Additional low-income housing credit allocations

(a) In general For purposes of section 42 of the Internal Revenue Code of 1986, the State housing credit ceiling for any State for each of calendar years 2026 and 2027 shall be increased by the aggregate housing credit dollar amount allocated by the State housing credit agencies of such State for such calendar year to buildings located in any qualified disaster zone in such State. (b) Limitation (1) Application of aggregate limitation The increase determined under subsection (a) with respect to any State shall not exceed— (A) in the case of any such increase determined for calendar year 2026, the applicable dollar limitation for such State, and (B) in the case of any such increase determined for calendar year 2027, the applicable dollar limitation for such State reduced by the amount of any increase determined under subsection (a) with respect to such State for calendar year 2026. (2) Applicable dollar limitation For purposes of this subsection, the term applicable dollar limitation means, with respect to any State, the product of $8.25 multiplied by the population of such State (as determined for calendar year 2025). (c) Extension of placed in service deadline for designated housing credit dollar amounts (1) In general In the case of any housing credit dollar amount which is allocated by a State housing credit agency of a State for calendar year 2026 or 2027 to a building located in a qualified disaster zone in such State and which is designated (at such time and in such manner as the Secretary may provide) by such State housing credit agency as housing credit dollar amount to which this subsection applies, section 42(h)(1)(E) of such Code shall be applied— (A) by substituting third calendar year for second calendar year each place it appears, and (B) by substituting 2 years for 1 year in clause (ii) thereof. (2) Application of limitation The aggregate amount of housing credit dollar amount designated under paragraph (1) for any calendar year by all State housing credit agencies of a State shall not exceed the amount determined under subsection (b)(1) with respect to such State for such calendar year. (d) Allocations treated as made first from additional allocation for purposes of determining carryover For purposes of determining the unused State housing credit ceiling for any calendar year under section 42(h)(3)(C) of such Code, any increase in the State housing credit ceiling under subsection (a) shall be treated as an amount described in clause (ii) of such section.