This bill establishes two key programs aimed at enhancing housing opportunities in Iowa: the Iowa housing tax credit program and the neighborhood renovation grant program. The housing tax credit program allows taxpayers to claim credits against state taxes for investments in qualified low-income housing projects, with a cap of $15 million annually, including any unallocated or recaptured credits from previous years. The Iowa finance authority will oversee the application and authorization process for these credits, which includes specific eligibility criteria and provisions for recapturing credits if the development's qualified basis decreases.

Additionally, the bill allocates $50 million for a neighborhood housing renovation grant fund, providing grants of up to $20,000 to homeowners for qualifying exterior improvements, contingent on a household income not exceeding $109,000. The bill also increases the annual deduction limits for contributions to first-time homebuyer savings accounts to $10,000 for married couples filing jointly and $5,000 for other account holders, with these limits indexed to inflation. The provisions of the bill will take effect on January 1, 2026, applying to tax years beginning thereafter.

Statutes affected:
Introduced: 16.37C, 422.60, 533.329