Tax law changes affecting tax credits to invest in affordable housing
This article in the Inquirer explains how the new tax law will negatively impact investment in affordable housing projects throughout the country. Tax credits allowed those in high tax brackets to reduce their tax obligations if they invested in low income housing developments. But with corporate tax rates being reduced, the incentive for affordable housing investment going forward is diminished because of changes in depreciation and the interest deduction. Developers will need to fill in financing gaps with other sources or reduce the number of affordable units being constructed.