What is LIHTC?
Understanding the federal program that makes high-quality affordable housing possible — and why it matters for Las Vegas working families.
The Basics
LIHTC: The Nation's Most Powerful Affordable Housing Tool
The Low-Income Housing Tax Credit — commonly known as LIHTC (pronounced "lie-tech") — is a federal program created by Congress in 1986 that incentivizes private developers and investors to build and rehabilitate affordable rental housing across the United States.
Rather than issuing direct government grants, LIHTC works by awarding federal tax credits to developers who agree to keep rents affordable for working families. Developers then sell those tax credits to private investors — typically banks and corporations — who use them to reduce their federal tax liability. The proceeds from that sale become the equity that funds construction.
The result: high-quality housing gets built with minimal ongoing government subsidy, and working families gain access to homes they can actually afford.
Step by Step
How the LIHTC Program Works
The developer applies to the state housing agency for tax credit allocations. In Nevada, that agency is the Nevada Housing Division (NHD).
If awarded, the developer receives federal tax credits based on the project's eligible costs and the number of affordable units.
The developer sells those tax credits to private investors — banks, corporations, and funds — at a negotiated price. This generates the equity capital needed to build the project.
Construction begins. The developer builds the community to the design and quality standards committed to in the application.
Once complete, the property operates as affordable rental housing for a minimum of 30 years, with rents restricted to levels affordable for families earning 50–60% of the Area Median Income (AMI).
Residents live in high-quality homes at rents they can actually afford — while investors receive their tax credit benefit over a 10-year period.
Two Types of Credits
9% Credits vs. 4% Credits — What's the Difference?
- —Highly competitive — awarded through a state scoring process
- —Covers approximately 70% of a project's eligible development costs
- —Does not require tax-exempt bond financing
- —Best suited for smaller, high-impact projects
SmartPlex Use
- —Less competitive — available alongside tax-exempt bond financing
- —Covers approximately 30% of eligible costs
- —Requires Private Activity Bond (PAB) allocation from the state
- —Best suited for larger-scale developments
SmartPlex Use
Auris at Henderson & Auris at Tenaya
Who We Serve
What is Area Median Income — and Who Does This Serve?
Area Median Income (AMI) is the midpoint income for a given region, calculated annually by the federal government. LIHTC properties restrict rents to levels affordable for households earning a percentage of AMI — typically 50% or 60%.
In the Las Vegas metro, that means Auris Communities serves households earning roughly $35,000–$55,000 per year — nurses, teachers, hospitality workers, first responders, and trade professionals who keep our city running but have been priced out of the housing market.
At Auris Communities, we target households at 50–60% AMI — the working families who earn too much for emergency housing assistance but too little to afford market-rate townhome rents in Las Vegas, which now average $1,800/month — with two-bedroom units ranging from $1,600 to over $1,800 and three-bedroom units reaching $2,000 to $2,400, and even more in desirable corridors like Summerlin.
Our Approach
LIHTC + SmartPlex: A Different Kind of Developer
Most affordable housing looks and feels like affordable housing. SmartPlex was built on a different premise.
We use the LIHTC program as the financial engine — but we build to a standard that competes with market-rate housing. Private entrances. Individual backyards. Smart home technology. Resort-style community amenities. ZERH energy certification.
Our residents don't experience affordability as a compromise. They experience Auris Communities as a home.
For investors, the LIHTC structure provides a federally-backed, inflation-resistant return profile with strong historical performance. Tax credit equity has been one of the most reliable asset classes in real estate for nearly four decades.
For the Las Vegas community, every Auris unit is a family stabilized — a child with a consistent school, a worker with a shorter commute, a household building financial resilience for the first time.
FAQ
Common Questions About LIHTC
Ready to Learn More?
See how SmartPlex is putting LIHTC to work for Las Vegas families and investors.