The Push for Tax Credit Reform

Abstract

The Low-Income Housing Tax Credit Program has been a popular tool for providing affordable housing in the United States over the past 30 years. Despite its popularity, many scholars and political leaders scrutinize the program for its role in exacerbating social issues, such as poverty concentration and racial segregation in urban areas. This article explores the role that each state’s Qualified Allocation Plan (QAP) plays in distributing these low-income housing tax credits to developers and the ways in which the QAP may contribute to these social issues. Specifically, the article looks at the state of Missouri and the City of St. Louis as an example of where the autonomy granted to states to oversee credit allocation may work against the overall intentions of the LIHTC program and where potential reform could be successful.