U.S. Senators Reject Tax Bill with Housing Credit Improvements
(Aug. 6, 2024) On Aug. 1st, the U.S. Senate failed to secure the 60 votes necessary to proceed with consideration of the Tax Relief for American Families and Workers Act, which passed the House in January by a bipartisan vote of 357-70.
Among the bill’s provisions are two improvements to the Low-Income Housing Tax Credit (LIHTC) program, which would increase the supply of affordable LIHTC homes by 200,000 over the next 10 years. The first provision would restore, for 2023-2025, the 12.5 percent increase in 9 percent Housing Credit authority the program lost after a temporary increase expired in 2021. The second provision would lower the bond financing threshold from 50 percent to 30 percent for 4 percent Housing Credit developments financed with bonds that have an issue date prior to 2026. This change would be particularly helpful in the 20 states whose private activity bond caps are oversubscribed.
Other provisions in the Tax Relief for American Families and Workers Act would have expanded the Child Tax Credit and other tax policies; these provisions, rather than the LIHTC, were the ones that garnered opposition to the bill by 44 senators; 48 senators supported the bill.
About 30 percent of the nation’s almost three million LIHTC units serve older adults, which are a key part of financing for the preservation and expansion of affordable housing. LeadingAge supports the proposals to improve the LIHTC; the association had previously urged members to reach out to their senators to urge them to support affordable housing by voting to advance the legislation and will continue its work to enact a larger package of LIHTC improvement and expansion proposals within the separate Affordable Housing Credit Improvement Act (H.R. 3238/S. 1557).
Contact: Annalyse Komoroske Denio, akomoroskedenio@leadingageny.org, 518-867-8866