White House Reiterates Support for the Neighborhood Homes Tax Credit

On June 1, the White House reiterated its support for the Neighborhood Homes Tax Credit with the release of a fact sheet outlining its broader efforts to reduce the racial wealth gap through the American Jobs Plan. This follows the May 28 inclusion of the tax incentive in the President’s Budget and corresponding Green Book from the Treasury, which details the President’s tax priorities and plan to pay for the budget proposal. The tax credit, which aims to help revitalize historically marginalized communities, would help attract additional private investment in the rehabilitation of older homes and increase homeownership rates in low- and moderate-income communities. The proposal is modeled after the successful Low-Income Housing Tax Credit (Housing Credit) and New Markets Tax Credit (NMTC), and would subsidize single-family housing development costs in census tracts where poverty rates are at least 130 percent of the area poverty rate, median family income is below 80 percent of the area median income, and median home values are lower than the area/state median value. Qualified homeowners are those whose household incomes do not exceed 140 percent of the area median income, adjusting for household size as determined by the HUD Secretary. The administration’s support for the tax incentive mirrors the Neighborhood Homes Investment Act (NHIA), which was reintroduced in both the Senate (S. 98) and the House (H.R. 2143) this Congress by Senators Ben Cardin (D-MD) and Rob Portman (R-OH) and Representative Brian Higgins (D-NY) respectively.

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