible for a 130 percent boost in eligible basis for determining the amount of LIHTCs a building can generate.
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