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REBlog-Tax-Cuts-and-Jobs-Act.jpgThe Tax Cuts & Jobs Act (the Act) was signed into law at the end of 2017 and certainly has an impact on the affordable housing industry.


While tax reform left LIHTC intact; the decline in the corporate tax rate from 35% to 21% is expected to have negative consequences for new rent-restricted supply.


Tax credits are now less valuable and prices have declined since discussions on implementing a corporate tax cut began in 2017. Developers may struggle with new projects to fill the financing gap resulting from lower proceeds from investment in LIHTC due to this decline.


The Act allows investors to defer paying tax, up to nine years, on gains if those gains are invested in Qualified Opportunity Funds that in turn invest in economically distressed communities (known as opportunity zones) designated by the governor of each state.

 

 

 

 

February 6, 2019

REBlog-Tax-Cuts-and-Jobs-Act.jpgThe Tax Cuts & Jobs Act (the Act) was signed into law at the end of 2017 and certainly has an impact on the affordable housing industry.

While tax reform left LIHTC intact; the decline in the corporate tax rate from 35% to 21% is expected to have negative consequences for new rent-restricted supply.

Tax credits are now less valuable and prices have declined since discussions on implementing a corporate tax cut began in 2017. Developers may struggle with new projects to fill the financing gap resulting from lower proceeds from investment in LIHTC due to this decline.

The Act allows investors to defer paying tax, up to nine years, on gains if those gains are invested in Qualified Opportunity Funds that in turn invest in economically distressed communities (known as opportunity zones) designated by the governor of each state.

 
 
Readers should not act upon information presented without individual professional consultation.

Any federal tax advice contained in this communication (including any attachments): (i) is intended for your use only; (ii) is based on the accuracy and completeness of the facts you have provided us; and (iii) may not be relied upon to avoid penalties.

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