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Tax Credit Tuesday PodcastsAuthor: Novogradac & Company LLP
Each Tax Credit Tuesday, the Novogradac audio broadcast offers an in-depth weekly look at tax credit topics. A new episode is posted here and on the RSS Feed by 1 p.m. Pacific Time every Tuesday. Genres: News Contact email: Get it Feed URL: Get it iTunes ID: Get it |
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Feb. 3, 2026: 25% Test Implementation: Recycled Bonds, Taxable Tails and Other Ways to Close the Financing Gap
Tuesday, 3 February, 2026
The One Big Beautiful Bill Act (OBBBA), approved July 4, 2025, made various significant changes to the low-income housing tax credit (LIHTC) incentive. Among key changes, the OBBBA lowered the threshold for private activity bond (PAB) financing required to qualify for 4% LIHTCs from 50% of a development's land and building costs to 25%. On this episode of the Tax Credit Tuesday podcast, Michael Novogradac, CPA, and Novogradac partner Dirk Wallace, CPA, explore how this change is affecting financing for affordable housing development. Novogradac and Wallace provide an overview of the 25% test and PABs, including recycled PABs. The pair also discuss how states are implementing the 25% financed-by test, as well as the ways developers are overcoming the financing gap the new test created. Finally, Novogradac and Wallace conclude by discussing how to maximize net operating income (NOI) by approaching operating expenses as efficiently as possible.
