The Virginia General Assembly has passed measures that expand the eligibility for landlords in the Washington-Arlington-Alexandria Metropolitan area to receive an income tax credit for renting their units to participants in the Housing Choice Voucher program. Current law applies to landlords in the Richmond, Virginia Beach, Norfolk and Newport News Metropolitan areas. The new legislation – HB-590 – will go into effect on July 1, 2020. The tax credit will be administered by the Virginia Department of Housing and Community Development (DHCD).
What is a Qualifying Housing Unit? Qualified housing units are apartments or other rental property where a Housing Choice Voucher Housing Assistance Payment contract has been set up with the local public housing authority.
What is the value of the tax credit? The income tax credit is equal to 10 percent of the fair annual market rent for the specific qualifying housing unit. If a unit is qualified for less than a full year, the credit amount will be prorated. The credit cannot be greater than a qualified landlord’s tax liability.
Are there limitations? Yes. DHCD cannot issue more than $250,000 in livable home tax credits per fiscal year. If the total amount of eligible applications received by March 1 exceeds $250,000 in a fiscal year, DHCD will prorate the amount of credits among eligible applicants. If the total amount has not been issued based upon applications received by March 1, the remaining balance will be issued on a first come, first served basis.
Visit DHCD’s website for additional details and for information regarding the application process.