The Spring Street Brief

Episode 20: LIHTC Expansion Under the One Big Beautiful Bill Act

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The One Big Beautiful Bill Act (OBBBA) delivers the most significant Low-Income Housing Tax Credit expansion in years, with major benefits for affordable housing developers and investors starting in 2026.

Key LIHTC Changes in the OBBBA:

  • Permanent 12% increase in 9% LIHTC allocations beginning 2026
  • Bond financing threshold lowered from 50% to 25% for 4% LIHTC rehabilitation projects
  • Estimated 80,000 additional affordable units from 9% credit expansion through 2035
  • Over 1 million additional affordable rental homes projected from bond threshold change

    • State-by-State Impact:

    • California: 200,000 new units projected through 2035
    • Georgia: 98,000 new units
    • Texas: 97,000 new units

      • For LIHTC developers, syndicators, and tax credit investors, the math on 4% acquisition-rehab deals just got significantly better. Properties placed in service after December 31, 2025 qualify under the new rules.

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      The Spring Street BriefBy Spring Street Management Group