NCSHA Urges IRS to Improve Housing Credit Disaster Relief Guidance

The National Council of State Housing Agencies (NCSHA) recently sent comments to the IRS on how it can improve LIHTC disaster relief guidance provided in Revenue Procedures 2014-49 and 2014-50. NCSHA submitted a letter in response to the IRS’ request for comments in Notice 2019-52. Specifically, NCSHA urged the IRS to expand its disaster relief guidance to:

• Address the treatment of residents returning to an affected property following a natural disaster, including whether the property owner is required to recertify residents before they can return to the property and, if so, how to handle residents who may be over-income upon their return if they were income-qualified upon initial occupancy;
• Clarify that owners must maintain compliance in non-damaged units if only a portion of the property is affected by natural disaster (for example, flooding that affects only the ground floor of a development);
• Consider the issue of destroyed records following a natural disaster — whether an owner is required to attempt recreation of destroyed records and, if not, the relief provided to those owners in this case;
• Provide a process for LIHTC allocating agencies to request from the IRS an extension of relief period deadlines for projects affected by multiple disaster events regardless of whether the successive disaster was designated a presidentially declared disaster; and
• Consider expanding certain relief provided in this guidance to properties affected by casualty losses, even if the loss does not result from a presidentially declared disaster.