HUD published in the Federal Register on September 25 its list of the 2020 Difficult Development Areas (DDAs) and Qualified Census Tracts (QCTs), which are used in the Low Income Housing Tax Credit (LIHTC) program. LIHTC properties in DDAs or QCTs can receive a 30% basis boost in qualified costs, increasing tax credits and resulting in greater investment equity in a project.
HUD designates DDAs and QCTs each year. DDAs are areas with high development costs relative to incomes. QCTs are census tracts with a poverty rate of at least 25% or in which 50% of the households have incomes below 60% of AMI.
The new DDAs and QCTs take effect January 1, 2020. For LIHTC applications submitted in 2020 for projects located in DDAs or QCTs that subsequently lose their DDA or QCT designations, the designations for the project remain in effect as long as the tax credits are allocated within 730 days from the date a complete application is filed.
The September 25 Federal Register notice is available at: https://bit.ly/2lvtz1q
The 2020 list of DDAs and QCTs is available at: https://bit.ly/2egI3MY
More information about the Low Income Housing Tax Credit program is available in NLIHC’S 2019 Advocates’ Guide at https://bit.ly/2lEoeET