This bill amends the Income Tax Act of 1967 by adding new sections that establish a housing opportunity tax credit for qualified taxpayers starting from tax years beginning on or after January 1, 2027. A qualified taxpayer, defined as an owner of a qualified project awarded a housing opportunity tax credit, can claim this credit based on an allocation statement issued under the state housing development authority act. The credit amount is the lesser of the amount stated in the allocation statement or the taxpayer's allocated share. If the allocation statement is not available by the time the taxpayer files their return, they may use a reservation letter instead. Additionally, if a federal low-income housing tax credit is recaptured or disallowed, the taxpayer must also recapture a corresponding portion of the housing opportunity tax credit.

The bill also outlines provisions for flow-through entities, stating that if such an entity allocates a housing opportunity tax credit to its members, it cannot claim the credit itself for that allocated share. Any unused portion of the housing opportunity tax credit can be carried forward for up to ten years. The bill includes definitions for key terms such as "allocation statement," "qualified project," and "qualified taxpayer," ensuring clarity in its application. The enactment of this bill is contingent upon the passage of two other related bills in the legislature.

Statutes affected:
Substitute (H-1): 206.1, 206.847
House Introduced Bill: 206.1, 206.847