### Question
What does applicable percentage mean?


### Answer
**Applicable percentage** has the following meaning in *26 U.S.C. § 42*:

> the appropriate percentage prescribed by the Secretary for the earlier of—


(i) the month in which such building is placed in service, or


(ii) at the election of the taxpayer—


(I) the month in which the taxpayer and the housing credit agency enter into an agreement with respect to such building (which is binding on such agency, the taxpayer, and all successors in interest) as to the housing credit dollar amount to be allocated to such building, or


(II) in the case of any building to which subsection (h)(4)(B) applies, the month in which the tax-exempt obligations are issued

#### Citation:
  - *26 U.S.C. § 42*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter A-Determination of Tax Liability > PART IV-CREDITS AGAINST TAX > Subpart D-Business Related Credits**

