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20 ILCS 3805/7.28
(20 ILCS 3805/7.28)
Tax credit for donation to sponsors.
The Authority may administer and adopt rules
an affordable housing tax donation credit program to provide tax credits for
donations as set forth in this
(a) In this Section:
"Administrative housing agency" means either the Authority or an agency of the City of Chicago.
"Affordable housing project" means either:
(1) a rental project in which at least 25% of the
units have rents (including tenant-paid heat) that do not exceed, on a monthly basis, maximum gross rent figures, as published by the Authority, that are:
(i) based on data published annually by the U.S.
Department of Housing and Urban Development;
(ii) based on the annual income of households
earning 60% of the area median income;
(iii) computed using a 30% of gross monthly
(iv) adjusted for unit size and at least 25% of
the units are occupied by persons and families whose incomes do not exceed 60% of the median family income for the geographic area in which the residential unit is located; or
(2) a unit for sale to homebuyers whose gross
household income is at or below (A) 60% of the area median income (for taxable years beginning prior to January 1, 2022) or (B) 120% of the area median income (for taxable years beginning on or after January 1, 2022) and who pay no more than 30% of their gross household income for mortgage principal, interest, property taxes, and property insurance (PITI).
"Donation" means money, securities, or real or personal property that is
donated to a not-for-profit sponsor that is used solely for costs associated
with either (i) purchasing, constructing, or rehabilitating an affordable
housing project in this State, (ii) an employer-assisted housing project in
this State, (iii) general operating support, or (iv) technical assistance as
defined by this Section.
"Employer-assisted housing project" means either down-payment assistance,
reduced-interest mortgages, mortgage guarantee programs, rental subsidies, or
individual development account savings plans that are provided by employers to
employees to assist in securing affordable housing near the workplace, that
are restricted to housing near the workplace, and that are restricted to
employees whose gross household income is at or below 120% of the area median
"General operating support" means any cost incurred by a sponsor that is a
part of its general program costs and is not limited to costs directly incurred
by the affordable housing project.
"Geographical area" means the metropolitan area or county designated as an
area by the federal Department of Housing and Urban Development under Section 8
of the United States Housing Act of 1937, as amended, for purposes of
determining fair market rental rates.
"Median income" means the incomes that are determined by the federal
Department of Housing and Urban Development guidelines and adjusted for family
"Project" means an affordable housing project, an employer-assisted housing
project, general operating support, or technical assistance.
"Sponsor" means a not-for-profit organization that (i) is organized as a
not-for-profit organization under the laws of this State or another
state and (1) for an affordable housing project, has as one of its purposes the
development of affordable housing; (2) for an employer-assisted housing
project, has as one of its purposes home ownership education; and (3) for a
technical assistance project, has as one of
its purposes either the development of affordable housing or home ownership
education; (ii) is organized
for the purpose of constructing or rehabilitating affordable housing units and
been issued a ruling from the Internal Revenue Service of the United States
Department of the Treasury that the organization is exempt from income taxation
under provisions of the Internal Revenue Code; or (iii) is an organization
designated as a community development corporation by the United States
government under Title VII of the Economic Opportunity Act of 1964.
"Tax credit" means a tax credit allowed under Section 214 of the Illinois
Income Tax Act.
"Technical assistance" means any cost incurred by a sponsor for project
planning, assistance with applying for financing, or counseling services
provided to prospective homebuyers.
(b) A sponsor must apply to an administrative housing agency for approval of the project. The
agency must reserve a specific amount of tax credits for each approved project.
Tax credits for general operating support can only be reserved as part of a
reservation of tax credits for an affordable housing project, an
employer-assisted housing project, or technical assistance. No tax credits
shall be allowed for a project without a reservation of such tax credits by an
administrative housing agency for that project.
(c) The Authority must adopt rules
criteria for eligible costs and donations, issuing and verifying tax credits,
and selecting projects that are eligible for a tax
(d) Tax credits for employer-assisted housing projects are limited to
that pool of
tax credits that have been set aside for employer-assisted housing. Tax
credits for general operating support are limited to 10% of the total tax
credit reservation for the related project (other than general operating
support) and are also limited to that pool of
credits that have been set aside for general operating support. Tax credits
for technical assistance are limited to that pool of tax credits that have been
set aside for technical assistance.
(e) The amount of tax credits reserved by the administrative housing agency
for an approved project is limited to $32,850,352 in State fiscal years 2022 and 2023 and shall
increase by 5% each fiscal year thereafter. The City of Chicago shall receive 24.5% of total tax
credits authorized for each fiscal year. The
Authority shall receive the balance of the tax credits authorized for each
fiscal year. The tax credits may be used anywhere in this State.
credits have the following set-asides:
(1) for employer-assisted housing projects, $2
(2) for general operating support and technical
The balance of the funds must be used for affordable housing
During the first 9 months of a fiscal year, if an administrative housing
agency is unable to reserve the tax credits set aside for the purposes
subsection (e), the administrative housing agency may reserve the tax credits
for any approved projects.
(f) The administrative housing agency that reserves tax credits for an
affordable housing project must record
against the land upon which the affordable housing project is located an
instrument to assure that
the property maintains its affordable housing compliance for a minimum of 10
years. The Authority has flexibility to assure that the instrument
not cause undue hardship on homeowners.
(Source: P.A. 102-175, eff. 7-29-21.)