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What is the low income housing tax credit?

What is the low income housing tax credit?

Housing Tax Credit Program The Low-Income Housing Tax Credit (LIHTC) program is a tax incentive program designed to increase the supply of quality, affordable rental housing by helping developers offset the costs of rental housing developments for individuals with low- to moderate-income.

Are there any tax credits for affordable housing in Ohio?

Developers constructing or rehabilitating affordable housing statewide can apply for an allocation of 9% Housing Tax Credits. Due to the demand for 9% credits, OHFA typically funds only 25 to 30 percent of all applications submitted.

Where to apply for the housing tax credit?

Application materials can be found on the Guidelines, Applications, and Forms page. The Qualified Allocation Plan (QAP) is the guiding policy document for both competitive and non-competitive housing tax credits.

What are the requirements for a 4% tax credit?

The Internal Revenue Code (IRC) requires that developments awarded 4% Housing Tax Credits must utilize multifamily bonds financing for more than 50 percent of the total project cost.

What is the low income housing tax credit program?

The low-income housing tax credit is a United States federal subsidy program that was enacted in 1986. The aim of this initiative is to provide incentives for the development of housing for low-income individuals in every state.

What is low income tax?

Most low-income households do not pay federal income taxes, typically because they owe no tax (as their income is lower than the standard deduction) or because tax credits offset the tax they would owe. Some receive substantial rebates via refundable tax credits.

How does the low-income housing tax credit work?

How Does the Low-Income Housing Tax Credit Work? The federal government gives money to every state for low-income housing tax credits, based on population . Each state has a housing agency that awards the tax credit money to groups of developers according to a plan developed by the state.

How does LIHTC work?

The LIHTC provides funding for the development costs of low-income housing by allowing an investor (usually the partners of a partnership that owns the housing) to take a federal tax credit equal to a percentage (up to 70% or 30% of PV (Property Value) depending on the credit type) of the cost incurred for development of the low-income units in a

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