6/12/2017 2:34:10 PM

By Jo Ikelheimer, MA, RHM, Director of LIHTC Compliance

Hi folks! I thought I would share a few recent questions pertaining to LIHTC that we received through eHotline – our free technical assistance service for those with active NCHM certification.

Q:  Our LIHTC property has two buildings and on question 8b under Part 2 of the 8609 [Are you treating this building as part of a multiple building project for purposes of section 42?], we answered No. I understand that households may need to income-qualify again prior to transferring units, but what if the transfer is in the same building?

A:  If the transfer occurs within the same building (or BIN), then you may treat it as a transfer without the tenant having to requalify. The LIHTC regulations don’t consider tenants to be over-income until their income exceeds 140% of the current applicable income limit, but even if that’s the case then they may still transfer within the same BIN. Under the circumstances that you’ve described, tenants would need to requalify to transfer or move between buildings since the answer to question 8b indicates that your buildings are not being treated as part of a multiple-building project.

Q:  I understand HOME has a rule difference with project-based assistance vs. tenant-based assistance (HCV) concerning tenant paid rent. Is this rule for a HOME only property? Is HOME treated the same way when layered with LIHTC?

A:  For LIHTC, the gross rent paid by Housing Choice Voucher holders may exceed the applicable rent limit for the program but for the HOME program, alone or in combination with LIHTC, the total contribution paid toward rent for HCV (or any type of tenant-based rental assistance) must be at or below the applicable HOME rent limits. For project-based assistance, the same would hold true for LIHTC, but the gross rent may exceed the HOME rent limits under certain circumstances. You can find this guidance in Paragraph 3.3C, page 54 of the HOME Model Program Guide for Owners. Remember to keep the most restrictive requirements in mind when programs are blended in order to stay completely in compliance.

(Speaking of HOME, please note that the 2017 HOME income limits and rent limits were published by HUD and are effective June 15, 2017. Get them here.)

Q:  On one of my tax credit properties, a resident wants to add another adult into the household. We completed the background check. My question is, when do we add this person to the TIC? Do we manually change the last TIC that was done? Do we just verify income information? Or do we wait until the next recertification?

A:  You will need to add the new household member to the most recent TIC and verify their income and assets accordingly. I would run them through your other initial screening criteria as well. I suggest adding them and their information to a new TIC rather than compromising the existing TIC, then getting signatures from the adult household members with the current date. The IRS doesn’t refer to this practice as an interim recertification, but it has the feel of one. Try to do it before the new household member moves in, understanding that it won’t change the effective date of the next annual recert if you’re doing those at your property.

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