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The IRS recently published a final rule to implement Congress’s 2018 authorization of a third set-aside option for LIHTC sites. Under the LIHTC program, all tax credit owners must formally notify the IRS of their minimum set-aside election for their building or site when they file IRS Form 8609. Meeting your site’s minimum set-aside is the most important goal you have as a tax credit manager. If you meet the set-aside, the owner of your site will be entitled...

It’s not unusual for a household to request a transfer to a new unit at a tax credit site. The household may want to get away from noisy neighbors, want a bigger unit, or have a better view. Or there may be a change in household composition or a reasonable accommodation request for a unit that would meet the needs of a disabled household member better than the current one. Also, the Violence Against Women Act (VAWA) requires tax credit sites to have emergency tran...

If residents at your tax credit site pay for their own utilities, the amount of each unit’s utility allowance affects the maximum monthly rent you can collect from the household. The utility allowance is generally based on an estimate of reasonable household consumption and cost for the unit size. Utility allowances are intended to reflect “typical” utility costs, not actual bills or costs paid by any individual household.

One of the most important jobs for the manager of a tax credit site is keeping the owner informed of how well you’re managing the site. The owner wants to know on a monthly or quarterly basis how well the site is doing financially and to be assured that there are no compliance problems threatening the tax credits. To convey this information most effectively, you should prepare a written management report giving the owner the kind of information it needs to make in...

Tax credit site managers often find themselves spending much time and expense processing applications for ineligible households. Hearing about a good deal, casual visitors may submit applications not realizing that they’ll be considered over-income or student households. One way to increase the chances that those filling out applications at your site qualify for the tax credit program is to educate visitors and anyone expressing interest in housing at your site wh...

President Biden recently unveiled a sweeping plan that aims to create and preserve hundreds of thousands of affordable housing units in the next three years and help close the country’s critical housing supply shortfall within five years. The plan follows recent remarks by President Biden saying that tackling inflation is his top economic priority, noting that housing prices are a key driver of inflation. Administration officials said the plan will help "ease...

LIHTC site owners and managers know that to comply with the vacant unit rule, you must make “reasonable attempts” to rent vacant units to qualified low-income households. The tax credit program’s vacant unit rule allows you to claim credits for tax credit units even if they’re unoccupied. The IRS permits an owner to continue claiming credits for a vacant unit as long as management makes reasonable efforts to rent the vacant unit (or another unit ...

On March 16, President Biden signed into law the latest reauthorization of the Violence Against Women Act (VAWA), a 1994 law that provides resources for survivors and prevention of gender-based, domestic, and sexual violence. VAWA’s renewal took on added urgency because of an alarming spike in domestic violence that coincided with the coronavirus pandemic. According to experts, domestic violence often increases during periods when families spend more sustained tim...

The Treasury Inspector General for Tax Administration (TIGTA) recently released a report on IRS oversight of the LIHTC program. The previous Chairman of the Senate Budget Committee, Michael Enzi (R-WY), requested the audit to obtain information about the LIHTC program as part of the committee’s evaluation of the economy, efficiency, and effectiveness of federal housing assistance programs.

On Jan. 11, the IRS issued guidance extending LIHTC program deadlines and providing other compliance accommodations due to the COVID-19 pandemic [IRS Notice 2022-05]. Since the last extension deadline lapsed, industry groups have asked the IRS to extend compliance deadlines for LIHTC sites. The groups pointed to surging COVID-19 cases nationally to justify another extension.