Liz Bramlet Consulting’s Fall Webinar Calendar

Our final webinar for the summer is sold out, but we have two valuable classes planned for this fall.  Register for the courses described below to learn what the IRS expects from an owner who is resyndicating an existing LIHTC development, and how to plan your LIHTC project’s lease-up to maximize the delivery of the credits to your investor.  

Resyndicating an Existing LIHTC Project

Owners are resyndicating older LIHTC projects.  But when they do, what rules apply?  Is there a new credit and compliance period?  What income limits apply, and how much rent may the owner charge for their affordable units?  And what happens with the existing residents?  What does the owner do with a resident who originally qualified for the LIHTC program but is over-income at the time of resyndication?  Do the rules differ for the oldest of LIHTC projects where the original owner never agreed to an extended use period?  Find out the answers to these and other questions by participating in this 2-hour interactive seminar on resyndicating existing LIHTC projects. 

The webinar is a 2-hour discussion of the rules that apply when an owner resyndicates an existing LIHTC project.  Bring your questions about a project you are resyndicating to class. 

Resyndicating an Existing LIHTC Project is an intermediate level course.  It is assumed that anyone registering for this webinar already has a working knowledge of the LIHTC program.   

Tuesday, September 24, 2013 12:00 – 2:00 PM, Eastern Time

Planning the Lease-Up for Your LIHTC Project

Are you responsible for planning the lease-up for an LIHTC project?  Do you know how to strategize your project’s lease-up so it produces the LIHTC as expected and when promised to the investors?  If you answered yes to either question, this class is for you.   Learn how to plan the lease-up for new construction or an acquisition/rehab project.  Develop an understanding of how to apply the rules for the LIHTC program when planning to lease-up a bond-financed property or when you are resyndicating an existing LIHTC community. 

Planning the Lease-Up for Your LIHTC Project is an intermediate level class.  We assume a participant has a working understanding of the LIHTC program.

Tuesday, October 15, 2013 at 12:00 Noon, Eastern Time

Email support@lbctrainingcenter to receive  a copy of our current Course Catalog or to request a proposal for training for your organization.

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More on Preserving the LIHTC Program

We have been discussing the need for everyone to chip in to help preserve the low income housing tax credit (LIHTC) program. On Friday, July 12th the New York Times published an article titled, Two Tax Credits That Work. It is an Op-Ed piece about the LIHTC and new-markets tax credit programs written by Michael Rubinger, the Chief Executive of LISC. In the article he discusses both programs’ contributions to revitalizing communities by attracting private investment that stimulates economic activity, like affordable housing, and the resulting employment opportunities. He does a terrific job of describing how valuable these programs are to our society, and provides an excellent justification for their inclusion in any future tax reform bill passed by Congress.

You can read the article at http://www.nytimes.com/2013/07/13/opinion/two-tax-credits-that-work.html?_r=0.

To register for our webinar, Resyndicating an Existing LIHTC Project, go to http://stores.lbctrainingcenter.com/-strse-61/Resyndicating-an-Existing-LIHTC/Detail.bok.

To review the training we currently have available On-Demand, go to http://stores.lbctrainingcenter.com/-strse-On-dsh-Demand-Training/Categories.bok.

To view our current course calendar, go to http://stores.lbctrainingcenter.com/-strse-Current-Calendar/Categories.bok.

 

Help Preserve the LIHTC Program

Last month I had the pleasure of participating in the National Conference of State Housing Agency (NCSHA) Housing Credit Conference.  I enjoy speaking at this annual event, but to a greater extent, I appreciate the opportunity to hear the news other panelists bring to share with the industry.  At this year’s conference, we learned of the importance of lobbying on behalf of the program at this point in its history.  The industry is worried that if Congress gets around to addressing tax reform, and particularly if they go the way of increasing tax revenue while lowering tax rates, they will deal away the LIHTC program without concern for how vital it is to the creation and preservation of affordable housing.  They could do this in two ways:

• They could eliminate the program altogether; or
• They could reform the tax code in such a way that those who currently invest in LIHTC properties would no longer need to or be able to apply the credit to their federal tax bills. 

Even if the program survives in some form, with less demand for the credit, credit prices would drop making it more difficult for developers to attract the equity necessary to finance their projects.

Work with industry groups in your area to educate your elected representatives on the success of the LIHTC program.  Make sure they understand that when they are negotiating what will be included in any tax bill, they do not want to bargain the LIHTC program away.  Help them see that in addition to being an extremely effective housing program, it is also a jobs program and they do not want to be held responsible for its demise. Explain to them how much housing this program has helped to create and preserve in their communities.

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To view our current course calendar, go to http://stores.lbctrainingcenter.com/-strse-Current-Calendar/Categories.bok. 

Send an email to support@lbctrainingcenter.com to request a copy of our current Course Calendar.

IRS Policy May Impact Credit Delivery

During last week’s NCSHA conference in San Francisco, Grace Robertson and Paul Handleman of the IRS addressed the issue of residents moving around a development during its rehabilitation.  This resident relocation activity often occurs during the first year of the credit period, and we need to understand how that movement impacts credit delivery during that critical year.  How a resident’s relocation affects credit delivery depends on whether they move between two units included in the same project, or to a unit in a different project.  And remember that an owner defines their project when answering the question on Line 8b of a building’s 8609 form.

On Line 8b, the IRS asks if the owner is operating the building represented by the form as part of a multiple building project.  

• If the owner says no, the building is its own project, and any move a resident makes to a different building is also to a different project, and covered by the LIHTC vacant unit rule.
• If the owner answers yes, they attach a list of the other buildings and BIN numbers they are including in the same project.  If a resident moves to a building the owner included in the same project, it is a transfer and covered by the LIHTC transfer rule.

When a resident moves to a different project, even if that project is the building next door, they must qualify again for the LIHTC program.  They are considered to be a new resident in their new building/project, so before they occupy their new unit, the household must qualify again under the applicable income limit and demonstrate compliance with the student rule.  Because they are moving to a different project, their old unit maintains the status of its most recent resident, and continues to produce its credit under the vacant unit rule.

When a resident moves within the same project, they take their tenant income certification with them to their new unit.  They cannot produce a credit in two units at the same time within the same project, but as they stop producing a credit in their first unit, they start producing a credit in their second unit.    

Understandably, the IRS is concerned about owners manipulating the rules in order to use one resident to qualify more than one unit.  It is so important that the IRS has taken this stance.  Their efforts to maintain the integrity of the program have contributed to its strength and its success.  Paul and Grace said that as a matter of policy, the IRS takes a dim view of an owner moving a resident between buildings in the same development, but not in the same project per Line 8b of their 8609 forms, so that resident can qualify two units. 

I am very sensitive to IRS concerns, but I am confused as how to apply this policy.  As the rules are currently written, a move between two projects, whether they are located across the parking lot from each other or across town, is covered by the vacant unit rule.  It could be that the IRS will issue a revised vacant unit rule addressing their concern that an owner not include two buildings in different projects so they can use one resident to initiate the credit stream for two units located in different “projects” but in the same development.  In the interim, please consult your tax council on this very important issue. 

Note: IRS rules and policies regarding the impact of resident relocation on credit delivery affects projects being refinanced and brought into the LIHTC program for the first time, as well as those going through resyndication.

To sign up for our free list service, simply click on LIST SERVICE.

To view our current course calendar, go to http://stores.lbctrainingcenter.com/-strse-Current-Calendar/Categories.bok. 

Send an email to support@lbctrainingcenter.com to request a copy of our current Course Calendar.

Income Limits for Acquisition/Rehab LIHTC Projects

Income limits continue to be a topic of lively discussion at national conferences.  Who knew that a topic that sounds as simple as a project’s income limits could become so complex, but that is what happened under the Housing and Economic Recovery Act (HERA) of 2008.   One issue I want to clarify for my readers is how to know which income limits apply to acquisition/rehab LIHTC projects.

I have said that for ac/rehab projects, the applicable income limit is driven by the placed in service date for the acquisition credits which is the date of acquisition.  (The date of acquisition is the date on which the ownership entity that will benefit from the credits acquires the project.)  I want to add a caveat to that statement.  As discussed at the NCSHA conference last week, for an acquisition/rehab project, the income limits the owner must use are those in effect at the latter of the date of acquisition, or the date on which the owner begins to rely on the limits to qualify households for the program or to calculate maximum allowable rent, including determining the gross rent floor.

For most owners, applying this “latter of” test results in them being able to use the income limits in effect at acquisition.  An owner typically begins to qualify their existing residents the year they purchase a project, and/or they use those income limits to calculate their gross rent floor. 

Learn why you want to establish your gross rent floor as soon as possible by participating in next Tuesday’s webinar, Income Limits and Rents in the LIHTC and Tax Exempt Bond Programs.  You can read about and register for this interactive course at http://stores.lbctrainingcenter.com/-strse-7/Income-Limits-and-Rents/Detail.bok. 

To sign up for our free list service, simply click on LIST SERVICE.

To view our current course calendar, go to http://stores.lbctrainingcenter.com/-strse-Current-Calendar/Categories.bok. 

Send an email to support@lbctrainingcenter.com to request a copy of our current Course Calendar.

June LIHTC Webinar Sold Out

Our June webinar, Managing a Mixed Income LIHTC Project has sold out.  You can still register for our webinars planned for July and August:

• Income Limits and Rents in LIHTC and Bond Financed Projects, schedule for Tuesday, July 9, 2013; and
• Projects VS Building Rules in the LIHTC Program, scheduled for Tuesday, August 13, 2013.

You can review all the training on our current calendar at http://stores.lbctrainingcenter.com/-strse-Current-Calendar/Categories.bok.

Sign up for our free list service by sending an email to housingnews@aweber.com.

Are you interested in receiving a proposal to receive training for your organization?  Send an email to Daisy Snow at support@lbctrainingcenter.com.

Planning Resident Relocation Activity to Maximize Credit Delivery Available On-Demand

Were you unable to participate in our recent webinar, Planning Resident Relocation Activity to Maximize Credit Delivery?  You can still take this training by registering for it On-Demand.  See all of our webinars now available On-Demand at http://stores.lbctrainingcenter.com/-strse-On-dsh-Demand-Training/Categories.bok.

View all of the classes on our current calendar at www.lbctrainingcenter.com and click on Current Calendar.

Would you like a proposal to receive training for your organization?  If yes send an email to Daisy Snow at support@lbctrainingcenter.com.

Sign up for our free list service by sending an email to housingnews@aweber.com.

 

Planning Resident Relocation Activity to Maximize Credit Delivery

Are you responsible for planning the resident relocation activities necessary to implement the rehabilitation activities at an LIHTC project?   Do you need to know how to track your residents’ relocation activities and their impact on your ability to meet your credit delivery schedule?   If you answered yes to either of these questions, Planning Resident Relocation to Maximize Credit Delivery is for you.  Many acquisition/rehab projects have residents in place that must be relocated during the rehabilitation phase.  But you don’t want to relocate the residents in a hap hazard manner.  You want to develop a relocation plan that coordinates with the construction schedule and enables you to deliver the credit stream on time to your LIHTC investors. 

Planning Resident Relocation to Maximize Credit Delivery is an advanced level class.  It is assumed a participant has a strong understanding of the workings of the LIHTC program.  See its long description to read the full agenda at http://stores.lbctrainingcenter.com/-strse-58/Planning-Resident-Relocation-to/Detail.bok. 

Tuesday, May 14, 2013 at 12:00 Noon Eastern Time

Review all the courses on our Spring 2013 training calendar by going to http://stores.lbctrainingcenter.com/-strse-Current-Calendar/Categories.bok.

Send an email to support@lbctrainingcenter.com to request our current Course Catalog  or to discuss a proposal for us to provide training for your organization.

Sign up for our free list service by sending an email to housingnews@aweber.com.

Send questions you would like answered on this Blog to liz@lizbramletconsulting.com.

Question on LIHTC Income Limits

A reader writes to ask about his LIHTC income limits.  He plans to place his rehab credits into service in June 2013.  The date of acquisition was July 2012, and the county’s 2013 income limits are less than the 2012 numbers.  He is concerned that property management is still using the 2012 income limits to qualify applicants for his LIHTC units.  He asked me to confirm that he should now be using the 2013 income  limits to screen households for his low income units. 

Fortunately, this developer’s property manager knows her job.  The acquisition credits went into service at acquisition, something that occurred prior to HUD issuing the 2013 income limits.  His project was classified as “new” in 2012, and then became “existing” when HUD issued the 2013 income limits on December 4, 2012.  Because his project was existing at the issuance of the new year’s income limits, he may continue to use his 2012 income limits if they exceed their 2012 numbers.  He should be pleased to have such a knowledgeable property manager.

Participate in our webinar, Income Limits and Rents in the LIHTC and Tax-Exempt Bond Programs on Tuesday, July 9th by registering at http://stores.lbctrainingcenter.com/-strse-7/Income-Limits-and-Rents/Detail.bok.

Review all the courses on our Spring 2013 training calendar by going to http://stores.lbctrainingcenter.com/-strse-Current-Calendar/Categories.bok.

Send an email to support@lbctrainingcenter.com to request our current Course Catalog  or to discuss a proposal for us to provide training for your organization.

Sign up for our free list service by sending an email to housingnews@aweber.com.

Send questions you would like

Who Tells Me The Price of My LIHTC

A reader wrote to ask if there is a regulation that governs how much investors contribute to a project per tax credit dollar from which they will benefit.  This is a common and understandable question coming from practitioners accustomed to working in highly regulated housing programs.  It seems there is a rule for everything, so why would there not be one that governs credit pricing.

This is an area where the low income housing tax credit (LIHTC) program differs from others used to support the creation and preservation of affordable housing.  The price an investor contributes to a project per credit dollar is governed by the market.  The price rises and falls based on the law of supply and demand.  And it can be a very localized market.  The price will be higher in cities and counties with a strong demand for affordable housing where investors are more assured of the success of the project.  If you are new to the industry, you can learn about the LIHTC market in your area from your state housing finance agency, from syndicators investing in the market, and by studying recently negotiated and completed deals in your community.

Review all the courses on our Spring 2013 training calendar by going to http://stores.lbctrainingcenter.com/-strse-Current-Calendar/Categories.bok.

Send an email to support@lbctrainingcenter.com to request our current Course Catalog.