On Friday, October 3, 2014, HUD released a notice announcing new “Qualified Census Tract” (“QCT”) and “Difficult Development Area” (“DDA”) designations for purposes of the low-income housing tax credit under Section 42 of the Internal Revenue Code. Section 42(d)(5)(B) of the Code provides an eligible basis increase of 30% for buildings located in a QCT or DDA, allowing such buildings to qualify for additional tax credits. HUD makes new DDA designations annually, and revised its list of QCTs for 2015 to incorporate updated income and poverty measures.

Notably, the 2015 list of metropolitan DDA designations will be the last of HUD’s designations for entire metropolitan areas. HUD previously announced that beginning with 2016 DDA designations, DDA status for metropolitan areas would be determined based on data derived from smaller geographic areas within a particular metropolitan community.

A copy of the HUD notice can be found here.