LIHTC Expansion Legislation Passes, Signed into Law

July 8, 2025 — Key provisions of the Affordable Housing Credit Improvement Act (AHCIA) were signed into law in the recently Republican-passed One Bill Beautiful Bill Act (OBBBA). The AHCIA has enjoyed broad bipartisan support in Congress for years, having been introduced by a Democrat and Republican lawmaker in past Congresses. The provisions:

• Permanently provide a 12% increase in the 9% allocation of LIHTC credits beginning in 2026
• Permanently reduce the private activity bond financing requirement for 4% LIHTC credits from 50% to 25% starting January 1, 2026

Now that the Budget Reconciliation process is over, lawmakers have turned their attention back to the Fiscal Year 2026 (FY26) budget. Remember, Reconciliation does NOT affect HUD FY26 funding. As Congress works on the appropriations bills throughout the summer, NAHRO’s advocacy efforts will be crucial to passing a HUD budget that meets the challenges of the housing affordability crisis.