Congress Dangles Tax Credits to Boost Supply of Affordable Housing

 

The 2017 federal tax overhaul sharply reduced banks’ tax rates, but it also provided less incentive for banks to invest in affordable housing.

As banks’ tax bills have declined, the tax credits used by developers to build more affordable housing have simply become less attractive to banks.

Yet the supply of affordable rental properties continues to shrink, so now some lawmakers are proposing legislation that aims to renew banks’ interest in the tax credits and bring more affordable homes to markets that badly need them.