Notes from Novogradac
The Internal Revenue Service (IRS) released 2019 population figures in Notice 2019-19, indicating the 2019 low-income housing tax credit (LIHTC) ceiling and tax-exempt private activity bond (PAB) cap for all states will increase. From 2018-2019, the U.S. population increased by 1,448,256 people to 327,167,434 in total, representing a 0.4 percent gain. U.S. territories lost more than 140,000 people, a 3.8 percent decrease.
As changes to Community Reinvestment Act (CRA) regulations are considered and developed, it is imperative to consider how those changes could affect regulated financial institutions and their investment and lending activities.
In the affordable housing community, the concept of opportunity areas has drawn increasing interest and consideration, particularly in recent research. For housing advocates, understanding what constitutes a high opportunity area and how living there can benefit low-income residents will inform decisions on where to locate affordable rental housing so that the best possible outcomes are realized by residents.
Like little children on the eve of their birthday, from tenant to landlord to investor, people around the country are anxiously awaiting the 2019 Department of Housing and Urban Development (HUD) income limits (or maybe it is just the few of us who have chosen to read this blog post). Either way as the calendar turns to a new year, our thoughts turn to HUD income limits.
When will income limits be released?
New data about existing affordable rental housing paints a worsening picture of the affordable housing crisis. Recent research by the University of Pennsylvania shines a light on the potential loss of more than 1 million homes of federally subsidized housing from the affordable housing stock. The major threats to affordable housing are highlighted, including how changes in funding can lead to housing loss. Current events put this particular risk factor in stark relief – the ongoing partial government shutdown is exacerbating and accelerating the problem of preservation, with 1,150 U.S.
Harvard’s Joint Center for Housing Studies (JCHS), as part of its ongoing analysis of the State of the Nation’s Housing Report, recently released a look at characteristics of older adult households. Housing America’s Older Adults 2018, the latest in a series of JCHS reports on housing older adults, looks at 2016 data for older adult households, those headed by individuals 50 years of age or older.
Not all states issue multifamily private activity bonds (PABs) each year, and the number of states issuing no multifamily PABs has varied widely since 2000, according to data reported by the Council of Development Finance Agencies (CDFA). The lowest number of states issuing no multifamily PABs was 2003, with only seven states reporting no issuance of multifamily PABs. With the onset of the financial crisis, that number grew to 30 in 2011. As the nation recovered, the number of states issuing no multifamily PABs fell to 10 in 2016, increasing slightly to 11 in 2017.
As more and more developers and state agencies explore income averaging, one of the biggest questions is what happens if a unit goes out of compliance. Unfortunately, this is a difficult question to answer without knowing the details of the low-income housing tax credit (LIHTC) project, and in some cases without more information from the IRS. This discussion will examine some of the most hotly discussed topics around non-compliance in LIHTC projects that have elected the average income minimum set-aside.
Impact of the Minimum Set-Aside
The Internal Revenue Service published Revenue Procedure 2018-55, announcing the amounts of unused low-income housing tax credit (LIHTC) carryovers allocated to qualified states for calendar year 2018. The $2.69 million of unused LIHTC carryovers was placed in a national pool and reallocated to 32 qualified states and Puerto Rico.
About the National Pool
Housing stakeholders often have difficult choices to make due to various constituent needs, housing policy directives, and limited resources with which to work. As 2020 approaches, another issue is looming on the horizon: low-income housing tax credit (LIHTC) properties that will start to reach “year 30,” the year in which some LIHTC properties are no longer obligated to adhere to income and affordability requirements.
- 1 of 14
- next ›