The Low Income Housing Tax Credit Program was designed as an incentive for construction and rehabilitation of housing for low-income households.
Created by the Internal Revenue Code of 1986, the Housing Tax Credit Program offers a reduction in tax liability to owners, subject to restrictions. The annual housing tax credit amount is intended to provide the owner or investor a return which provides a "present value" of either 30% or 70% of the qualified costs of the low-income units in the development. Depending on the project type, the qualified project costs (depreciable costs) will be eligible for either 30% present value (correlating to 4%) or 70% present value (correlating to 9%). The maximum allowable credit amount is determined by multiplying the annual percentage rate (approximately 4% to 9%) by the qualified costs attributed to the designated low-income units in the project.
Developers of housing tax credit projects typically raise equity capital for their projects by syndicating the tax credits to investors who are willing to invest in the project. The investors' return is the annual tax credit and other economic benefits generated by the project. The U.S. Department of Treasury annually allocates in excess of $2.5 million to South Dakota. SDHDA, as the credit-issuing agency, is responsible for the administration of the tax credits.
2016 Housing Tax Credit Applicants
Applications are due annually on the last working day of August at 5:00 p.m. Central Time. Completed applications must be delivered (via U.S. Postal Service, private mailing service, or hand delivery) to SDHDA by 5:00 p.m. Central Time on the applicable due date. Applications via facsimile or e-mail will NOT be accepted. SDHDA estimates that it will have approximately $2,770,000 available for program funding as follows:
|Total Available Tax Credits||$2,770,000|
|Passive Multifamily Set-Aside||$500,000|
|Tax Credit Award Limits|
HTC Qualified Allocation Plan
- pdf HOME-HTC Application* (2.00 MB) *Applicants are no longer allowed to submit utility allowance calculations from their local Public Housing Authority. Applicants may document utility calculations from service providers, use the HUD Utility Schedule Model, or they may utilize the SDHDA Utility Allowance Worksheet to request the utility calculation from SDHDA. Please allow ten working days for the calculation of utilities from SDHDA. For more information regarding the worksheet or utility calculation, please contact Slade Weller at email@example.com or by calling 605-773-3181
- pdf Utility Allowance Worksheet (204 KB)
- spreadsheet HOME-HTC Pro Forma (130 KB)
- pdf Housing Opportunity Fund Supplemental Application (70 KB)
- pdf HOME Program Allocation Plan (1017 KB)
- HTC-Carryover and Final Cost Certification Forms
- pdf 2016 HTC Reservation List (20 KB)
- pdf HTC Cumulative Reservation List (595 KB)
*You will need Adobe Acrobat to fill out the Application form. In order to save the Application form, you will need to have Adobe Acrobat Professional 7.0
Call or e-mail Scott Rounds, Housing Development Officer, with your Housing Tax Credit questions.
Phone: (605) 773-4532