Compliance

Overview of IRS' LIHTC Disaster Relief Provisions

September 28, 2017    

When the President declares a major disaster under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, LIHTC sites are afforded temporary relief from certain requirements of the LIHTC program. As a result of Hurricanes Maria, Irma, and Harvey, major disaster declarations have...

Avoid Eight Mistakes that Disqualify Low-Income Units

August 30, 2017    

To qualify your site for the tax credit program, you must lease up enough units to qualified low-income households. But those units don’t automatically stay low-income for the rest of the compliance period. As a tax credit site’s manager, you must follow rules to make sure units stay...

Have Leasing Agents Follow Six Dos & Don’ts to Avoid Noncompliance

May 31, 2017    

Good leasing agents can help you fill vacancies quickly with qualified households. But if your agents don’t know enough about the tax credit law, they can also create problems. For instance, there’s no way to know whether prospects are eligible until you’ve calculated and...

Check Whether Section 504 Applies to Your Site

May 31, 2017    

Section 504 of the Rehabilitation Act of 1973 bans disability-based discrimination in any program or activity that receives federal financial assistance from any federal agency (including HUD) or in any programs conducted by federal agencies. Many tax credit managers haven’t heard of this...

Ask Five Questions to Get Key Info for Meeting Site's Minimum Set-Aside

April 27, 2017    

As a tax credit manager, meeting your site’s minimum set-aside is the most important goal. If you meet the set-aside, the owner of your site will be entitled to claim its tax credits. If you don’t meet the set-aside, your site won’t qualify for the tax credit program, which...

Four Tips to Avoid Mistakes in Tax Credit Calculations

March 30, 2017    

A key aspect of your job as a tax credit manager is performing calculations. For instance, you must perform calculations to correctly determine whether a household is eligible to occupy a low-income unit, how much rent you can charge, and how many low-income units you need to set aside at your...

How to Prevent Problems When Owners Forget to Elect Minimum Set-Aside

December 21, 2016    

Every tax credit site must meet and maintain a “minimum set-aside” throughout the 15-year compliance period to qualify for the tax credit program. To meet the set-aside, you must rent a certain percentage of the units in your building or site to qualified low-income households.

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Follow Four Tips to Prevent Owners from Losing Credits Claimed Too Soon

November 29, 2016    

In the Fall 2016 Special Issue, we discussed how a site owner may comply with first-year certification requirements under Internal Revenue Code (IRC) Section 42(l)(1). Making the certification involves Form 8609, Low-Income Housing Credit Allocation and Certification. The agency executes Part I...

How to Set Up Household Files to Save Time and Avoid Tax Credit Recapture

November 29, 2016    

At some tax credit sites, setting up a household file may mean randomly tossing all the paperwork concerning a household into a folder. Or household files may be organized in a way that’s understood by only one or two staffers. But practices like these can cost the owner its tax credits....

Meet Requirements of Annual Certification to State Housing Agency

November 7, 2016    

As the end of the calendar year nears, your site’s annual certification to your state housing agency is approaching. Under Treasury Regulation Section 1.42-5(c)(1), owners are required to certify to the state agency that allocated the credit at least annually that, for the preceding 12-...

How to Comply with IRC Section 42(l)(1), First-Year Certification

November 7, 2016    

In addition to annual certifications, owners are required to complete a “First-Year Certification” under Internal Revenue Code (IRC) Section 42(l)(1). The certification is made to identify specific information needed for the administration of the program and document specific...

Prevent NAU Rule Violations Triggered by Household Composition Changes

September 29, 2016    

You probably know that when a low-income household’s income exceeds 140 percent of the income limit (or 170 percent in the case of deep rent-skewed units), you must follow the Next Available Unit (NAU) rule to make sure the owner can continue claiming credits for the over-income unit. But...

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