Recent News

Wednesday, December 22, 2021

The future of the Build Back Better Act (BBBA) and related community development incentives after Sen. Joe Manchin’s announcement that he would not vote for the legislation is the subject of this week’s Tax Credit Tuesday episode. Michael Novogradac, CPA, is joined by Peter Lawrence, Novogradac director of public policy and government relations, and Tony Grappone, CPA, to discuss what’s next for potential tax extenders legislation, what tax incentive provisions could be included in a future version of the BBBA and more.

Tuesday, December 14, 2021

The Office of the Comptroller of the Currency (OCC) today issued a final rule to rescind the Community Reinvestment Act (CRA) rule it issued in June 2020. Today’s action replaces the 2020 rule with a rule based on rules adopted by the OCC, Federal Reserve and Federal Deposit Insurance Corporation (FDIC) in 1995, as amended. The final rule applies to national banks, federal savings associations and state savings associations. The updated rule takes effect Jan. 1, 2022.

Friday, November 19, 2021

The U.S.  House of Representatives today passed the Build Back Better Act, a $1.7 trillion bill that includes an expansion of the low-income housing tax credit (LIHTC), the introduction of the neighborhood homes tax credit (NHTC), an additional tribal allocation of the new markets tax credit (NMTC) and $325 billion in renewable energy tax incentives. H.R. 5376 passed 220-213 and now goes to the Senate. The legislation includes an extension of the 12.5% increase in 9% LIHTC allocations that began in 2018 through 2024, adding a 10% increase, plus an annual inflation adjustment, to that amount. The bill also would reduce the 50% test for affordable rental housing financed with private activity bonds (PABs) to 25% for calendar years 2022-26, establish a 50% basis boost for extremely low-income housing and provides a 30% basis boost for LIHTC properties in tribal areas.

Monday, November 15, 2021

The Internal Revenue Service (IRS) published a notice today providing a 1.2049 inflation adjustment factor for Internal Revenue Code (IRC) Section 45Q carbon oxide sequestration credits. The Notice 2021-35 inflation adjustment means the credit for calendar year 2021 is $24.10 per metric ton of qualified carbon oxide under IRC Section 45Q(a)(1) and $12.05 per metric ton of qualified carbon oxide under IRC Section 45Q(a)(2).

Wednesday, November 3, 2021

Democrats in the House of Representatives today released revised text for the Build Back Better Act (H.R. 5376), which includes an expansion of the low-income housing tax credit (LIHTC), the neighborhood homes tax credit (NHTC) and a $175 million tribal allocation for the new markets tax credit (NMTC) for 2022. The revised legislation retains $555 billion in tax and spending proposals for clean energy with minor changes. The LIHTC provisions include the extension of the 12.5% increase in 9% allocations that began in 2018 as part of the baseline during 2022-2024, adding annual 10% plus inflation increases for 2022-24 to those amounts, but reverting to the 2017 baseline as adjusted for inflation in 2025. It also would reduce the 50% test for affordable rental housing financed with private activity bonds (PABs) to 25% for five years (2022-26) and establish the 50% basis boost for extremely low-income housing, with the set-aside reduced from 10% to 8%, and a 30% basis boost for LIHTC properties in tribal areas.

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