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S 9571

Permits multiple transfers of low-income housing tax credits

2025 Regular Session Introduced by Brian Kavanagh

Allows multiple transfers of NY LIHTCs among taxpayers and transferees while preserving project eligibility and program benefits.

REFERRED TO WAYS AND MEANS
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Bill Summary · S 9571

Overview

bill: S 9571 (2025-2026) New York
jurisdiction: New York
title: Permits multiple transfers of low-income housing tax credits

Introduced by: Sen. Kavanagh (co-sponsor: Brian Kavanagh)

Status history: Passed Senate (May 12, 2026); referred to Assembly Ways and Means. Prior actions include committee referrals and readings.

Purpose: The bill amends the Public Housing Law to allow multiple transfers of low-income housing tax credits (LIHTC) among taxpayers and transferees, while preserving the underlying project’s eligibility for program benefits. The goal is to provide greater flexibility in monetizing and reassigning LIHTCs across entities while maintaining compliance with program rules.

Key provisions

  • LIHTC credit allocation

    • Taxpayers subject to New York tax law who own an interest in eligible low-income buildings (or transferees of such taxpayers) are eligible to receive a credit against their tax equal to the amount of LIHTC allocated by the Commissioner to each building.
    • The credit is generally claimed over ten taxable years within the credit period.

  • Transferability of credits

    • A taxpayer who receives LIHTC can transfer the credit, in whole or in part, to another person or entity (the transferee) without regard to whether the transferee has any federal LIHTC associated with the project.
    • Transferees can apply the transferred credit against tax under article 9-A, 22, or 33 of the tax law, provided all credit-claim requirements are met.
    • A transferee may transfer all or part of a credit to another person or entity, subject to:
    • agency approval
    • compliance with agency-promulgated rules
    • proper documentation of each transfer
    • Transfers must not affect the eligibility of the underlying low-income project for program benefits.

  • Interaction with underlying projects

    • The ability to transfer credits does not change or jeopardize the project’s eligibility for LIHTC program benefits.

  • Effective date and applicability

    • The act takes effect immediately.
    • Applies to any LIHTC allocated under New York’s Public Housing Law, whether allocated before, on, or after the effective date.
    • Credits associated with projects that are placed in service, under construction, or in pre-development are covered.
    • Any transfer occurring on or after the effective date must comply with the amended transfer provisions.

Who is affected

  • Taxpayers who own interests in eligible low-income housing developments and are eligible for LIHTCs under New York law.
  • Transferees of LIHTCs, including entities that may acquire credits through multiple transfers.
  • The New York State LIHTC program administration (agency) responsible for approving transfers and enforcing rules.
  • Low-income housing projects receiving LIHTCs, as transferability is designed not to affect their eligibility for program benefits.

Procedural and timeline aspects

  • Enactment mechanics: Immediate effective date upon enactment; applies to all LIHTCs allocated under article 2-A of the Public Housing Law.
  • Transfers require agency approval and must follow agency rules, with proper documentation for each transfer.
  • Projects under various stages (placed in service, under construction, pre-development) are covered, ensuring broad applicability.

Potential impact

  • Increased flexibility: The bill broadens the secondary market for LIHTCs by allowing multiple transfers, potentially unlocking capital and providing more financing options for developers and investors.
  • Economic implications: By enabling more fluid transferability, the bill could influence the liquidity and value realization of LIHTCs, potentially affecting financing terms for eligible projects.
  • Risk management: Transfer approvals and documentation requirements aim to maintain oversight and protect program integrity and project eligibility.

If you’d like, I can provide a one-page plain-English briefing or a comparison to current law to illustrate the concrete changes.

Compiled from official sources — confirm details with the bill’s official record.

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