This bill significantly expands the federal low-income housing tax credit, a program that encourages private investment in affordable housing for people with lower incomes. The legislation increases the amount of tax credits available to states from $1.75 per dollar to $9.79 per dollar, with the annual per-state cap rising from $2 million to $11.34 million, and establishes automatic inflation adjustments starting in 2026. The bill also offers additional tax credit bonuses of 25 to 50 percent for housing projects that meet specific criteria, such as paying workers prevailing wages, using renewable energy, locating near public transportation, serving people with disabilities, or housing extremely low-income families earning no more than 30 percent of area median income. Additionally, the law requires that at least one-third of each state's housing credits go toward projects meeting these special criteria, and it extends the minimum period that housing must remain affordable from 15 years to 35 years. These changes take effect for buildings placed in service after the bill's enactment, with some provisions applying to calendar years beginning in 2025 or 2026.
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