HUD Releases Income Limits; National Median Income up 12.5% Over 2021, But Calculation for Increase Cap Changes
The U.S. Department of Housing and Urban Development (HUD) today posted income limits to determine eligibility for HUD-assisted programs, as well as eligibility for low-income housing tax credit (LIHTC) and tax-exempt bond properties for fiscal year (FY) 2022. The FY 2022 national median income is $90,000, a 12.5% increase over 2021. The limits took effect April 18. HUD publishes income limits for public housing, Section 8, Section 221(d)(3) and Section 236 properties. HUD also publishes Multifamily Tax Subsidy Projects (MTSP) income limits to determine eligibility for the LIHTC and tax-exempt bond properties.
The most important item of note is that HUD changed how it calculated the cap on increases. Instead of using twice the change in national median income, which would result in a cap of 25% for 2022, HUD used twice the change in the national American Community Survey from 2018 to 2019, resulting in a cap of 11.89%. As a result, the cap is less than half of what was anticipated. Thus, 56% of areas are subject to the cap for 2022, compared to 14% of areas in 2021.
A Notes from Novogradac blog post later today will provide more analysis of the income limits and income limits will be analyzed on an upcoming episode of the Tax Credit Tuesday podcast. Novogradac will host a 2022 HUD Rent and Income Limits and Outlook for 2023-2024 Webinar in May. The Novogradac Rent & Income Limit Calculator® will also be updated soon, with its release announced by a Novogradac Industry alert email.