Workforce Housing Tax Credit
Assisting Construction or Rehabilitation of Housing in Communities with Workforce Housing Needs
This program provides tax benefits to developers to provide housing in Iowa communities, focusing especially on those projects using abandoned, empty or dilapidated properties.
A Small Cities set aside for this program is available to eligible projects within the 88-least populous counties in Iowa.
- Total program benefits limited to $1 million per project
- Tax incentives include a refund of sales, service or use taxes paid during construction
- Developers may receive a state investment tax credit of up to 10% of the investment directly related to the construction or rehabilitation of the housing. Developers qualifying under the Small Cities set aside may receive an investment tax credit of up to 20% of the investment directly related to the construction or rehabilitation of the housing. The state investment tax credit is fully transferable.
- Federal, state or local grants, tax credits, forgivable loans or other assistance not requiring repayment cannot be included for the purposes of calculating new investment
- Tax credit is based on the new investment used for the first $150,000 of value for each home or unit
- Tax credit is earned when the home or unit is certified for occupancy and can be carried forward for up to five additional years or until depleted, whichever occurs first
- Projects must meet one of four criteria:
- Housing development located on a grayfield or brownfield site
- Repair or rehabilitation of dilapidated housing stock
- Upper story housing development
- New construction in a greenfield (only communities or a project qualifying under the Small Cities set aside)
- Developer must build or rehabilitate at least four single-family homes or at least one multi-family building containing three or more units or at least two upper story units
- This program has a per unit cost cap to ensure units created under the program are workforce housing
For FY 2024, project costs may not exceed the following per unit cost caps:
single family unit in an urban area $298,021 single family unit in a small city $298,021 multi-family unit in an urban area $241,643 multi-family unit in a small city $241,643
- The housing project must be completed within three years from the date of award
- The housing units must be for owner or renter occupied permanent residence, and not offered for rent on a daily or weekly basis.
How Do I Apply?
- FY 2024 application round for Workforce Housing Tax Credit projects is open and will be due June 9, 2023.
- Applications will be submitted through iowagrants.gov
- FY 2024 Workforce Housing Tax Incentive Application Workshop presentation and recording available in Resources section below.