Ohio Agency Releases Mandatory Lease Addendum for LIHTC Sites

In response to receiving a significant increase in resident complaints regarding lease non-renewal, lack of good cause eviction, and other termination of tenancy, Ohio’s Office of Program Compliance recently revised the Low-Income Housing Tax Credit Lease Addendum currently used at LIHTC sites. The revised lease must be used by owners and property managers effective Jan. 1, 2016. For residents that are in place prior to Jan. 1, 2016, owners/property managers should use the revised addendum at the time of annual recertification or verification of student status.

The IRS makes clear that termination/eviction in a LIHTC site can be done only on the basis of good cause. Non-renewal of the lease does not constitute good cause. IRS Revenue Rule 2004-82 provides in relevant part: “Section 42(h)(6)(B)(i) requires that an extended low income housing commitment include a prohibition during the extended use period against (1) the eviction or the termination of tenancy (other than for good cause) of an existing tenant of any low income unit (no-cause eviction protection).”

According to the agency, failure to use the revised addendum may result in the issuance of Form 8823 and/or placement on the agency’s watch list, which could limit an owner’s ability to access program funding.