What is the Alabama Workforce Housing Tax Credit?
The Alabama Workforce Housing Tax Credit (Act 2024-302) is a state tax credit for the construction or rehabilitation of qualifying multifamily workforce housing in Alabama. It applies to tax years beginning on or after January 1, 2025.
The program is administered by the Alabama Housing Finance Authority (AHFA). Projects must first qualify as federal low-income housing projects and obtain an eligibility certificate from AHFA; that certificate will state the annual credit amount and the award period, which can be up to 10 years. For questions about eligibility, contact AHFA at ahfa.au.audit@ahfa.com or (334) 244-9200.
A qualifying project can receive a credit of up to $2 million per project. The credit may be applied against Alabama income tax, the state portion of the financial institution excise tax, or the insurance premium tax.
The credit is claimed each year during the award period. It is non-refundable and non-transferable, but any unused credit may be carried forward for up to five years. Pass-through entities may allocate the credit to partners, members, or shareholders; recipients who receive the credit through a pass-through must allocate it to the correct tax type in My Alabama Taxes before filing.
The Alabama Department of Revenue will send project owners or pass-through entities a letter with instructions on how to claim or allocate the credit.
The program is administered by the Alabama Housing Finance Authority (AHFA). Projects must first qualify as federal low-income housing projects and obtain an eligibility certificate from AHFA; that certificate will state the annual credit amount and the award period, which can be up to 10 years. For questions about eligibility, contact AHFA at ahfa.au.audit@ahfa.com or (334) 244-9200.
A qualifying project can receive a credit of up to $2 million per project. The credit may be applied against Alabama income tax, the state portion of the financial institution excise tax, or the insurance premium tax.
The credit is claimed each year during the award period. It is non-refundable and non-transferable, but any unused credit may be carried forward for up to five years. Pass-through entities may allocate the credit to partners, members, or shareholders; recipients who receive the credit through a pass-through must allocate it to the correct tax type in My Alabama Taxes before filing.
The Alabama Department of Revenue will send project owners or pass-through entities a letter with instructions on how to claim or allocate the credit.
