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LIHTC Applications

Written by Cathy Turner, Spectrum Enterprises

 

 

 

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According to the IRS 8823 Audit Guide (page 4-30) an LIHTC certification and supporting documents are not sufficient unless at a minimum the file includes an application, verifications, student status, and a TIC form.  The first step to having a qualified household and a solid certification is a complete application that is current to the certification.  The application is the document completed by all members of the household that the owner uses to gather information to determine eligibility.

In a perfect world, a household would fill out an application, all income and assets would be easily verified and the household would move-in within a short period of time.  However, as we all know there are many circumstances that delay a move-in.  It could be anything from construction delays, a lengthy waiting list, or difficulty gathering income or asset verifications.    No matter what the reason, having an application or a questionnaire that is completed within 120 days of the certification is very important.

During a recent C3P class I attended many of the attendees in the room had high anxiety regarding application dates.  They had properties in the middle of lease up and they were having either existing tenants or new prospective tenants filling out applications.  In one case, there had been repeated construction delays which resulted in applications being over 120 days old.  On more than one occasion, all the applications were tossed in the trash and management started the process all over again.  Throwing the applications away is completely unnecessary.    A better solution would have been to update the out of date application with an Interview Checklist.  The Interview Checklist covers all compliance questions including income, assets, and student status.  Use this form to clarify all aspects of tenant eligibility. So the original application can be over 120 days old as long as you updated within 120 of the certifications.    The Interview Checklist (and our other forms)  is located on our website for your use.

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