Set-Aside Tests

Also called: 20/50 Test, 40/60 Test, Income Averaging

Set-aside tests are the minimum share of units a LIHTC property must reserve for lower-income tenants to qualify for tax credits. Common options are 20% of units at 50% of AMI, 40% of units at 60% of AMI, or income averaging, which allows a mix of income levels as long as the average stays at or below 60% of AMI.