CONGRESS CHANGES STUDENT ELIGIBILITY RULES FOR LIHTC PROGRAM

Thursday, December 20, 2007 - 7:00AM

Congress this week passed legislation that would change the student eligibility rules for the low-income housing tax credit (LIHTC) program. H.R. 3648, the Mortgage Forgiveness Debt Relief Act of 2007, included a provision that was originally introduced as S. 1241 by Sen. Charles Grassley, R-Iowa. The amendment would amend the Internal Revenue Code (IRC) to allow certain full-time students who are single parents and their children to live in housing units eligible for LIHTC housing, provided that their children are not dependents of another individual (other than a parent of such children). Currently, IRC Section 42(i)(3)(D)(ii) provides that a unit occupied entirely by full-time students would continue to be a qualified low-income unit only if those full-time students were single parents and their children none of which could be claimed as a dependent of another individual or if the full-time students were married and filing a joint tax return. H.R. 3648 is now slated to be sent to the White House for signature by the President.

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