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September's Quizzle Follow up

 

Question One

For all LIHTC communities, a verification to determine student eligibility must be competed at all move-ins and at every recertification or annually when not required to conduct re-certifications.

Answer: True. 8823 Guide 17-2 & Exhibit 17-1 on page 17-5

The Code does not allow tax credits being used for dormitories therefore student status questions must be asked at move-in and verified if necessary. It must also be re-examined annually.

Question Two
 

Sunny Oaks is a Rural Development apartment community with an available 2-bedroom unit. The current very-low income limit is $20,000 and the low-income limit being $27,000. When processing applications from the waiting list, the following applications are available for processing:

  • 10/12/2017; Household A; $25,000
  • 10/20/2017; Household B; $20,000
  • 10/20/2017; Household C; $10,000

Which applicant should have first priority as required in HB-2 3560?

Answer: Applicant #2, Household B

 

Question Three

Sally Jones has submitted an application for herself, her two 3 year-old twins and Tommy, her 19-year old brother who is attending college full time and working a part-time job earning $300 a month as an Uber driver. The manager determines that only $480 of Tommy’s income must be counted and included with Sally’s income of $10,000; resulting in the total annual income to be $10,480.00. Was the manager correct?

Answer: No. Earnings in excess of $480 for each full-time student 18 years or older (excluding the head of household and spouse) may be excluded if the adult student is a dependent of the household. In order to only count $480 for Tommy, he must be both a fulltime student and a dependant of the household.

Question Four

MaryJo moved onto a property on 5/17/2016 and was an income qualified household. At recertification the following year (5/1/2017), MaryJo informed the property manager that she was having her partner, Stanley move in.  Recertification paperwork was completed and the household exceeded the 60% income limit but remained under the 140% limit.  Then in February of 2018 the property began a Re-Syndication of credits and again certified MaryJo and Stanly.  Now, the household exceeded the 140% income limit, however, because MaryJo was a qualified household at move-in (and because this is a 100% tax credit property) they were allowed to be “grandfathered” in.  In June of 2018, MaryJo and Stanly split up and MaryJo vacated the unit.  Once MaryJo moved out, Stanley was treated as a new move-in and his income at that time exceeded the 60% income limit. An investor for the property is afraid the unit is now out of compliance, are they?

Answer:  Break down the situation…Did the household originally income qualify? Yes.  Did the property follow the correct procedure when adding Stanly to the household?  Yes.  Is “grandfathering acceptable? Yes.  Are they out of Compliance? Yes, because once MaryJo, the only original qualifying household member vacated the unit, the household had to be treated as a new move-in and meet current income requirements.  Note:  It is in the property's best interest to re-qualify a household, if possible, when an adult is added to the unit.

 


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