IRS Releases Amount of Unused Housing Credit Allocation, Inflation Adjustments

The IRS recently released Revenue Procedure 2015-53, which outlines the inflation adjustments for nearly 50 federal tax provisions, including the amount of Low Income Housing Tax Credit (Housing Credit) authority each state will receive. Under the new guidelines, each state will be allocated $2.35 in Housing Credit authority multiplied by its population, or $2.69 million, whichever is greater. This is a slight increase from 2015, when states received $2.30 for every resident, and the minimum was $2.635 million.

The IRS also recently published the amounts of unused LIHTC allocation that were reallocated for calendar year 2015 in Revenue Procedure 2015-49. The national pool exists because a handful of states don’t use all of their per capita housing credits and these unused credits are placed into the national pools, which are then reallocated to qualified states that request them. For 2015, only about $2.6 million of unused housing tax credits were divided among 31 qualified states and Puerto Rico.

According to Revenue Procedure 2015-49, the five states with the largest unused housing credit carryover amount allocated from the national pool for 2015 are California, Texas, Florida, New York, and Illinois.