Low income housing tax credits can reduce the cost of development for properties that allocate a certain amount of funds to residents with incomes below area medians. To be eligible for LIHTCs, 20 percent of units must be occupied by households with incomes at or below 50 percent of area median income or 40 percent of units must be occupied by households with income at or below 60 percent of median income. The Department of Housing and Urban Development determines median income based on household size. Units must be rent restricted.
LIHTCs can reduce tax liability dollar-for-dollar. Lotzar Law Firm, P.C. can help you to apply for tax credits. Call today to schedule a consultation and learn more about how we can represent you throughout the process for obtaining a low income housing tax credit award.
What is the Process for Obtaining a Low Income Housing Tax Credit Award
Arizona established the process for obtaining a low income housing tax credit award within the state. The Arizona Department of Housing oversees the process and has authority to allocate credits to any developers or projects that meet minimum federal guidelines.
The process for obtaining a low income housing tax credit award begins by submitting a hard copy and a CD of the complicated application. The application must contain exhibits and forms including but not limited to:
- Site amenities supporting documentation
- A legal opinion and an opinion from a CPA
- A project cost form
- A market demand study guide
- A supportive services plan
- A scheduled for the project
- A self-score sheet
- Certification of qualified non-profit participation
- Forms detailing development experience and development team experience
- A schedule of real estate that is owned
- Planning and zoning verification
- A certificate from an architect
- A sustainable development checklist
Lotzar Law Firm, P.C. will assist in completing and assembling all required forms and exhibits that must be submitted as part of the process for obtaining a low income housing tax credit award. Applications must meet specific requirements including providing materials in a binder, indexed and tabbed and in 8-1/2 x 11 format. A non-refundable application fee of $5,000 must be submitted with the application. If gap financing is required, a gap financing fee must also be paid with a completed application for LIHTCs.
The developer, co-developer or consultant must include certification that an LIHTC Application workshop had been attended over the course of the year. Proof that the Developer, Co-Developer or Consultant attended Compliance Training within the past five years is also necessary as part of a successful application.
The Arizona Department of Housing uses a competitive review process to award low income housing tax credits. Regardless of scope, applications for housing development projects are denied if they do not meet LIHTC guidelines.
Lotzar Law Firm, P.C. will assist in ensuring that you meet all guidelines and that you submit a comprehensive application for consideration. Call today to schedule a consultation and learn more about how our Scottsdale, AZ real estate development lawyers can help you.
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