Advocacy Update

Forrest WallWritten by Forrest Wall, CAE, Staff Vice President  and Industry Relations

NAHB Continues Push For Affordable Housing Credit Improvements Act

Although the recent Congressional approval of a $1.3 trillion spending bill includes marginal improvements to the Low Income Housing Tax Credit (LIHTC) program, the National Association of Home Builders (NAHB) continues its advocacy for a piece of additional legislation that would enhance the credit. This legislation, called the Affordable Housing Credit Improvements Act (AHCIA), enjoys bipartisan support and if approved would promote the construction of multifamily rental housing. The AHCIA would achieve this by making permanent the 4% credit rate for acquisition and bond-financed projects, thus providing more certainty and flexibility in financing affordable housing projects. Additionally, the legislation would allow energy tax incentives to be used in combination with LIHTCs, and help combat local opposition to affordable housing by prohibiting local approval and certification requirements. NAHB estimates it would result in an additional 400,000 LIHTC units over the next 10 years.

Fix Needed For Depreciation Error Under Tax Reform

The National Multifamily Housing Council (NMHC) is seeking a fix to a wording problem in last year’s tax reform legislation which affects the apartment industry. The intent of the language in the law was to allow all companies to choose to deduct business interest, and if they do so they must depreciate the property over 30 years (instead of 27.5 years). The error comes in that the statute can be interpreted to read that 30 year depreciation is only available for properties that are placed in service after 2017, with existing properties left to be depreciated over 40 years. NMHC is seeking either a legislative correction via Congress or Trump administration guidance on the issue.

 

This entry was posted in 2018, June 2018. Bookmark the permalink.