The bill amends Chapter 44-11 of the General Laws to introduce the "Affordable Housing Tax Credit Act," which establishes a state low-income housing tax credit for business firms investing in low-income rental housing in Rhode Island. This credit is available to firms that qualify for the federal low-income housing tax credit, allowing them to apply the state credit, set at 50% of the federal credit, against their business corporation tax liabilities. The legislation addresses the urgent need for affordable housing by incentivizing investments in this sector, recognizing the shortage of housing units for low-income individuals and families.

Additionally, the bill amends Section 44-18-30 to eliminate sales tax on materials used for renovating affordable rental housing properties. It establishes an exemption from income tax for income derived from the sale of residential property that is deed-restricted as affordable housing. Furthermore, it includes a ten-year freeze on the tax valuation of newly renovated affordable rental properties, ensuring their assessed value remains stable at the pre-renovation valuation. The bill also includes a recapture provision that allows the state to reclaim any tax savings or credits if the deed restriction on the housing unit is removed.

Statutes affected:
7396: 44-18-30