On Saturday, the New York State Senate and Assembly approved a budget proposed by Governor Kathy Hochul that includes a replacement for the 421a affordable housing tax credit that expired in 2022. According to The Real Deal, the new tax credit, known as 485x, will not include the option created by 421a for developers to satisfy affordability requirements with a 30% set-aside for households earning 130% AMI. However, 485x will include a longer exemption from taxes (40 years instead of 35). The tax credit will expire June 15, 2034 but income-restricted units must remain permanently affordable.
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