How To Qualify for a Tax Credit Apartment

The tax credit apartment program supports the construction of housing units for low-income families, but the tenancy requirements are strict.

July 8 2022, Published 3:06 a.m. ET

If you’re seeking affordable housing, consider tax credit apartments. Those who meet the program’s requirements can save on rent while getting a nice home for their family.

Many families prefer to own a house rather than pay rent, but don't have time to save for a mortgage downpayment and have to keep renting. To feed your family, save for the retirement, and tackle student loan debt, you want affordable rent.

Tax credit apartments, explained

In 1986, the government took a step to support the construction of affordable housing units for low-income families. Through the low-income housing tax credit program, the government subsidizes the construction of affordable apartments, single-family homes, duplexes, and townhouses. The program has built more than three million housing units since its inception.

The housing tax credit program doesn’t provide direct funding to projects. Instead, the government offers tax credits to developers to offset the cost of building low-cost rental housing units. The tax credit means developers can lower their income tax liability once they start collecting rent on properties.