Affordable Housing Tax Credit Limited Partnership

3 Months Ended

Mar. 31, 2023

Equity Method Investments and Joint Ventures [Abstract]

Affordable Housing Tax Credit Limited Partnership

AFFORDABLE HOUSING TAX CREDIT LIMITED PARTNERSHIP INVESTMENTS

LCNB is a limited partner in multiple limited partnerships that sponsor affordable housing projects utilizing the Low Income Housing Tax Credit pursuant to Section 42 of the Internal Revenue Code. The purpose of the investments is to achieve a satisfactory return on capital, to facilitate the sale of additional affordable housing product offerings, and to assist in achieving goals associated with the Community Reinvestment Act. The primary activities of the limited partnerships include the identification, development, and operation of multi-family housing that is leased to qualifying residential tenants.

The following table presents the balances of LCNB's affordable housing tax credit investments and related unfunded commitments at March 31, 2023 and December 31, 2022 (in thousands):

	March 31, 2023		December 31, 2022
Affordable housing tax credit investment	$	16,950	16,950
Less amortization	3,625		3,268
Net affordable housing tax credit investment	$	13,325	13,682
Unfunded commitment	$	6,852	7,185

The net affordable housing tax credit investment is included in other assets and the unfunded commitment is included in accrued interest and other liabilities in the consolidated condensed balance sheets.

LCNB expects to fund the unfunded commitment over ten years.

The following table presents other information relating to LCNB's affordable housing tax credit investments for the three months ended March 31, 2023 and 2022 (in thousands):

	Three Months Ended March 31,
	2023		2022
Tax credits and other tax benefits recognized	$	430	357
Tax credit amortization expense included in provision for income taxes	357		297