New HTC-GO Bill Introduced in Senate and House

A new version of the Historic Tax Credit Growth and Opportunity Act (HTC-GO) was reintroduced by Rep. Darin LaHood (R-IL) and Rep. Tom Suozzi (D-NY) in the U.S. House and Sen. Bill Cassidy (R-LA) and Sen. Mark Warner (D-VA) in the U.S. Senate. The bill would return to a one-year delivery of the historic tax credit (HTC). Other new provisions would specifically encourage smaller and rural projects with a boost in credit, and a new allowance for transferring credits.

• Returns to a 1-year delivery of Historic Tax Credits for all projects
  • Since 2017, the 20% tax credit has been delivered over 5-years (4% per year), this provision will return delivery of the HTC to 1-year.
• Lowers the Substantial Rehab Test from 100% to 50% of a building’s basis
  • Lowers the substantial rehabilitation threshold, making more projects eligible to use the HTC.
• Eliminates the HTC Basis Adjustment Requirement
  • Eliminates the requirement that the amount of the HTC must be deducted from a building’s basis (the property’s cost for tax purposes), increasing the value of the HTC and making it much easier to pair with the federal Low-Income Housing Tax Credit.
• Modifies Tax Exempt Use Rules
  • Makes the HTC easier to use by nonprofits such as community health centers, local arts centers, affordable housing, homeless services, museums, theaters, and others by eliminating Tax Code restrictions that make it challenging for nonprofits to partner with developers.
• Increases the credit for smaller projects:
  • Projects below $3.75 million will receive a 30% credit.
  • Rural projects below $5 million will receive a 30% credit. (Rural Definition: Cities/towns with populations less than 50,000 and not contiguous and adjacent to cities/towns of 50,000 in population).
• All small projects are eligible for direct transfer, without need of a partnership-style investment.