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Novogradac Journal of Tax Credits Volume 11 Issue 5
Abridged version of the May 2020 issue of the Novogradac Journal of Tax Credits. For more content, please subscribe to the Journal.
Business and industries across the economic spectrum have been impacted by the onslaught of COVID-19. The historic tax credit (HTC) world is no exception.
New markets tax credit (NMTC) participants are facing a slew of challenges because of the COVID-19 pandemic.
As the COVID-19 pandemic continues, federal, state and local agencies are working together to mitigate both the health and economic fallout.
In a recent letter, the Novogradac Opportunity Zones (OZ) Working Group submitted a request to the Department of the Treasury (Treasury) and the Internal Revenue Service (IRS) seeking relief from certain provisions concerning the opportunity zones incentive due to the COVID-19 pandemic.
The COVID-19 pandemic is wreaking havoc across the nation and has brought an unprecedented shuttering of the United States economy as the entire American population has been under some form of social distancing, quarantine or isolation.
According to an annual report released by the National Park Service (NPS) in March, the federal historic tax credit (HTC) generated more than $5.7 billion in private investment in historic and community revitalization in fiscal year (FY) 2019. The NPS issued 1,042 certifications of completed work in FY 2019, including 9,716 new housing units and 6,564 rehabilitated housing units. Since 1977, the HTC has resulted in an estimated $102.6 billion in rehabilitation investment in 291,828 buildings, according to the NPS.
The Internal Revenue Service published a noticed in the March 31 Federal Register seeking comment on IRS Form 8874-A, Notice of Qualified Equity Investment for New Markets Tax Credit. There are no changes recommended for the form. The review is part of an effort to reduce paperwork and respondent burden as required by the Paperwork Reduction Act of 1995. Comments will be accepted through June 1.
New Mexico Gov. Michel Lujan Grisham signed legislation Feb. 19 to create a state solar market development income tax credit. S.B. 29 creates a credit for 10 percent of the purchase and installation of solar thermal or photovoltaic systems from March 1, 2020, until Dec. 31, 2027. The annual statewide cap is $8 million on a first-come, first-served basis, with a taxpayer cap of $6,000 per year.
The U.S. Department of Housing and Urban Development (HUD) posted income limits March 31 to determine eligibility for HUD-assisted programs in fiscal year 2020. The limits went into effect April 1 and cover public housing, Section 8, Section 202 and Section 811. HUD simultaneously released Multifamily Tax Subsidy Program income limits for 2020, which are used to determine eligibility for low-income housing tax credit (LIHTC) and tax-exempt bond properties.
Colorado Housing Finance Authority (CHFA) sent a notice March 16 detailing updated compliance information during the COVID-19 pandemic. The notice stated that on-site tax credit and CHFA loan compliance monitoring and site visits were delayed until May 1. The notice also reiterated that several U.S. Department of Housing and Urban Development inspections and reviews have been suspended indefinitely.