Veterans Housing Is Eligible for Tax-Exempt Bond Financing

Two weeks after senators sent a letter asking IRS Commissioner Charles Rettig to issue a notice clarifying that affordable housing projects for veterans that comply with the LIHTC General Public Use criteria are also eligible for Private Activity Bonds (PABs), the IRS released Revenue Procedure 2019-17.

In 2008, Congress created a provision that allowed LIHTC-financed properties to provide occupancy preferences for specific groups, such as veterans. However, at the time, Congress did not explicitly say that such occupancy preferences were allowable for private activity bond-financed developments. Revenue Procedure 2019-17 confirms that you can combine tax-exempt residential rental housing bonds with the LIHTC and give preferences to specific groups, such as veterans.