While Congress’ first priority was to avert the “fiscal cliff,” by passing H.R. 8, the American Taxpayer Relief Act of 2012, Congress also ensured the viability of the Low Income Housing Tax Credit (LIHTC) and New Markets Tax Credit (NMTC) programs, which are critical to housing and economic development in Indian Country.
This bill was important for many reasons, but these two provisions are imperative to our clients and our industries:
- It extended the fixed 9 percent tax credit rate for allocations made before January 1, 2014. Without this provision, the 9 percent credit rate would’ve expired for all projects not placed in service by Dec. 31, 2013, essentially eliminating the opportunity for this increased equity for projects not already under construction. Fixing the rate for another year provides the opportunity for more equity from an investor and ensures the greater viability of LIHTC projects.
- It extended the New Markets Tax Credit program for another two years. The program will allocate $3.5 billion in tax credit authority for applications already received in 2012 (though not yet announced) and another $3.5 billion for applications expected to be submitted in 2013. Travois New Markets applied for an allocation of tax credits in 2012, and we will keep you posted on when the announcements are made.
Please feel free to email me at elizabeth@travois.com with any questions or if you would like to learn more about the Low Income Housing Tax Credit or New Markets Tax Credit programs.
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Are there any LIHTC available for LIH to be built on the Navajo Nation? I’m the CFO for NN Economic Development. Working with Navajo veterans in leveraging their equity. We also have a TDHE, whom, could place some funding to the project. I would suppose the Nation/s TDHE could be the platform to administer the TDHE and all the other funds for veteran home construction.
Thank you for your interest in the Low Income Housing Tax Credit program. Each state has a different application schedule, and the 2013 LIHTC application period has passed for Arizona and New Mexico. Funding will be available again in 2014 and onward for affordable housing on the reservation through this program. One of our staff members will contact you soon to discuss your needs and future plans.