Property Compliance News Briefs – June 2020

Wednesday, June 3, 2020

Property Compliance Briefs

The U.S. Department of Housing and Urban Development (HUD) issued two mortgagee letters April 10 concerning property owners with Federal Housing Administration (FHA) and HUD loans. Mortgagee Letter 2020-09 provides the protocol to request mortgage forbearance for FHA loans as provided under the Coronavirus Aid, Relief and Economic Security (CARES) Act. That authority is in effect from March 27 through the end of the year, unless the national emergency declaration is terminated before then. Mortgagee Letter 2020-11 provides debt service reserve requirements for HUD 223(f) loans in process due to the impact of COVID-19 on the real estate market. The requirements will remain in effect until HUD determines the real estate markets have stabilized.

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The Internal Revenue Service (IRS) April 8 released Rev. Proc. 2020-23, which allows partnerships to amend 2018 and 2019 tax returns, in some circumstances, in order to benefit from bonus depreciation changes included in the CARES Act. The CARES Act included a technical correction to retroactively allow qualified improvement property to qualify for 100 percent bonus depreciation and make other changes. Owners of low-income housing tax credit properties can benefit from the change and amend their 2018 tax return upon receipt of IRS Form 8609. The amended tax return replaces any prior return, if the taxpayer files an amended return for 2018 by Sept. 30, 2020. To be eligible to file an amended return for 2018 or 2019, the partnership had to have filed the original tax return and furnished K-1s before April 8.

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The Ohio Housing Finance Agency (OHFA) sent a notice May 4 to development owners and managers stating that they should continue to act in accordance with state and federal guidance regarding the COVID-19 pandemic. OHFA encourages owners and managers to suspend all rent increases while the state of emergency is in place. In addition, OHFA has extended the deadline for tenant recertification through June 30.

Journal Category: 
Property Compliance
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