The Affordable Housing Equity Act of 2025 increases tax credits for developers who build affordable housing specifically for extremely low-income households. The bill boosts the low-income housing tax credit by 50 percent (to 150 percent of normal value) for residential buildings where at least 20 percent of units are reserved for households earning no more than 30 percent of their area's median income or the federal poverty line, whichever is higher. This affects housing developers and investors who claim these tax credits, making it more financially attractive to build deeply affordable units for the poorest households. The tax credit increase applies to buildings that receive funding allocations after the bill's enactment, or for certain bond-financed projects with issue dates after December 31, 2025. The bill aims to address the shortage of affordable housing for extremely low-income families by making development projects more economically viable.
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