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4 Percent Only HTC for Use with Projects Financed by Tax-Exempt Volume Limited …
Final Housing Tax Credit Allocation or Award Certification - Form 8609
Qualified Allocation Plan
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Rent and Income Limits
MF Consolidated Request for Proposals & Housing Tax Credits Funding Selections
Prevailing Wage Requirements
Underwriting Standards

4% Housing Tax Credits

Minnesota Housing administers 4% Housing Tax Credits (HTCs) according to Section 42 of the Internal Revenue Code. Under certain circumstances, 4% HTCs, which are not from the state annual credit ceiling, may be available for projects that are financed with tax-exempt volume limited bonds.

Minnesota Management and Budget (MMB) administers the state’s tax-exempt volume limited bonding authority for all issuers in the state, including Minnesota Housing. Projects that receive an allocation of bonding authority must separately request an award of 4% HTCs from Minnesota Housing or the applicable suballocator, depending on the issuer and location of the project.

Minnesota Housing’s Qualified Allocation Plan (QAP) is the agency’s plan for the distribution of HTCs. The project must comply with the QAP that is in effect for the calendar year in which tax-exempt volume limited bonds are issued sufficient, together with any tax-exempt volume limited bonds issued in a prior calendar year, to finance at least the required minimum percentage of the aggregate basis of the building and the land it is located on. Check the applicable QAP and any amendments for details.

Housing Tax Credit Documents

Apply for 4% Housing Tax Credits

4% HTCs are available year-round. There are two ways to apply for 4% HTCs from Minnesota Housing:

  • Multifamily Consolidated Request for Proposals (RFP) – Projects selected for deferred funds with a 4% HTC financial structure where Minnesota Housing is the bond issuer must apply for 4% HTC by submitting a 42M application in the Multifamily Customer Portal. The checklist is located within the funding round that the project was selected.
  • 4% HTC Only Round – Projects expected to be financed with tax-exempt volume limited bonding authority from MMB that don’t need or have not been awarded funding from Minnesota Housing must apply through the applicable 4% HTC Only Round in the Multifamily Customer Portal.
     

4% HTC Only Round

Minnesota Housing is currently accepting pre-applications for an award of 2027 4% HTC Only for projects expected to be financed with tax-exempt volume limited bonding authority from MMB. The optional pre-application provides preliminary predictive cost model and scoring determinations and must be submitted at least 30 days prior to the submission of the full 42M application.

Starting Tuesday, January 12, 2027, Minnesota Housing will begin accepting full 42M applications, which must be submitted at least 60 days prior to bond issuance.

Pre-applications and full 42M applications must be submitted using Minnesota Housing's online Multifamily Customer Portal. Review the Multifamily 4% Housing Tax Credit Only Standards for more information.

State Prevailing Wage Requirement

In the 2024 legislative session, the state prevailing wage statutes (Minnesota Statute 116J.871) were amended to include new reporting requirements and to broaden prevailing wage applicability for multifamily rental housing projects that receive funding from Minnesota Housing.

Projects selected for an award or allocation of federal low-income housing tax credits (Housing Tax Credits) on or after January 1, 2025: For purposes of an award, selection is defined as the issuance of the 42M preliminary determination letter by Minnesota Housing. For purposes of an allocation, selection is defined as Minnesota Housing board action to select a project for future reservation and allocation of LIHTC through Round 1 or Round 2.

Visit Minnesota Housing’s Prevailing Wage webpage and review the Frequently Asked Questions document for more information on the prevailing wage requirements, applicability, and reporting.

eNews Information

Sign up for our eNews to receive timely updates about 4% HTCs available for projects financed with tax-exempt volume limited bonds.

Technical Assistance

Technical assistance with Minnesota Housing staff is available and strongly encouraged throughout the process. 

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