Tax Reform Could Impact Affordable Housing

Congress is proposing to gut LIHTC in the house version of the tax reform bill, as illustrated in a recent article (http://bit.ly/lihtcnh) by Kenneth Viscarello, Attorney at Sheehan Phinney, published in the NH Business Review. Attorney Viscarello outlined the proposed impacts in terms relevant to the housing market and means of financing such projects that we face in New Hampshire, and points out a couple of key changes that especially relate to the for-profit developers of affordable housing in this state.

The current code supports a public-private partnership that is essential to providing adequate stock of affordable housing, since the government can’t (and many say shouldn’t) be charged to meet the need, both from an efficiency standpoint and that of practicality.  Without the corporate tax exposure, need to buy these tax credits by the primary purchasers today will be reduced, and, as Attorney Viscarello points out, there are no other offsets to benefit LIHTC.  While not a one-dimensional issue, this impact is important to consider.

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Matthew Bacon, MiCP

Commercial Real Estate Advisor

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