What does AHTC mean in TAX

An Affordable Housing Tax Credit is a federal or state incentive that provides a specific amount of money in exchange for investments made in affordable housing projects. The funds help to subsidize low-income households by providing them with improved living conditions.

AHTCs provide investors, such as corporations, banks, or private equity firms, with tax credits spread over a 10-year period in return for construction and/or rehabilitation investments into affordable housing units. The amount of the credit depends on the type of unit being built or rehabilitated, as well as its location.

In order to qualify for an AHTC, a project must meet certain requirements like rent restrictions, income limits, and tenant qualifications based on area median income guidelines set out by HUD. Additionally, any organization receiving the credit must commit to providing affordable housing for at least 15 years

Every state has its own application process for obtaining an AHTC. In general these applications are time sensitive so it is important to be aware of current deadlines and regulations prior to submitting your application. You can find information on how to apply through your state's agency responsible for administering tax credits.

Qualifying projects can range from new construction projects such as apartment buildings and single family homes, conversions from existing structures into rental properties or expanding existing properties into additional units suitable for tenants meeting their state's median income thresholds.