Workforce Housing Tax Credit Act

A bipartisan bill introduced in Congress would create a new federal tax credit aimed at expanding rental housing for middle-income workers, and it has been referred to the House Committee on Ways and Means. The Workforce Housing Tax Credit Act would establish the Workforce Housing Tax Credit (WHTC), modeled after the long-running Low-Income Housing Tax Credit (LIHTC), to help finance apartments for households earning roughly 60% to 100% of area median income.

Under the proposal, state housing finance agencies would allocate credits to developers through a competitive process. Developers could then sell those credits to investors, who would receive a dollar-for-dollar reduction in federal tax liability over 15 years. The equity raised would cover about half of construction costs for qualifying projects, which must set aside at least 60% of units for households at or below 100% of area median income and keep them affordable for up to 30 years. The bill is designed to complement LIHTC, not replace it, and would apply to buildings placed in service after 2023.

For Milwaukee residents, the measure could help ease pressure on a rental market where many working families fall above traditional low-income thresholds but still struggle with rising rents. By encouraging more housing for teachers, service workers, and other middle-income earners, the credit could support neighborhood stability and reduce displacement in areas facing gentrification or redevelopment. Advocates say the program could help produce hundreds of thousands of new affordable rental homes nationwide if enacted.

The bill now sits with the House Ways and Means Committee, where lawmakers will weigh its cost, structure, and potential impact on the existing LIHTC program. If it advances, sponsors hope to pair it with broader housing and tax legislation later this year.