APARTMENT ADVOCATE
NATIONAL APARTMENT ASSOCIATION
What the Passing of the Inflation Reduction Act Means for Rental Housing Providers
The $ 740 Billion Act Includes Provisions That May Affect The Rental Housing Industry .
KEY TAKEAWAYS
The absence of a carried interest provision in the Inflation Reduction Act is a significant victory for the rental housing industry .
The bill includes several relevant provisions for rental housing providers , including energy efficiency tax incentives , grants to hasten state adoption of stricter billing codes and more .
On Aug . 16 , President Biden signed the Inflation Reduction Act ( IRA ) of 2022 , ending months of negotiations on a bill totaling over $ 700 billion . In a significant win for the rental housing industry , the final bill did not change the taxation of carried interest . The carried interest provision originally proposed within the bill would have negatively impacted the multifamily industry by requiring that an asset be held for 3 years before it could qualify for carried interest treatment .
Related , the IRA includes a 15 % minimum tax on corporations and a 1 % excise tax on stock buybacks , both of which will take effect beginning January 2023 . The bill also , unfortunately , extends current law limits on excess business losses by two years .
Additionally , the IRA includes several climate change and energy provisions that affect housing providers . These include energy efficiency tax incentives , grants to hasten state adoption of stricter building codes , support for “ transportation equity ” investments and targeted sustainability incentives for affordable housing providers and rebates for certain energy efficiency retrofits .
See next page for more details on the IRA and how it could affect the industry . www . aamdhq . org SEPTEMBER 2022 TRENDS | 45