what is the low income housing tax credit 
the low income housing tax credit lihtc is a tax incentive for housing developers to construct purchase or renovate rental housing for low income individuals and families the lihtc was written into the tax reform act of 1986 1the lihtc provides state and local agencies with the authority to distribute around 9 billion annually in federal tax credits for every dollar of tax credit received developers can reduce a dollar s worth of their federal income tax owed however the amount of tax credit available to each developer is determined by the number of low income housing units the developer plans to build 2to be eligible for low income rental housing properties applicants must find an eligible tax credit property and typically earn less than 60 of the area median income ami 3