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Official form guide
Form 8586: Low-Income Housing Credit
IRS Form 8586 is used to claim the low‑income housing credit and must be filed by estates and trusts. The credit is generally taken over a 10‑year credit period.
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IRS Form 8586 - Low-Income Housing Credit
IRS Form 8586 is used to claim the low‑income housing credit and must be filed by estates and trusts. The credit is generally taken over a 10‑year credit period.
Risk Radar
Scan points- 1Failing to report the correct line 7 amount can trigger credit recapture.
- 2Omitting the amount allocated to beneficiaries on line 6, which is required for estates and trusts.
- 3Not subtracting line 6 from line 5, resulting in an incorrect line 7 credit amount.
- 4Reporting the line 7 credit on the wrong form or line instead of Form 3800, Part III, line 4d.
- 5Failing to retain Forms 8586, 8609, 8609‑A, and 8611 for three years after the 15‑year compliance period.
Plain English
Form 8586 tells the IRS how much low‑income housing credit an estate or trust can claim. You report the amount allocated to beneficiaries and the amount to carry forward on the main tax credit form.
Submission Date
- Filing date: 2023-12-07 22:10:28
- Preparation window: collect IDs, supporting records, and signatures in advance.
- Final review: verify names, dates, and required fields before submission.
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What this form is for
- Use this form when you need to claim the low-income housing credit on your tax return, especially if you are an estate or trust.
- Do not use it when you are a partnership, S corporation, or a taxpayer whose only credit source is from those pass-through entities.
- Check Form 3800 instead when the credit can be reported directly on Form 3800, Part III, line 4d.
Form selector
Use this form or another form?
Estate or trust allocating credit to beneficiaries
Used to allocate low-income housing credit between estate/trust and beneficiaries
✓ Confirm estate/trust status and beneficiary allocation
Partnership or S corporation reporting credit
Credit reported on Schedule K instead of Form 8586
✓ Verify partnership/S-corp filing status
Taxpayer with credit only from pass-through entities
Credit can be reported directly on Form 3800, Part III, line 4d
✓ Ensure no other credit sources require Form 8586
Deadline or filing window
Not stated in the official source.
Checklist
What you need before filling it out
Line 2 – Decrease in qualified basis?
Answer Yes/No and BINs if Yes · Form 8586, line 2
Line 3 – Current year credit from attached Form 8609-A
Total credit from Form 8609-A · Form 8609-A attached to Form 8586
Line 4 – Credit from partnerships, S corporations, estates, trusts
Credit amount from those entities · Form 8586, line 4
Line 6 – Amount allocated to beneficiaries
Beneficiary share amount · Form 8586, line 6 (estates/trusts)
Name(s) shown on return
Taxpayer name as on tax return · Top of Form 8586
Before you submit
- 1Confirm the revision date reads 12/2023.
- 2Match the name(s) and identifying number to the tax return.
- 3Enter the number of attached Forms 8609-A in line 1.
- 4Answer line 2 accurately and list any building identification numbers.
- 5Attach all Forms 8609-A that calculate the credit.
- 6Enter the total credit from attached Forms 8609-A on line 3.
- 7Enter any credit from partnerships, S corporations, estates, or trusts on line 4.
- 8For estates/trusts, allocate the credit to beneficiaries and record the amount on line 6.
- 9Retain a copy of Form 8586 and all attachments for three years after the compliance period ends.
How to file this form
- 1Gather Forms 8609, 8609-A, and any Form 8611 needed, and keep them organized.
- 2Complete Form 8586, filling lines 1-7 as applicable, and sign if required.
- 3Attach all required Forms 8609-A (and Form 8611 if recapture) to Form 8586.
- 4Include the completed Form 8586 with your tax return or with Form 3800/Schedule K as instructed, and verify attachment.
- 5File the return with the IRS and retain a copy of Form 8586 and attachments for three years after the 15-year compliance period ends.
Known limitations
- 1Form 8586 is not required for taxpayers whose only low‑income housing credit comes from partnerships, S corporations, estates, or trusts; they report the credit on Form 3800.
- 2Partnerships and S corporations do not complete Form 8586; they report their credit share on Schedule K.
- 3The credit may be claimed only for residential rental buildings in low‑income housing projects that satisfy a minimum set‑aside test.
- 4The credit amount cannot exceed the amount allocated to the building.
- 5If a building’s qualified basis decreases, a portion of the credit may need to be recaptured using Form 8611.
Field map
Compact field-by-field guide
General Info
2 items
Full legal name and taxpayer identification number (SSN or EIN).
Current mailing address.
Details
2 items
Complete all applicable sections of this form according to the official IRS instructions.
Enter the relevant dollar amount if this form involves tax calculation.
Certification
1 items
Read and acknowledge any certifications required by this form.
Signatures
1 items
Sign and date. Unsigned forms cannot be processed.
Almost done reviewing the fields?
Fillable formOpen in Editor->Form 8586 is the December 2023 revision (Rev. 12-2023) and directs filers to www.irs.gov/Form8586 for the latest information; the only change noted is the removal of column references in lines 5 and 7 to match the Form 3800 redesign.
What changed or needs a fresh check
- Edition date — confirm the form revision reads 12/2023.
- Fee — Not stated in the official source.
- Mailing address — Not stated in the official source.
- Signature — Not stated in the official source.
- OMB number — confirm OMB No. 1545-0984 appears on the form.
Quick Facts
Downloads
After you file
- 1Keep a copy of the filed Form 8586 attached to your tax return.
- 2Retain Forms 8609, 8609‑A, and 8611 for three years after the 15‑year compliance period ends.
- 3Monitor the qualified basis of each building for reductions that could trigger recapture.
- 4If a recapture is required, file Form 8611 to report the recaptured amount.
- 5If an error is discovered on Form 8586 after filing, submit an amended return with the corrected form.
- 6Expect an IRS acknowledgment that the return, including Form 8586, was accepted.
Sources
- SRCForm p.1 — Taxpayers, other than partnerships, S corporations, estates, or trusts, whose only source of this credit is from those pass‑through entities, are not required to complete or file this form.
- SRCForm p.1 — Partnerships and S corporations, stop here and report this amount on Schedule K.
- SRCForm p.1 — The low‑income housing credit can only be claimed for residential rental buildings in low‑income housing projects that meet one of the minimum set‑aside tests.
- SRCForm p.1 — The credit cannot exceed the amount allocated to the building.
- SRCForm p.1 — If there is a reduction in the qualified basis of the building, you may have to recapture a part of the credit; use Form 8611.
- SRCForm p.1 — Recordkeeping Keep a copy of this Form 8586 and all Forms 8609, 8609‑A, and 8611 for 3 years after the 15‑year compliance period ends.
- SRCForm p.1 — If the estate or trust is subject to the passive activity rules, include on line 4 any low‑income housing credits from passive activities disallowed for prior years and carried forward to this year.
- SRCForm p.1 — Estates and trusts, go to line 6. All others, stop here and report this amount on Form 3800, Part III, line 4d.
Common confusion points
Do I need to file Form 8586 if I only receive the credit through a partnership?
Filers assume all credit recipients must use the form, but the source exempts those whose only source is pass‑through entities.
→ Verify that the credit originates solely from a partnership, S corporation, estate, or trust and report it on Form 3800 instead.
Where should an estate report its low‑income housing credit?
Estates have separate lines (5, 6, 7) and a different reporting location, causing confusion.
→ Use line 5 for total credit, line 6 for amount allocated to beneficiaries, subtract to get line 7, and report the result on Form 3800, Part III, line 4d.
Can I claim the credit for a non‑residential building?
The credit is limited to residential rental buildings, but filers may overlook this restriction.
→ Confirm the building is a residential rental and meets the minimum set‑aside test before claiming the credit.
What happens if the qualified basis of my building decreases?
A basis reduction may trigger credit recapture, which many overlook.
→ Review the reduction and, if applicable, complete Form 8611 to report any recaptured credit.
Do I need to include passive activity credits on line 4 for an estate?
Estates subject to passive activity rules must report disallowed credits carried forward, which can be missed.
→ If the estate is subject to passive activity rules, include those credits on line 4 and complete Form 8582‑CR to determine the allowed amount.
How long must I keep records for Form 8586?
Record‑keeping periods are often misunderstood.
→ Retain Form 8586 and all related Forms 8609, 8609‑A, and 8611 for three years after the 15‑year compliance period ends.
Workflow map
Related forms and next steps
Before
Current
After
Often used with
⚠ If something goes wrong
- Form 8611 – Recapture of Low‑Income Housing Credit, used when a basis reduction requires credit recapture.
Questions about IRS Form 8586
What is IRS Form 8586 used for?
Form 8586 tells the IRS how much low‑income housing credit an estate or trust can claim. You report the amount allocated to beneficiaries and the amount to carry forward on the main tax credit form.
Who must file IRS Form 8586?
Estates and trusts must file IRS Form 8586.
What information does IRS Form 8586 require?
The form reports the amount allocated to beneficiaries (line 6) and the remaining credit to be reported on Form 3800, Part III, line 4d (line 7).
How do I complete IRS Form 8586?
Enter the credit amount allocated to beneficiaries on line 6. Subtract that amount from line 5 to calculate line 7, then report line 7 on Form 3800, Part III, line 4d. Keep a copy of Form 8586 and related Forms 8609, 8609‑A, and 8611 for three years after the 15‑year compliance period ends. Sign the form before sending it.
What happens if IRS Form 8586 is filed incorrectly?
If the reported amounts are incorrect, the credit may be subject to recapture, requiring filing Form 8611.
Do I need to file Form 8586 if I only receive the credit through a partnership?
Filers assume all credit recipients must use the form, but the source exempts those whose only source is pass‑through entities. Verify that the credit originates solely from a partnership, S corporation, estate, or trust and report it on Form 3800 instead.
Where should an estate report its low‑income housing credit?
Estates have separate lines (5, 6, 7) and a different reporting location, causing confusion. Use line 5 for total credit, line 6 for amount allocated to beneficiaries, subtract to get line 7, and report the result on Form 3800, Part III, line 4d.
Can I claim the credit for a non‑residential building?
The credit is limited to residential rental buildings, but filers may overlook this restriction. Confirm the building is a residential rental and meets the minimum set‑aside test before claiming the credit.
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