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IRS Releases Updated LIHTC Audit Technique Guide

WASHINGTON – Sept. 18, 2014

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The Internal Revenue Service (IRS) today released its updated audit technique guide (ATG) for the Low-Income Housing Tax Credit (LIHTC) program. The ATG provides guidance for IRS examiners to audit owners of LIHTC properties. It was last updated in 1999. A draft of the guide was released for public comment last December and the IRS accepted comments until the end of March. The revised guide includes, among other changes, an expanded explanation of documents to request from the taxpayer during pre-contact analysis; a more developed definition of “residential rental property;” and a new section on emergency housing relief. The IRS provided an overview of the updates in LIHC Newsletter #56.

Tune in to the Sept. 23 Tax Credit Tuesday podcast to learn more about the changes and what they mean for the LIHTC community. The revised ATG will also be discussed in detail at the Novogradac Affordable Housing Conference, Oct. 9 and 10 in San Francisco.

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IRS Distributes Unused 2014 LIHTC Allocation

WASHINGTON – Sept. 15, 2014

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The Internal Revenue Service (IRS) today published the amounts of unused low-income housing tax credit (LIHTC) carryovers for calendar year 2014 that were allocated to 35 qualified states and Puerto Rico. Revenue Procedure 2014-52 details how $2.59 million of unused LIHTCs were divided among the recipients. California received the largest allocation, $364,756 in LIHTCs.

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Comment Invited on CRA Questions and Answers

WASHINGTON – Sept. 8, 2014

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The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency today invited public comment regarding proposed revisions to the Interagency Questions and Answers Regarding Community Reinvestment. The document provides additional guidance to financial institutions and the public on the agencies’ regulations that implement the Community Reinvestment Act (CRA). Among other things, the proposed new and revised CRA questions and answers address community development-related issues by clarifying guidance on economic development; providing examples of community development loans and activities that are considered to revitalize or stabilize an underserved nonmetropolitan middle-income geography; and clarifying how community development services are evaluated.  

HUD ISSUES FY 2015 FAIR MARKET RENTS CORRECTION

WASHINGTON – Aug. 25, 2014

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The U.S. Department of Housing and Urban Development (HUD) today issued a correction to the proposed fair market rents (FMRs) for fiscal year (FY) 2015 for the Housing Choice Voucher program, Moderate Rehabilitation Single Room Occupancy program and other programs. HUD updated the Schedule B Addendum to include the FMRs for Dallas, Texas, which were missing from the notice published Aug. 15. No other corrections were made. The comment due date remains Sept. 15, 2014.

IRS Issues Disaster Relief Guidance for LIHTC, Bond Properties

WASHINGTON – Aug. 21, 2014

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The Internal Revenue Service (IRS) today released two revenue procedures that provide guidance about temporary disaster relief for qualified developments that were financed by the low-income housing tax credit (LIHTC) or tax-exempt bonds. For rental housing developments in designated major disaster areas, Revenue Procedure 2014-49 and Revenue Procedure 2014-50 provide detailed guidance about temporary relief from certain §42 and § 142(d) requirements, including those concerning carryover allocations, recapture, compliance monitoring, buildings in the first year of the credit period, the amount of credit allowable to a restored building and emergency housing.

Tune into the Aug. 26 Tax Credit Tuesday podcast to learn more.

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HUD Announces Proposed FY 2015 Fair Market Rents

WASHINGTON – Aug. 15, 2014

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The U.S. Department of Housing and Urban Development (HUD) today issued a notice proposing the fiscal year (FY) 2015 fair market rents (FMRs) for the Housing Choice Voucher (HCV) and Moderate Rehabilitation Single Room Occupancy programs. FMRs are used to determine the following: payment standards for the HCV program, initial renewal rents for some expiring project-based Section 8 contracts and initial rents for housing assistance payment contracts in the Moderate Rehabilitation Single Room Occupancy program. They also serve as rent ceilings in the HOME program and in the calculation of maximum award amounts for Continuum of Care grantees. The proposed FMRs do not reflect updates to the methodology used to calculate FMRs.

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Bipartisan Legislation Would Extend LIHTC Eligibility to Homeless Students

WASHINGTON – Aug. 1, 2014

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Sens. Al Franken, D-Minn., and Rob Portman, R-Ohio, yesterday introduced a bill that would extend eligibility to live in low-income housing tax credit (LIHTC) units to full-time students who have experienced homelessness within the past five years. The Housing for Homeless Students Act of 2014 (S. 2723) has been referred to the Senate Committee on Finance.

Tune in to the August 12 Tax Credit Tuesday podcast to learn more about the bill.

LIHTC Bill to Add Appeal Process for Designation of QCTs and DDAs

WASHINGTON – July 29, 2014

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Rep. Pete Gallego, D-Texas, introduced legislation to provide an appeal process for designation as qualified census tracts (QCTs) and difficult development areas (DDAs) under the Low-Income Housing Tax Credit (LIHTC) program. H.R. 5198 was introduced July 24 and has been referred to the House Committee on Ways and Means. The text of the legislation and information about cosponsors will be posted to the Affordable Housing Resource Center when it becomes available.

Tune in to the August 5 Tax Credit Tuesday podcast to learn more about the bill.

Audit Finds Delaware Complied with 1602 LIHTC Exchange Rules

WASHINGTON – July 16, 2014

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The Department of the Treasury’s Office of Inspector General last week released an audit of the Delaware State Housing Authority (DSHA) compliance with the Section 1602 low-income housing tax credit exchange program. The audit found that DSHA substantially met the requirements for receiving its 1602 program award and for allocating those funds to low-income housing developments. However, it found that a Delaware state law prevented DSHA from fulfilling the 1602 program requirement that each state housing credit agency open a financial institution account to receive and disburse program funds. The audit determined that DSHA still met the overall financial management requirement by tracking tax credit exchange program funds in a separate general ledger account.

IRS Solicits Comments on LIHTC Form 8823

WASHINGTON – July 14, 2014

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In a notice in tomorrow’s Federal Register, the Internal Revenue Service (IRS) will invite public comments regarding Form 8823, Low-Income Housing Credit Agencies Report of Noncompliance or Building Disposition. No changes have been proposed to the form at this time, but the estimated burden hours associated with the collection of Form 8823 have been decreased by 69,000 hours to 303,200 hours. Written comments will be accepted through Sept. 13, 2014.

Live Webinar on Community Reinvestment Act Questions and Answers

WASHINGTON – July 11, 2014

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The Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System and the Office of the Comptroller of the Currency (OCC) announced today that they will host a live interagency webinar regarding revisions to the “Interagency Questions and Answers Regarding Community Reinvestment” and the revised “Large Institutions Community Reinvestment Act Examination Procedures” on July 17 at 2 p.m. Eastern. Participants must register by July 17.

Julian Castro Confirmed as HUD Secretary

WASHINGTON – July 9, 2014

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The Senate today confirmed Julian Castro as Secretary of the U.S. Department of Housing and Urban Development. Castro was confirmed by a bipartisan vote of 71-26. He replaces outgoing secretary Shaun Donovan.

Donovan, Castro Nominated to Lead OMB, HUD

WASHINGTON – May 23, 2014

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President Barack Obama today nominated U.S. Department of Housing and Urban Development (HUD) Secretary Shaun Donovan to be the new director of the Office of Management and Budget (OMB). He also nominated San Antonio Mayor Julian Castro to replace Donovan as HUD Secretary. The nominations will now go to the Senate for approval.

Tune in to next week’s Tax Credit Tuesday podcast to learn more.

Reps. Tiberi, Neal to Introduce Permanent 9 Percent, 4 Percent LIHTC Floor

WASHINGTON – May 22, 2014

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Reps. Pat Tiberi, R-Ohio, and Richard Neal, D-Mass., today introduced a bill that would create a permanent floor for the low-income housing tax credit (LIHTC).The bill would establish a fixed 9 percent LIHTC rate for new rental construction property and a fixed 4 percent LIHTC rate for existing property. The bill would only affect the amount of LIHTCs that a housing finance agency may award a particular development and wouldn’t affect the overall amount of state credit allocations. The text of the legislation and information about cosponsors will be posted to the Affordable Housing Resource Center when it becomes available.

Tune in to next week’s Tax Credit Tuesday podcast to learn more about the bill.

Rent & Income Limit Calculator© Updated with HOME Limits

SAN FRANCISCO – April 28, 2014

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Novogradac & Company LLP has released an updated version of the Rent & Income Limit Calculator© featuring the U.S. Department of Housing and Urban Development's (HUD’s) 2014 HOME income limits and rent limits, which are effective on May 1, 2014.

In addition to the 2014 HOME rent and income limits, Novogradac's Rent & Income Limit Calculator © will calculate IRC Section 42(i)(3)(A) low-income housing tax credit (LIHTC) rent and income limits for every county and for every metropolitan statistical area (MSA) in the United States.

Legislation Would Increase LIHTC Allocations to Disaster Areas

WASHINGTON – April 15, 2014

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Last week, a bipartisan group of legislators introduced the National Disaster Tax Relief Act of 2014, which would increase the low-income housing tax credit allocations for each state that include any portion of a federally declared disaster areas in 2012 or 2013. The amount of each state’s increase is proposed as the greater of the amount of $8 multiplied by the state’s disaster-area population or 50 percent of the state housing credit ceiling for 2013. S. 2233 has been referred to the Senate Finance Committee.

Tune in to this afternoon’s Tax Credit Tuesday podcast to learn more about the bill.

Senate Finance Committee Passes Tax Extenders Bill

WASHINGTON – April 3, 2014

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The Senate Finance Committee today passed the Expiring Provisions Improvement Reform and Efficiency (EXPIRE) Act by voice vote. The bill incorporates modifications released today by Chairman Ron Wyden, D-Ore., including extensions of the renewable energy production tax credit (PTC) and of the 4 percent tax credit percentage floor for the low-income housing tax credit (LIHTC).

IRS Newsletter Discusses Assorted LIHTC Topics

WASHINGTON – April 1, 2014

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In LIHC Newsletter #55, the Internal Revenue Service (IRS) discusses foreclosure of low-income housing tax credit (LIHTC) properties, updates to public housing authority (PHA) utility allowances, and the draft Internal Revenue Code (IRC) §42 audit technique guide. The newsletter also clarifies that noncompliance corrected before submitting Form 8823 to the IRS may still be subject to tax consequences, such as credit loss or recapture.

Senate Finance Committee to Consider Tax Extenders

WASHINGTON – April 1, 2014

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The Senate Finance Committee will markup legislation on “tax extenders” on Thursday, April 3. The bill, entitled the Expiring Provisions Improvement Reform and Efficiency (EXPIRE) Act, addresses a number of tax provisions that have expired or will expire at the end of this year. Among other things, the legislation would extend for two years important affordable housing and community development provisions. The committee also released a summary of the bill’s provisions and a cost estimate.

The EXPIRE Act would extend for two years the fixed rate floor for 9 percent low-income housing tax credits (LIHTC), changing the deadline to allocations made before January 1, 2016. The bill would also extend for two years the provision whereby any military basic housing allowance received by an active member of the military is not considered income for purposes of calculating whether an individual qualifies as a low-income tenant for the LIHTC program.

For more information, tune in this afternoon to the Tax Credit Tuesday podcast. Additional details may also become available leading up to the hearing, so stay tuned.

HUD Releases FY 2015 MIPs

WASHINGTON – March 31, 2014

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The U.S. Department of Housing and Urban Development (HUD) today released a notice announcing the mortgage insurance premiums (MIPs) for Federal Housing Administration (FHA) multifamily, healthcare facilities and hospital mortgage insurance programs that have commitments to be issued or reissued in fiscal year (FY) 2015. The FY 2015 MIPs are the same as FY 2014 MIPS, which were published in the Federal Register on September 20, 2013. The upfront MIP amount charged for FHA mortgage insurance will be 50 basis points for affordable and market-rate properties. The FY 2015 MIPs are effective Oct. 1, 2014.

Johnson, Crapo Announce Housing Finance Reform Markup

WASHINGTON – March 28, 2014

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Senate Banking Committee Chairman Tim Johnson, D-S.D., and Ranking Member Mike Crapo, R-Idaho, announced today that the committee is scheduled to mark up their housing finance reform proposal on Tuesday, Apr. 29 at 10 a.m. EDT. Sens. Johnson and Crapo released their legislative discussion draft earlier this month.

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