Compliance Corner: Changes after move-in

Crystal Banks-Mann By:
Crystal Banks-Mann

Here at Travois we spend a good part of our day responding to questions that come in from our clients to help them maintain compliance for their Low Income Housing Tax Credit (LIHTC) homes. A fair amount of those questions involve adding household members to an already-qualified LIHTC unit.

Below is a prime example of this type of question and my response.

Enjoy this installment of “Compliance Corner!”

Question:

Good Morning, Crystal:

I have a question about updating tenant files. Per our policy I update our tenant files when income decreases or the household ends up with no income. When their income increases, do I still complete an update to their tenant file? It’s in our policy, but I’m just wondering for LIHTC purposes, do we have to? Or do we wait until the annual certification is due?

Thanks,

Serena Jose, residential services counselor
Tohono O’odham Ki:Ki Association
Sells, AZ

 

Answer:

Hi Serena,

Excellent question! It depends! Please see below for the different scenarios:

  • If you have a household that adds a household member within the first six months of occupancy, you would qualify that household like a new move-in. After the first six months of occupancy, you would wait until the next annual certification (recert) is due to add any additional household members and/or income and assets.
  • If you have a household with just an increase in income within the first six months of occupancy, you would verify the new income and make sure to clarify if the income was anticipated at the time of move-in. If it was anticipated at the time of move-in, you would need to update the TIC (tenant income certification) to make sure they would have still qualified. If it was not anticipated at the time of move-in, you would do nothing further. After the first six months of occupancy, we would wait until the annual certification (recert) is due to add the additional income.
  • If a household has a decrease in either household size or income in the first six months of occupancy, you do not need to do anything to remain in compliance with the LIHTC regulations.
  • You may, however, recalculate the household’s rent payment any time you are made aware of a change in the household’s income. We would suggest you refer to your policies regarding the process for completing an update in tenant paid rent.

As always if you have questions about this information or need further assistance, please feel free to call us at 816-994-8970 or email us at assetmanagement@travois.com.

Read past Compliance Corner updates:

 

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