The U.S. Department of Housing and Urban Development published a notice in the Federal Register establishing 2025 difficult development areas (DDAs) and qualified census tracts (QCTs) for LIHTCs. LIHTC properties built in a DDA or QCT may increase their eligible basis by up to 30 percent. DDAs are areas with high construction, land and utility costs relative to the area median gross income and QCTs are low-income areas based on new income and poverty data released in the American Community Survey (ACS). The 2025 DDAs and QCTs are effective for LIHTC allocations made after Dec. 31, 2024, or for buildings financed by tax-exempt private activity bonds (PABs) if the bonds are issued or the building is placed in service after Dec. 31, 2024. Novogradac will publish the lists of DDAs and QCTs once they are released by HUD.