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  Rental Production > Low Income Housing Tax Credit (LIHTC) Program 

 

This program provides a federal tax credit to investors in affordable housing. The credit can be used each year for 10 years and is allocated to the owner of a development. Investors take an ownership interest in order to utilize the tax credits, thereby generating equity to construct or acquire and rehabilitate the development.  Annually, the Internal Revenue Service allocates the credit to each state in an amount equal to $2.30 times its population. Missouri also has a state low income housing credit, and may allocate an amount equal to 100% of the federal credit.  The housing credit is limited to a percentage of the Qualified Basis, based upon depreciable basis, and the percentage of affordable units in the development.  The minimum number of qualifying units is 40 percent of the total number of units affordable to persons at 60 percent of the median income, or 20 percent affordable to persons at 50 percent of the median income.
 

The Qualified Allocation Plan (QAP) sets forth the selection criteria, federal preferences and MHDC priorities for proposal selection. This plan is revised annually.  A copy of the QAP is available on the MHDC website. Link to Rental Production Page.


Congress has delegated the administration of the Low Income Housing Tax Credit to state housing agencies to ensure that good quality housing would be available where it is most needed. MHDC is charged not only with the allocation of credit, but also with the assuring compliance with the regulations.  This includes the performance of a physical inspection of the property; a review of management and occupancy procedures during the compliance period of the initial 15 years and the extended use period (an additional 15 years). A copy of the Tax Credit Compliance Manual is available on the MHDC website.  
 

Type of Assistance
 

Federal and state housing tax credit, which may be sold to investors to generate equity for the proposed development.
 

Eligibility Requirements

Developers (for-profit and not-for-profit) are eligible to apply for tax credits. Applicants must demonstrate prior, successful housing experience and engage the services of housing professionals, such as architects, appraisers, attorneys, accountants, contractors and property managers with demonstrable tax credit and housing experience. Developers must have the financial capacity to successfully complete and operate the proposed housing development.
 

Proposed housing developments must include the following:
 

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Meet a demonstrated affordable housing need

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Provide housing for low income persons and families

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Demonstrate local support

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Leverage tax credit funding with other financing and/or rental assistance

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Be economically feasible

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Balance sources and uses of funds

 

Fund Availability

 

Determined by Federal law as applied to population of the State of Missouri.

Application Process


The Commission sets the schedule annually.  A Notice of Funding Availability (NOFA) is published.  

 

For additional information contact Emily Blakey, 816.759.6654.

 

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