Don't Round Down to Meet Minimum Set-Aside

Don't round down the number of units you must rent to qualified low-income households to meet your minimum set-aside, warns A.J. Johnson, president of A.J. Johnson Consulting Services. Rounding down may seem like an attractive option because it leaves you free to charge market-rate rents for one more unit, he admits. But if you round down, you won't meet the set-aside, and the owner won't be able to claim any of its tax credit, he cautions.

For example, say you need to rent 40 percent of your site's 96 units to qualified low-income households. Forty percent of 96 units is 38.4 units. Can you round to the nearest whole number and rent only 38 units to qualified low-income households? No. You need to rent at least 39 units to qualified low-income households. Anything less would fall short of 40 percent, Johnson explains.