The US Internal Revenue Service has released new regulations regarding the income averaging option for Low Income Housing Tax Credit housing. Income average is used by LIHTC properties use to serve residents making up to 80% of the median area income. The new regulations address several key issues and provide clarity for the model.

Income averaging has been well supported in the community. NMHC and NAA both supported the rule when it was enacted in the Consolidated Appropriations Act in March 2018. It has helped to create mixed income communities by changing the rules for income qualifications.

According to National Multifamily Housing Council, prior "LIHTC program rules required owners to either rent 40% of their units to households earning no more than 60% of AMI, or 20% to those earning no more than 50% of AMI." Instead, income-averaging rules allow owners to reserve 40% of units for residents that collectively earn below 60% of the average area income.