INCOME HOUSING TAX CREDIT
QUESTIONS AND ANSWERS
Low-Income Housing Tax Credit - ANSWER-One of the federal government's primary
policy tools for encouraging the development and rehabilitation of affordable rental
housing
Affordable Rental Housing - ANSWER-Nice apartments that are intended to be rented
by people who fall into the low income designation
Qualified Rental Projects - ANSWER-*Projects that meet the criteria to receive
nonrefundable federal housing tax credits
Income Test - ANSWER-Determines the maximum income a LIHTC tenant may have
Extended Use Period - ANSWER-Although tax credits are claimed annually over 10
years, the investment compliance period continues until the end of the 15th year, and
the project must remain affordable for at least 30 years. This 30-year restriction period,
including the 15-year compliance period
Housing Finance Authorities - ANSWER-State-chartered authorities established to help
meet the affordable housing needs of the residents of their states.
Allocation - ANSWER-Process that begins at the federal level with each state receiving
an annual LIHTC allocation in accordance with federal law
Qualified Allocation Plans (QAP) - ANSWER-Sets out the state's eligibility priorities and
criteria for awarding federal tax credits to housing properties
QUESTIONS AND ANSWERS
Low-Income Housing Tax Credit - ANSWER-One of the federal government's primary
policy tools for encouraging the development and rehabilitation of affordable rental
housing
Affordable Rental Housing - ANSWER-Nice apartments that are intended to be rented
by people who fall into the low income designation
Qualified Rental Projects - ANSWER-*Projects that meet the criteria to receive
nonrefundable federal housing tax credits
Income Test - ANSWER-Determines the maximum income a LIHTC tenant may have
Extended Use Period - ANSWER-Although tax credits are claimed annually over 10
years, the investment compliance period continues until the end of the 15th year, and
the project must remain affordable for at least 30 years. This 30-year restriction period,
including the 15-year compliance period
Housing Finance Authorities - ANSWER-State-chartered authorities established to help
meet the affordable housing needs of the residents of their states.
Allocation - ANSWER-Process that begins at the federal level with each state receiving
an annual LIHTC allocation in accordance with federal law
Qualified Allocation Plans (QAP) - ANSWER-Sets out the state's eligibility priorities and
criteria for awarding federal tax credits to housing properties
