7.16.2 Full Term Tax Abatement
HUD Multifamily Accelerated Processing (MAP) Guide, HUD Handbook 4430.G (2020 ed., rev. Mar. 19, 2021) · 2026 edition · updated 2026-10-05 · United States
A. If the amount of the tax abatement is fixed and runs the entire term of the mortgage, the real estate tax expense reported on form HUD-92264 must be the actual amount of taxes the project will pay, if any. The full amount of the real estate taxes without the abatement must be noted in the remarks section of form HUD-92264. The project will benefit from an increased mortgage amount due to the lower pro-forma operating expenses and an increased NOI estimate. When the abatement runs for the full term of the mortgage, the NOI used for form HUD-92264-A Criteria 5 may also be processed at the reduced tax amount.
B. Also, if value attributable to long term tax abatement is recognized in the subject’s market area, the same NOI may be capitalized and the resulting value may be used in Criterion 3. Attributing value to the abatement is allowable only if the abatement is transferable.
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Chapter 7 Valuation & Market Analysis 7.16 Tax Abatement Procedures
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