IRS Publishes Population Figures for Calculating Disaster Housing Credit Authority

This morning the Internal Revenue Service (IRS) published Notice 2021-45 advising Housing Credit allocating agencies that qualified for additional Housing Credit authority under the Taxpayer Certainty and Disaster Tax Relief Act of 2020 of the population residing in qualified disaster zones, which is necessary for determining the amount of disaster Housing Credit authority for which each qualified state is eligible.

The legislation provides additional Housing Credit authority to states that suffered presidentially declared major disasters and encompass a county or counties designated by the Federal Emergency Management Agency to receive individual or individual and public assistance (qualified disaster zones). Eleven states (Alabama, California, Florida, Iowa, Louisiana, Michigan, Mississippi, Oregon, South Carolina, Tennessee, and Utah) and Puerto Rico qualified. The additional credit authority is equal to $3.50 multiplied by the population residing in qualified disaster zones and is capped at 65 percent of the state’s 2020 credit ceiling. Agencies may allocate the additional disaster credits in 2021 or 2022, or a portion in each of the two years.

The legislation extends by 12 months each the Housing Credit 10 percent test deadline and the placed in service deadline for projects located in qualified disaster zones and provides that such allocations and extensions must be designated by the Housing Credit allocating agency. NCSHA has requested additional guidance from IRS on this designation procedure.