One of the tax breaks New York offers which is called the NYS Low Income Housing Tax Credit Program a Brooklyn developer decided to take advantage of was a deal that allowed him to take advantage of a $300,000 tax break provided he made at least half of the apartments in the building he owned less than certain amount. The developer took advantage of the tax break, but failed to lower the rent charged for the apartments. In November 2014, the IRS was able to get justice when the developer formally agreed to pay a tax settlement of $500,000.
There was a time when the developer might have been able to get away with the scheme, but New York State’s Attorney General, Eric Schneiderman, is fed up with the landlords in the state reneging on their promise to provide affordable housing to the people who need it, but taking advantage of tax breaks.
Mayor de Blasio has agrees. The mayor has always been a supporter of affordable housing and is would like to be able to either make at least 200,000 homes available to people who need financial assistance in the next decade. The sheer number of landlords taking advantage of the program is a major problem. It’s estimated that as a result of failing to offer the type of housing needed to qualify for the tax break is costing New York a great deal.
De Blasio isn’t happy about the situation. “We need to get the most out of every dollar we spend, and it is vital that the people with whom we do business treat their workers fairly and deliver the affordable housing they promise.”
The Low Income Housing Tax Credit program has been used nationwide and as long as everyone uses the program correctly, not only does the program drastically reduce the nations homeless rate, it’s also good for the economy. According to the National Association of Home Builders the program has been used to generate approximately $7.1 billion each year while also helping support 95,000 jobs.
The Low Income Housing Tax Credit program is just one example of a program business owners can take advantage of in order to get a break on their taxes. Before signing up for one of these programs it’s always a good idea to consult with a tax settlement attorney who understand the finer nuances of the government’s program and will help you set things up so you can run a profitable business and not violate the terms set by the government.
The wonderful thing about having tax settlement attorney on your side right as you start your business is that they’ll help you get the most out of applicable government programs, help you work with the IRS if you’re business is audited, and defend you if the IRS ever claims that you owe back taxes.