Line 11 Worksheet

line 16 would be based on 40% of the line
15 credit for the building. Similarly, although
a taxpayer might not be subject to recapture
upon a disposition of a de minimis portion
(explained later) of the taxpayer’s interest in
the building, no credit is allowed to the
taxpayer for the percentage of the interest
disposed of by the taxpayer. The credit
allowed to the taxpayer for the tax year is
determined by reference to the taxpayer’s
remaining interest in the building at the
close of the tax year.
If the taxpayer follows the procedures to
prevent recapture, the taxpayer is allowed
credit for the year both with respect to the
ownership interest disposed of by the
taxpayer and the interest retained by the
taxpayer. For example, again assume that a
taxpayer owns 100% of a building for the
first 273 days in a 365-day calendar tax year
and 40% of the building for the last 92 days
of the year. After following procedures, the
taxpayer’s credit on line 16 would be based
upon 273/365 of 100% (or 74.79%) of the
line 15 credit for the building plus 92/365 of
40% (or 10.08%) of the line 15 credit
amount.
If a taxpayer follows the procedures to
prevent recapture upon the disposition of
the building or upon a disposition of the
taxpayer’s entire interest in the building, the
taxpayer’s line 16 credit amount is
determined by multiplying the line 15 credit
amount by the percentage interest in the
building disposed of by the taxpayer. For
example, if a building is owned by
individuals A and B (60% by A and 40% by
B) and on the last day of the fifth month of
the tax year, C buys A’s 60% interest in the
building and A follows the procedures, then
A would enter 60% of line 15 on line 16.
(Lines 4 and 8 have already taken into
account the 5 months of the tax year that A
held an interest in the building.)
De minimis recapture rule. For
administrative purposes, the Service has
adopted a de minimis rule that applies to

partners in partnerships (other than
partnerships to which section 42(j)(5)(B)
applies) owning interests in qualified
low-income buildings. The rule allows a
partner to elect to avoid or defer recapture
resulting from a disposition of interest in a
partnership without posting bond (in a
situation where it was necessary to post
bond to avoid or defer recapture) until the
partner has disposed of more than 331/3 %
of the partner’s greatest total interest in the
qualified low-income building through the
partnership. See Rev. Rul. 90-60, 1990-2
C.B. 3, for more information on the de
minimis rule.
Upon application by the building owner,
the IRS may waive any recapture of the
low-income housing credit for any de
minimis error in complying with the minimum
set-aside requirements.
Line 17. The first-year credit may have
been reduced based on the number of full
months the building was in service. The
deferred balance of the credit for the first
year is allowed in the 11th year. Include it on
line 17 as a positive amount.
For example, see the example under
First-year modified percentage, earlier. If
this is the 11th year, enter .8750 times the
eligible basis of the building (line 1) times
the credit percentage (line 5). The factor
.8750 is 1.0000 minus .1250, the modified
percentage figured for year one in the
example.
Line 18. For buildings placed in service
after December 31, 2007, the credit is no
longer limited by the alternative minimum
tax rules. The amount on line 18 will be
reported on Form 8586 as follows.
Credit for buildings placed in service
before January 1, 2008. Report this
amount on line 3 of Form 8586.
Credit for buildings placed in service
after December 31, 2007. Report this
amount on line 10 of Form 8586.

Paperwork Reduction Act Notice. We
ask for the information on these forms to
carry out the Internal Revenue laws of the
United States. You are required to give us
the information. We need it to ensure that
you are complying with these laws and to
allow us to figure and collect the right
amount of tax.
You are not required to provide the
information requested on a form that is
subject to the Paperwork Reduction Act
unless the form displays a valid OMB control
number. Books or records relating to a form
or its instructions must be retained as long
as their contents may become material in
the administration of any Internal Revenue
law. Generally, tax returns and return
information are confidential, as required by
section 6103.
The time needed to complete and file this
form will vary depending on individual
circumstances. The estimated burden for
individual taxpayers filing this form is
approved under OMB control number
1545-0074 and is included in the estimates
shown in the instructions for their individual
income tax return. The estimated burden for
all other taxpayers who file this form is:
Recordkeeping . . . . . . . . . . . .
Learning about the law or the
form . . . . . . . . . . . . . . . . . . .
Preparing and sending the form
to the IRS . . . . . . . . . . . . . . . .

1 hr., 59 min.

If you have comments concerning the
accuracy of these time estimates or
suggestions for making this form simpler, we
would be happy to hear from you. You can
write to the Internal Revenue Service at the
address listed in the instructions for the tax
return with which this form is filed.

Line 11 Worksheet (Keep for Your Records)
1 Enter the qualified basis of the building from line 3 of this tax year’s Form 8609-A . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1

2 Multiply the amount on line 1 of the previous year’s Form 8609-A by the amount on line 2 of that Form 8609-A . . . . . . . . .

2

3 Increased qualified basis. Subtract line 2 above from line 1 above. But if line 2 above is more than zero but less than the
original qualified basis of the building entered on Form 8609, line 8a (Part II, line 2a on the 1991 revision), then enter the
amount from line 7 of this Form 8609-A instead
Note. If line 3 above is zero or less, do not complete the rest of this worksheet. Instead, enter -0- on line 11 of Form
8609-A and go to line 12. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3

4 Modified percentage. For each month during the tax year, figure the increase, if any, in the low-income portion of the building
for that month over the low-income portion of the building at the close of the previous tax year (the amount on line 2 of the
previous tax year’s Form 8609-A). For example, if the previous tax year’s low-income portion of .5000 remained at .5000 for
the first 9 months of this tax year and then increased to .7500 for October, November, and December, then subtract .5000
from .7500 to get an increase of .2500 for each month. Add these amounts together, divide by 12, and enter the result. (This
amount must be shown as a decimal carried out to at least four places (for example, .2500 + .2500 + .2500 = .7500, divided
by 12 = .0625.)) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4

5 Increased qualified basis entitled to reduced credit. Multiply line 4 above by Form 8609-A, line 1 . . . . . . . . . . . . . . . . . . .

5

6 Increased qualified basis not entitled to reduced credit. Subtract line 5 above from line 3 above . . . . . . . . . . . . . . . . . . .

6

7 Line 11 modification. Multiply line 6 above by two-thirds of the amount on line 5 of Form 8609-A. Enter the result here and on
line 11 of Form 8609-A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7

-4-

7 hr., 38 min.
1 hr., 47 min.