Yesterday, the Senate published its tax reform plan which preserves both 9% and 4% LIHTC programs. Meanwhile, the House plan was voted out of the Ways and Means Committee with no changes made to the plan’s proposed elimination of 4% PABs. The House will likely vote on the plan next week.
See below for an article from the Novogradac Tax Reform Resource Center.
Senate Tax Reform Bill Retains LIHTC, Preserves Private Activity Bonds and NMTC, Reduces but Maintains HTC
The Senate Finance Committee yesterday introduced its version of tax reform legislation. The Senate bill would retain 4 percent and 9 percent low-income housing tax credits (LIHTCs) and tax-exempt multifamily private activity bonds. The bill also preserves the 2018-2019 authorized new markets tax credit (NMTC) allocation rounds. The Senate bill repeals the 10 percent non-rehabilitation historic tax credit (HTC) and reduces the 20 percent HTC to 10 percent. “Orphaned” renewable energy tax credit technologies would be extended at the investment tax credit phasedown schedule. The Senate tax reform bill would reduce residential rental and nonresidential real estate depreciation to 25 years. It would also delay until 2019 cutting the top corporate tax rate to 20 percent, a break from the House proposal of implementing the lower rate immediately. The Senate bill would also fully repeal the state and local tax deduction and would keep the mortgage interest deduction largely intact for mortgages up to $1 million. It would repeal the alternative minimum tax. The Senate Finance Committee plans to mark up the bill next week.
Meanwhile, the House Ways and Means Committee yesterday advanced to the full House its version of the Tax Cuts and Jobs Act (H.R. 1), which the Joint Committee on Taxation estimates will cost $1.437 trillion in lost federal revenue over 10 years.