Affordable Housing Connections
December 2021 Newsletter
Annual Owner Certification Due February 15, 2022
January 1, 2021, through December 31, 2021, LIHTC & HOME completed submission package must be uploaded to your secure folder within Egnyte by Tuesday February 15th, 2022, by 5:00 p.m. Documents for submission are located within your secure folder.
*Instructional email sent to Owner's and Management Agent Contact on 12-16-2021*
Required documents located within Egnyte secured folders
This notice date of 12-16-21 is the Bright Line Date for Section 42 LIHTC Projects
Submission Package Requirements
- Owner 2021 CHART Authorization for each project
- Signed HTC12, HTC12(Y15) and HOME program Owner's Certification including any applicable supporting documentation
- PY2021 completed HTC and/or HOME CHART Report
- All completed UA schedules effective during the reporting period
For project with allocated credits, but not yet Placed in Service, use the owner certification form found in the HTC 12 only CHART on tab HTC 12. Complete the top portion of the HTC12 form, check the box indicating “No buildings have been Placed in Service”. Skip all other items and have the owner representative sign and date the form.
CHART PY2021 is to be used for the following two types of projects
- Projects with tax credits issued by a Suballocator for which AHC conducts compliance monitoring.
- Projects with tax credits and HOME issued by a Suballocator for which AHC conducts compliance monitoring.
HTC12 Only CHART PY2021
HTC12 Only CHART PY2021 is to be used by the following types of projects:
- Projects with either a 42m letter or Carryover letter issued prior to 12/31/21 must report with both an HTC12 and an HTC12 Only CHART, whether or not placed in service.
- Projects with tax credits issued by a Suballocator for which AHC conducts compliance monitoring and have no buildings placed in service in 2021.
- Projects with tax credits with at least one building placed in service in 2021 but owner elected to not claim credits in 2021.
Creating HOME-ARP Projects & Activities in IDIS: Fact Sheets Available
HUD Exchange has shared the Creating HOME-ARP Projects and Activities in IDIS Fact Sheet which provides an overview of the three options a Participating Jurisdiction (PJ) may choose from for associating HOME-American Rescue Plan (HOME-ARP) Program activities with an Annual Action Plan (AAP) Project.
This fact sheet is the latest in a series of HOME-ARP Implementation Notice Fact Sheets issued by HUD to support program implementation. Each fact sheet addresses a topic related to the HOME-ARP Implementation Notice CPD-21-10: Requirements for the Use of Funds in the HOME-ARP Program.
To find out more on the HOME-ARP Program, visit he HOME-ARP page on the HUD Exchange.
2022 Mileage Rates Announced
The Internal Revenue Service issued the 2022 Optional Standard Mileage Rates on December 17, 2021 to calculate the deductible costs of operating an automobile for business, charitable, medical or moving purposes.
Beginning on Jan. 1, 2022, the standard mileage rates for the use of a car (also vans, pickups or panel trucks) will be:
· 58.5 cents per mile driven for business use, up 2.5 cents from the rate for 2021,
· 18 cents per mile driven for medical, up 2 cents from the rate for 2021 and
· 14 cents per mile driven in service of charitable organizations; the rate is set by statute and remains unchanged from 2021.
When calculating the Medical Expense Deduction for mileage to and from medical treatments or appointments be sure to use the new 2022 mileage rates.
AHC’s 2021 Virtual Housing Conference
With our second virtual conference held on Thursday December 2nd now under our belt, I’d like to take a moment to thank each of presenters who made this year’s event a successful one!
With 125 attendees, 9 speakers, 2 hosts and various guests all attending over a 3 hour virtual session, we are delighted to say AHC has found a successful new format for sharing quality content.
While we always strive to bring new ideas and perspectives to our events, we felt given the current public health pandemic that it was time to reach beyond our local boundaries and bring industry professionals, government leaders and respected academics from across Minnesota into your living rooms and offices. And this is precisely what we achieved.
Affordable Housing Legislation: A peek through the rear-view mirror at 2021 and windshield outlook for 2022.
Residential Rent Stabilization Ordinance
AHC & MHFA: 2021 LIHTC Review & What’s New for 2022
Annual Housing Conference Highlights
On behalf of all of us at AHC, we would like to say a special thank you to Anne Mavity from Minnesota Housing Partnership, keynote speaker, as well as Aubrey Albrecht at Minnesota Multi Housing Association, for joining us as industry professionals.
Shout out to our roundtable of experienced compliance managers who shared their tips for navigating challenges posed by the pandemic: Katie Pfeiffer Dominium, Nicole Munsch Aeon, Shannon Jones Sand Companies and Jenelle Luxem Sherman Associates.
We spent the morning connecting and engaging in topics such as 2021’s accomplishments, housing tax credit (LIHTC) allocating agency updates, lasting impacts of COVID-19 on compliance, legislative insight, and residential rent stabilization ordinances. The afternoon discussions educated the audience on both necessary annual owner certification insights and highlights on AHC’s CHART updates.
Our AHC Education and Leadership Center was pleased to have a guest speaker, Kimberly Ulmer from its new educational program, Leadership in Affordable Housing Certificate, a partnership with Hamline University’s Graduate School of Business. Kimberly shared her positive experiences with learning the history of affordable housing policy, current housing policies, and practical program ideas to confront the affordable housing crisis.
We want to also thank all of you for attending AHC's 11th Annual Housing Conference. We believe that our diverse and dynamic group of leaders, provided in-depth insight and variety that aids in affordable housing understanding and knowledge.
Remember to Update Utility Allowances
Utility allowances should be reviewed and updated at least annually. Regulations require that new utility allowances be used to compute rents that are due 90 days after the effective date of the new allowances. For new buildings, owners/agents are not required to review or implement new utility allowances until a building has achieved 90 percent occupancy for a period of 90 consecutive days or the end of the first year of the credit period, whichever is earlier.
It is the owner’s/agent’s responsibility to contact the appropriate organization to request current utility allowance information. AHC's website has updated allowances published by various housing authorities - click HERE to review the most current allowances.
REMEMBER: Pre-pandemic rules went back into effect October 1
In January, the IRS issued Notice 2021-12, which temporarily postponed a number of deadlines for LIHTC sites. This notice temporarily postponed the income recertification requirement for owners until September 30th. For 18 months, from April 1, 2021, to September 30, 2021, the IRS granted some operational relief to owners and managers due to the COVID-19 pandemic. Specifically, until September 30th, owners were not required to perform income certifications. Now that the extension is over, what considerations may you need to think about to ensure your projects compliance? As recertifications resume, you may discover there have been many changes with your households since the recertification were last conducted before the COVID-19 pandemic began. Income may have changed; household members may have decided to exit the workforce and become full-time students; or household composition have altered.
Income Changes: Income changes are important to track because when a household’s income rises above the tax credit program limits, owners/agents now need to worry about the IRS rule known as “next avail able unit” (NAU) rule.
Household Changes: Additional household members can be problematic because adding the new member’s income to the household’s total can make the household now over-income, triggering the NAU rule.
You might not think that a household can go over income simply by losing one of its members. After all, if a household member passes away, for instance, no income is added to the household’s total. But loosing a member can cause a household’s income to exceed the 140% of AMGI.
Student Status: If you find that some, or all, household members have changed their student status, the household might violate the student rule. It may be the case that some of your household’s have opted to pursue additional schooling or vocational training during the pandemic due to the uncertainties in the labor market.
Should any issue arise while conducting annual income recertifications, always remember you can contact your program manager with inquiries.
Question: When determining household income and assets, what are ‘required minimum distributions’ (RMDs) on retirement funds and do I need to include these withdrawals when determining household income? What age does RMDs take place?
Answer: First, let’s define what a RMD is. A required minimum distribution (RMD) is an IRS-mandated amount of money that you must withdraw from traditional IRAs, or an employer-sponsored retirement account each year by owners and qualified retirement plan participants of retirement age.
What is the age requirement? The IRS requires you to start taking RMDs at 72.*
* The change in the RMD age requirement from 70½ to 72 only applies to individuals who turn 70½ on or after January 1, 2020.
In 2020, the age for withdrawing from retirement accounts changed. The IRS states, you must begin withdrawing from a retirement account by April 1 following the year account holders reach age 72 (prior to 2020, the RMD age had been 70½ years old).
What is the RMD Amount? A calculated amount based on prior year-end account balances and a life expectancy factor. There are many variables here and a tax advisor would best describe actual RMDs.
What account types do RMDs affect?
· Traditional IRAs
· Rollover IRAs
· SIMPLE IRAs
· SEP IRAs
· Most 401(k) and 403(b) plans
Do I include these withdrawals when determining household income?
To answer the second part of your question “do I need to include these withdrawals when determining household income” let’s look at HUD’s Occupancy Handbook 4350.3, specifically Exhibit 5-1: Income inclusions and Exclusions for our answers. Paragraph (4) under Income Inclusions states periodic amounts received from retirement funds are included as household income. Once RMD withdrawals begin, the source account is no longer considered an asset and will remain household income.
A Place to Share our Stories
Checking in With Kathleen
As many of you may remember, Kathleen Proctor was a Senior Program Manager for AHC from 2010 to mid- 2019. Unfortunately, Kathleen had to leave us at AHC. Not because she wanted to, but because she had a battle to fight. The fight of metastatic breast cancer.
But Kathleen is a strong, brave woman who does not let the cancer define her. She currently is living with one of her sons in Lauderdale, cross stitching away, and still making time for family and friends. Although she claims she never has liked change, she knows how to adapt.
So, what does she miss about AHC? Kathleen “misses some of the work but all the people” and the small town feel it had because everyone was looking out for one another. She even misses reviewing files and answering complicated questions from management company staff. Overall, she misses the work groove and the integrity of the staff. Kathleen says she learned a lot from AHC and it will always hold a place in her heart.
Kathleen is doing well and taking one day at a time. She wishes everyone at AHC and in the affordable housing industry the best.
Leadership in Affordable Housing Certificate
Students who have taken the Certificate courses say it provides an insight to the history of affordable housing policies and programs, the economics behind them, and all the issues and crises that leaders face to provide equitable access to housing resources. Not only is the program informational, but it will also leave you realizing that all roads lead back to affordable housing. After completing the work throughout the two eight months courses, you will receive a Certificate from the Hamline University Center for Public Administration and Leadership and eight continuing studies credits. AHC envisions the Certificate as a way to help encourage students to look “up from their professional silo to a broader rooftop view” of the affordable housing field while also broadening existing skills and nurturing leadership potential.
Turning New Skills into a New Job: Personal Stories
Nicole Laumer, who wants to be a city planner, received a Green Infrastructure Fellowship with Green Print Partners. She has no doubt that this class has given her leverage for being accepted into this position. Nicole also will be heading to DePaul in 2022 for her Masters of Sustainable Urban Development. She would also love to give a shout out to Oliver Smith, who was the one who told her about this course.
Abby Alldaffer heard about this course through a connection that posted about it on Linked-In. Taking this course gave her the confidence to view herself in a housing development job because it gave her tangible knowledge that allowed her to be seen as experienced as well as to be treated as a housing expert. As a result, Abby recently was hired by Seward Redesign a project manager where she will be diving head-first into working on a 32-unit affordable housing development as the project lead. She credits the Certificate courses with helping her get the new position.
Do you also want a Certificate?
You, too, could share a story like this a year from now! Registration is open for another offering of the Leadership in Affordable Housing Certificate courses. The Spring Course 1 starts in January.
Certificate registration at: www.hamline.edu/affordable-housing
For further information about financial aid, after registering with Hamline University for course enrollment, contact us at ELC@ahcinc.net
Affordable Housing Connections
We deliver monitoring and consulting services to governmental organizations, property owners and managers; and education to individuals who aspire to leadership in the affordable housing industry. Our aim is to protect the investment of private equity and tax dollars and to ensure continued quality affordable rental housing.