Veterans Housing Preference Relief
The Internal Revenue Service (IRS) has issued Revenue Procedure 2019-17, providing guidance regarding the general public use requirements for qualified residential rental projects financed with tax-exempt bonds under § 142(d) of the Internal Revenue Code. The guidance clarifies that projects with units that are reserved for or for which preferences are provided to members of specified groups (such as veterans) could qualify for tax-exempt bond financing. NABL and other industry groups have been requesting this clarification either through action by the IRS or through legislation from Capitol Hill. Specifically, a working group comprised of members of NABL’s Tax Law Committee drafted a letter we sent to the IRS on December 20, 2018.
On Capitol Hill, this advocacy resulted in a bipartisan group of six U.S. Senators sending a letter to the IRS requesting clarification that the public use requirement for tax-exempt private activity bonds that finance multifamily housing can be applied to preferences for military veterans. NABL thanks The Department of the Treasury and the IRS for their work on this very important clarification, which will permit veterans’ housing projects across the United States to use municipal bonds for their financing. NABL members can login and read the full NABLNet Alert here.