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Other options incorporate raising the cap on states’ tax-exempt private activity bonds (PABs) employed for housing and minimizing the 50% test for LIHTCs. Below recent regulation, if a developer finances 50% or more of a project with tax-exempt PABs, the owner is mostly qualified to say tax credits that don’t affect an company’s LIHTC volume cap.
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LIHTCs are allocated to each state because of the federal govt determined by population. States are allowed to have more than unused LIHTC funding for 3 years. Historically, most states received more funding than they desired.
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