The IRS issued the following Revenue Ruling and Revenue Procedue regarding the Low Income Housing Tax Credit:
Revenue Ruling 2021-20 provides guidance regarding whether the 4 percent applicable percentage (4 percent floor) under § 42(b)(3) of the Internal Revenue Code applies to the low-income buildings described in the revenue ruling. This revenue ruling holds that a draw-down bond that is issued prior to 2021 (with draws occurring in a subsequent year), a de minimis § 42(h)(4)(A) obligation issued after December 31, 2020, or a de minimis allocation of low-income housing credit dollar amount occurring after December 31, 2020, do not cause a building to be subject to the minimum 4 percent floor under § 42(b)(3).
Revenue Procedure 21-43 provides safe harbors for when an obligation described in § 42(h)(4)(A) of the Internal Revenue Code or an allocation of a low-income housing credit dollar amount is more than de minimis for purposes of the associated revenue ruling providing guidance on whether the 4 percent applicable percentage under § 42(b)(3) applies to certain low-income buildings.
Revenue Ruling 2021-20 & Revenue Procedure 21-43 will in in IRB 2021-51, date 12/27/2021.