Texas and Oklahoma Sites Get LIHTC Disaster Relief
President Obama recently signed a disaster declaration for areas of Oklahoma and Texas affected in May by severe storms, tornadoes, and floods. The IRS’s Revenue Procedures 2014-49 and 2014-50 provide guidance on temporary relief from certain requirements of Internal Revenue Code (IRC) Sections 42 and 142, respectively, in the context of a major disaster.
After the president’s declarations, the Federal Emergency Management Agency (FEMA) announced that federal disaster aid will be made available to supplement state and local efforts in those areas. Among other federal assistance, multifamily properties in disaster areas financed by the LIHTC and tax-exempt bonds are eligible for relief under the IRC.
This relief includes temporarily suspending certain income limitations for displaced individuals; eliminating the need to self-certify income eligibility; permitting an allocating agency to allow a property owner to provide emergency housing relief to displaced individuals from other jurisdictions; and modifying the safe harbor relating to the amount of credit allowable to a restored building. Another provision protects existing LIHTC property tenants from being evicted solely to provide emergency housing relief for displaced individuals. Disaster zones may also be eligible for certain relief from carryover allocation, placed-in service requirements, and recapture.