Low Income Housing Tax Credits

Low-Income Housing Tax Credit Information

The Low Income Housing Tax Credit Program (LIHTC) is a program of the Internal Revenue Service (IRS) providing tax credits that may be sold to private investors to generate direct equity. The proceeds from the sales of the tax credits then finance a portion of the affordable housing development costs. In Arizona, the program is administered by the Arizona Department of Housing. Many LIHTC properties also offer units to Section 8 Housing Choice Voucher program participants.

Accessing Tax Credits

Tax credits may be accessed in one of the two following ways:

  1. The State of Arizona holds an annual competition to distribute its annual allocation of 9% tax credits. This application round is generally held in the spring with award reservations made in the summer.
  2. 4% tax credits are available on a noncompetitive basis to qualified projects that have received a private activity bond allocation from the state. A separate tax credit application is required at the time of the submission of a bond application and whether or not tax credits may be provided to the project is determined through an underwriting review.

Current Commercial Affordable Rental Properties

The LIHTC program results in the creation of affordable rental properties. The following apartment complexes offer affordable rental units (up to 60% AMI) in Flagstaff:

Some LIHTC properties are specifically directed to seniors who earn no up to 60% AMI:

  • Flagstaff Senior Meadows | 1351 N Pine Cliff Drive | (928) 527-6998
  • Sandstone Highlands Senior Community | 300 W High Country Trail | (928) 773-4420

Flagstaff Incentive Policy for Affordable Housing

You can review the Flagstaff Incentive Policy for Affordable Housing (PDF). This incentive policy was revised in 2017. Flagstaff hosts three participating rental facilities with more soon: