Origin: The Low-Income Housing Tax Credit (LIHTC) is available to corporate excise taxpayers as well that invest in low-income housing projects that meet federal and state eligibility rules. The credit is part of a federal program that authorizes a federal credit for such investments and subsidizes state credits for eligible projects. The Executive Office of Housing and Livable Communities (EOHLC) DHCD), determines eligibility for, and the amount of, the Massachusetts credit pursuant to federal guidelines. The LIHTC has two components. First, the Standard LIHTC is allowed for the construction or development of new low-income housing or the preservation and improvement of existing federal or state subsidized housing. Second, the Donation LIHTC is allowed for the donation of real or personal property to non-profit entities for use in purchasing, constructing, or rehabilitating housing projects otherwise eligible for the LIHTC. The amount of credit that Massachusetts taxpayers may claim is determined by the EOHLC, subject to the rules set out in Internal Revenue Code (Code) § 42. Under those rules the amount of the Standard LIHTC is based on a number of factors, including the cost of the project. The Donation LIHTC is generally equal to 50% of the value of the donation, but the EOHLC can increase that amount to 65% if necessary for the viability of a specific project. To qualify for the credit, a project must meet affordability standards set out in Code § 42. Effective January 1, 2023, the Massachusetts LIHTC is subject to an annual statewide cap of $60 million. EOHLC allocates the credit to taxpayers in accordance with federal and state law. The LIHTC can be used to offset the entire Massachusetts tax liability of a personal income taxpayer and all the tax liability of a corporate taxpayer except for the $456 minimum excise. Unused Standard LIHTC can be carried over for five years. However, the Donation LIHTC must be used in the taxable year that the donation is made. If the taxpayer disposes of the property generating the LIHTC, a portion of the credit may be subject to recapture. The Massachusetts LIHTC is transferable.
Origin: M.G.L. c. 63, §31H
Corporate Excise Tax
Credits Against Tax
2.609
Low Income Housing Credit
The Low-Income Housing Tax Credit (LIHTC) is available to corporate excise taxpayers as well that invest in low-income housing projects that meet federal and state eligibility rules. The credit is part of a federal program that authorizes a federal credit for such investments and subsidizes state credits for eligible projects. The Executive Office of Housing and Livable Communities (EOHLC) DHCD), determines eligibility for, and the amount of, the Massachusetts credit pursuant to federal guidelines. The LIHTC has two components. First, the Standard LIHTC is allowed for the construction or development of new low-income housing or the preservation and improvement of existing federal or state subsidized housing. Second, the Donation LIHTC is allowed for the donation of real or personal property to non-profit entities for use in purchasing, constructing, or rehabilitating housing projects otherwise eligible for the LIHTC. The amount of credit that Massachusetts taxpayers may claim is determined by the EOHLC, subject to the rules set out in Internal Revenue Code (Code) § 42. Under those rules the amount of the Standard LIHTC is based on a number of factors, including the cost of the project. The Donation LIHTC is generally equal to 50% of the value of the donation, but the EOHLC can increase that amount to 65% if necessary for the viability of a specific project. To qualify for the credit, a project must meet affordability standards set out in Code § 42. Effective January 1, 2023, the Massachusetts LIHTC is subject to an annual statewide cap of $60 million. EOHLC allocates the credit to taxpayers in accordance with federal and state law. The LIHTC can be used to offset the entire Massachusetts tax liability of a personal income taxpayer and all the tax liability of a corporate taxpayer except for the $456 minimum excise. Unused Standard LIHTC can be carried over for five years. However, the Donation LIHTC must be used in the taxable year that the donation is made. If the taxpayer disposes of the property generating the LIHTC, a portion of the credit may be subject to recapture. The Massachusetts LIHTC is transferable.
M.G.L. <a href="https://malegislature.gov/Laws/GeneralLaws/PartI/TitleIX/Chapter63/Section31h" target="_blank">c. 63, §31H</a>
128.6
152.5
176.3
195.4
214.4
