Qualified Basis

Qualified basis is eligible basis multiplied by the percentage of units reserved for low-income tenants. It's the figure actually used to calculate the annual tax credit amount, since credits only apply to the affordable portion of a project.

Example

A property with $8,000,000 in eligible basis, where 80% of units are reserved for low-income tenants, has a qualified basis of $6,400,000.

Formula

Eligible Basis × Applicable Fraction = Qualified Basis

Excel Formula:

• B2 = Eligible Basis
• B3 = Applicable Fraction (% of low-income units)