The state of Louisiana offers a range of incentives to businesses and those looking to relocate to the area. From quality jobs and business ownership to industrial tax exemptions, there are plenty of benefits to be had. One such incentive is the Low-Income Housing Tax Credit (LIHTC), which can subsidize up to 70% of the costs of a low-income unit rental project. The 30% subsidy, also known as the “4% automatic tax credit”, is intended for new construction that includes additional subsidies or can be used to cover the cost of purchasing existing buildings.
The 70% subsidy, or “9% tax credit”, is for new construction that does not include any additional federal subsidies. LIHTC properties tend to have lower debt service payments and lower unemployment rates than traditional market-price rental housing. They can also obtain a faster lease and a higher return for investors due to the credit. To qualify for tax credits, the proposed development must involve new construction or substantial rehabilitation of existing units occupied by low-income individuals and families.
Potential applicants apply for housing tax credits by submitting an application to the Louisiana Housing Corporation (LHC). Applications are received and evaluated in accordance with the Qualified Assignment Plan (QAP) at least once a year. The state also offers a tax credit of up to 30 percent for existing companies with operating facilities in Louisiana to establish or continue research and development in the state. The Louisiana Department of Economic Development requires businesses to submit advance notice, along with the appropriate fee, before the contracting, purchase, or construction of a project begins.
In addition, the owner must establish an extended period of use of an additional 15 years by submitting a regulatory agreement on the project to the court clerk of the parish where the property is located. For those looking to take advantage of these incentives in Monroe, Louisiana, it's important to understand all of the available options and how they can benefit your business or project. With careful planning and research, you can unlock these benefits and make your project more successful.
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