Using the Low-Income Housing Tax Credit to Fund Assisted Living: Mapping the Current Environment

The Low-Income Housing Tax Credit (LIHTC) has been responsible for creating more units of affordable housing than any other federal program. However, the extent to which it has been used to finance the development of assisted living (AL) is unknown. The objective of this study is to understand the prevalence of LIHTC-funded AL and how ALs funded with LIHTC differ from other ALs.

We linked the Department of Housing and Urban Development's LIHTC database (1987-2022) and a national list of licensed ALs (2023) to identify LIHTC-funded ALs (LIHTC-ALs) operating in 2023.

Nationwide study of the location of ALs funded by LIHTC.

We used geospatial coordinates, street addresses, and property names to link the data. Characteristics of ALs were compared using descriptive statistics.

We identified 197 LIHTC-ALs out of 37,510 total ALs (0.53%) and 50,471 LIHTC properties (0.39%). LIHTC-ALs were highly concentrated in a handful of states including Massachusetts (n = 31), Indiana (n = 26), Iowa (n = 13), Colorado (n = 12), and Maine (n = 12). Thirteen states did not have any LIHTC-ALs. Compared with other ALs, LIHTC-ALs were significantly more likely to be in a medically underserved area (11.7% vs 5.8%, P < .001), less likely to be in a higher-income area (median income of $71,758 vs $87,164, P < .001), and more likely to be in an area with a higher proportion of White individuals (71.1% vs 66.9%, P = .005). In addition, when compared with non-AL LIHTC properties, LIHTC-ALs were more likely to be in a higher-income area (median income of $71,758 vs $59,659.49, P < .001).

LIHTC has been used to fund a small proportion of total ALs, with a high degree of between-state variability. Compared with other ALs, LIHTC-ALs tend to be in areas of lower socioeconomic status and higher medical need, signaling they may serve a different population than other ALs.