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Each month the Internal Revenue Service publishes the housing credit percentages that apply to low-income rental housing buildings placed in service that month. There are two separate ratesone for the 70% present value credit (PVC), and one for the 30% present value credit. The maximum 70% rate is available for low-income new construction and substantial rehabilitation expenditures that are not federally subsidized. The maximum 30% rate applies to low-income property acquisition expenditures and federally subsidized low-income new construction or substantial rehabilitation expenditures.
Please contact IHCDA Real Estate Production Staff to learn more.
UPDATE: The American Taxpayer Relief Act of 2012 has extended the 9% low-income housing tax credit rate floor to projects receiving low-income housing tax credit allocations before January 1, 2014. The rate had been scheduled to return to a floating rate for projects placed in service on or after December 31, 2013.
The June 2012 housing credit percentages are as follows:
7.48 for the 70% present value credit
3.21 for the 30% present value credit
Click here to access the Housing Credit Applicable Percentages - Updated May 15, 2013
* Note: The Housing and Economic Recovery Act of 2008 set a 9% minimum tax credit percentage rate for the 70% credit for new and substantially rehabilitated buildings placed in service after July 30, 2008 and before December 31, 2013. This minimum tax credit percentage rate is applicable only to the 70% credit. The August ’08 applicable percentages shown above were set by the IRS in Revenue Ruling 2008-43. The September ’08 applicable percentages shown above were set by the IRS in Revenue Ruling 2008-46, which does not discuss the enactment of the Housing and Economic Recovery Act of 2008.