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Novogradac Journal of Tax Credits Volume 4 Issue 4

The April 2013 issue of the Novogradac Journal of Tax Credits.

Journal cover April 2013


Michael J. Novogradac

Monday, April 1, 2013

The Senate Budget Committee last month held a hearing on reducing the deficit by “eliminating wasteful spending in the individual and corporate tax code.” This hearing is the latest reminder that tax reform and deficit reduction will involve changes to tax expenditures, although it’s too soon to tell which expenditures will be affected or to what degree.

Sean B. Leonard

Monday, April 1, 2013

On July 30, 2008, the Housing and Economic Recovery Act of 2008 (HERA) was signed into law. A number of HERA’s provisions significantly affected projects financed with the proceeds of low-income housing tax credits (LIHTCs) under Internal Revenue Code (IRC) Section 42. Prior to HERA, the IRC required the seller of a building (or an ownership interest therein) in a LIHTC project post a bond to avoid recapture, if such sale was to occur prior to the end of the project’s 15-year tax credit compliance period. Recapture bonds were very expensive, making them virtually cost prohibitive. As a result, there were occurrences of early limited partner buyouts in the industry.

Annette Stevenson

Monday, April 1, 2013

Question: How do multiple community development entities (CDEs) investing in the same new markets tax credit (NMTC) project meet the new reporting requirements in Community Investment Impact System (CIIS) 10.0?Answer: Within 180 days of the allocatee’s fiscal year-end, the allocatee is required to report its NMTC transaction data in the Community Development Financial Institutions (CDFI) Fund’s online reporting system: CIIS. CDEs have been reporting increasing levels of transaction-related data for the past several years. The CDFI Fund uses the data for various reasons, including monitoring compliance with allocation agreements, determining the amounts and types of projects financed with NMTCs and collecting community and economic impact data.

Steven Varady and Stephen Tracy

Monday, April 1, 2013

Question: How much of the purchase price of a 100 percent membership interest in a solar project company (i.e., the underlying project assets) should be considered eligible for the energy investment tax credit (ITC) under Internal Revenue Code Section 48 or a Section 1603 grant payment (if chosen in lieu of the ITC)?Answer: Generally, it depends on the characteristics of the underlying assets of the project company. As explained below the answer to this question can be very subjective. Hence, practitioners have differing viewpoints.

News Briefs

Monday, November 26, 2018

The Texas Department of Housing & Community Affairs (TDHCA) established a new email address for multifamily project utility allowance requests...

Monday, April 1, 2013

The U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of Health and Human Services (HHS) announced nearly $98 million in Section 811 Project Rental Assistance Demonstration program funds will go to 13 state housing agencies...

Monday, April 1, 2013

Thanks to GCI’s Terrestrial for Every Rural Region of Alaska (TERRA) project, Alaskans along the state’s northwest coast will now have access to broadband services. Using new markets tax credits (NMTCs) provided by Travois New Markets and an investment from ...

Monday, April 1, 2013

In February, Comptroller of the Currency Thomas J. Curry spoke about affordable housing and community development finance to the National Association of Affordable Housing Lenders, specifically concerning public welfare investment authority...

Monday, April 1, 2013

New Jersey Gov. Chris Christie conditionally vetoed General Assembly Bill No. 3206. The bill would have increased the total amount given to the Neighborhood Revitalization State Tax Credit program from $10 million to $15 million and allowed...

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