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SENATE FLOOR VERSION
March 25, 2024
ENGROSSED HOUSE
BILL NO. 4018 By: McBride, Menz, Dollens, and
Munson of the House
and
Seifried of the Senate
An Act relating to revenue and taxation; amending 68
O.S. 2021, Section 2357.403, as amended by S ection 1,
Chapter 139, O.S.L. 2022 (68 O.S. Supp. 2023, Section
2357.403), which relates to affordable housing tax
credits; providing for reallocation of credits; and
providing an effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY 68 O.S. 2021, Section 2357.403, as
amended by Section 1, Chapter 139, O.S.L. 2022 (68 O.S. Supp. 2023,
Section 2357.403), is amended to read as follows:
Section 2357.403 A. This act shall be known and may be cited
as the "Oklahoma Affordable Housing Act ".
B. As used in this section:
1. "Allocation year" means the year for which the Oklahoma
Housing Finance Agency allocates credits pursuant to this section;
2. "Eligibility statement " means a statement author ized and
issued by the Oklahoma Housing Finance Agency certifying that a
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given project qualifies for the Oklahoma Affordable Housing Tax
Credit authorized by this section. The Oklahoma Housing Finance
Agency, under Title 330, Oklahoma Housing Finance Agen cy, Chapter
36, Affordable Housing Tax Credit Program Rules, shall promulgate
rules establishing criteria upon which the eligibility statements
will be issued. The eligibility statement shall sp ecify the amount
of Oklahoma Affordable Housing Tax Credits a llocated to a qualified
project. The Oklahoma Housing Finance Agency shall only authorize
the tax credits created by this section to qualified projects which
are placed in service after July 1, 2015, but which shall not be
used to reduce tax liability acc ruing prior to January 1, 2016;
3. "Federal low-income housing tax credit " means the federal
tax credit as provided in Section 42 of the Internal Revenue Code of
1986, as amended;
4. "Oklahoma Affordable Housing Tax Credit " means the tax
credit created by this section;
5. "Qualified project" means a qualified low -income building as
that term is defined in Section 42 of the Internal Revenue Code of
1986, as amended; and
6. "Taxpayer" means a person, firm or corporation subject to
the tax imposed by Secti on 2355 of this title or an insurance
company subject to the tax imposed by Section 624 or 628 of Title 36
of the Oklahoma Statutes or other financial institution subject to
the tax imposed by Se ction 2370 of this title.
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C. For qualified projects placed i n service after July 1, 2015,
the amount of state tax credits created by this section which are
allocated to a project shall not exceed that of the federal low -
income housing tax credits for a qualified project. The total
Oklahoma Affordable Housing Tax C redits allocated to all qualified
projects for an allocation year shall not exceed Four Million
Dollars ($4,000,000.00). For purposes of this section, the "credit
period" shall mean the period o f ten (10) taxable years and "placed
in service" shall have the same meaning as is applicable under the
federal credit program. Reallocated and rolled over credits will
count against the four-million-dollar limit of their original
allocation year and not count against the limit of the year in which
they are allocated.
D. A taxpayer owning an interest in an investment in a
qualified project shall be allowed Oklahoma Affordable Housing Tax
Credits under this section for tax years beginning on or after
January 1, 2016, if the Oklahoma Housing Finance Agency issues an
eligibility statement for such project, which tax credit shall be
allocated among some or all of the partners, members or shareholders
of the taxpayer owning such interest in any manner agreed to by such
partners, members or shareholders. Such taxpayer ma y assign its
interest in the investment.
E. An insurance company claiming a credit against state premium
tax or retaliatory tax or any other tax imposed by Section 624 or
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628 of Title 36 of the Oklahoma Statutes shall not be required to
pay any additional retaliatory tax under Section 628 of Title 36 of
the Oklahoma Statutes as a result of claiming the credit. The
credit may fully offset any retaliatory tax imposed by Section 628
of Title 36 of the Oklahoma Statutes.
F. The credit authorized by this sect ion shall not be used to
reduce the tax liability of the taxpayer to less than zero ($0.00).
G. Any credit claimed but not used in a taxable year may be
carried forward two (2) subsequent taxabl e years.
H. The owner of a qualified project eligible for th e credit
authorized by this section shall submit, at the time of filing the
tax return with the Oklahoma Tax Commission, an eligibility
statement from the Oklahoma Housing Finance Agency. In the case of
failure to attach the eligibility statement, no cred it under this
section shall be allowed with respect to such project for that year
until required documents are provided to the Tax Commission.
I. If under Section 42 of the Internal Revenue Code of 1986, as
amended, a portion of any federal low -income housing credits taken
on a qualified project is required to be recaptured during the first
ten (10) years after a project is placed in service, the taxpayer
claiming Oklahoma Affordable Housing Tax Credits with respect to
such project shall also be required t o recapture a portion of such
credits. The amount of Oklahoma Affordable Housing Tax Credits
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subject to recapture shall be proportionally equal to the amount of
federal low-income housing credit s subject to recapture.
J. The Oklahoma Housing Finance Agen cy or the Oklahoma Tax
Commission may require the filing of additional documentation
necessary to determine the accuracy of a tax credit claimed.
K. The Oklahoma Affordable Housing Act shall undergo a review
every five (5) years by a committee of nine (9) persons, to be
appointed three persons each by the Governor, President Pro Tempore
of the Senate, and the Speaker of the House of Representatives.
SECTION 2. This act shall beco me effective November 1, 2024.
COMMITTEE REPORT BY: COMMITTEE ON FINANCE
March 25, 2024 - DO PASS