APARTMENT ADVOCATE
NATIONAL APARTMENT ASSOCIATION /
NATIONAL MULTIFAMILY HOUSING COUNCIL
Implementation of LIHTC
Income Averaging Raising Key Questions
S
tates are beginning the process
of implementing a new “income
averaging” option that allows
the Low-Income Housing Tax
Credit (LIHTC) to serve households
earning up to 80% of area median income
(AMI). This NAA/NMHC supported
provision, which was enacted last March as
part of the Consolidated Appropriations
Act of 2018, makes the LIHTC program
more flexible and allows for more mixed-
income housing.
is available to new developments making
their election after March 23, 2018.
Income averaging provides an additional
Developers make their election on Form
way for developments to qualify for the
8609, which the IRS revised in late May
LIHTC. Previously, LIHTC program rules
to account for the new election.
required owners to either rent 40% of their
units to households earning no more than
HOW ARE STATES IMPLEMENTING
60% of AMI, or 20% to those earning no
INCOME AVERAGING?
more than 50% of AMI. Now, owners have
The implementation of income
the option of reserving 40% (25% for New
averaging
is raising many questions in the
York City) of the units in a property for
LIHTC
community.
people whose average income collectively
is below 60% of AMI. Income averaging
WHAT IS INCOME AVERAGING?
Legacy Partners has a 47-year
track record of consistently out
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• Asset Management
We’re not just multi-family,
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650 S. Cherry Street # 825
Denver, CO 80246
303-320-3500 • legacypartners.com
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AUGUST 2018
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