tax credit ng the housi COMPLIANCE CONNECTION Second Quarter 2005 a quarterly publication of mississippi home corporation VP Notes THE AOC REPORT: Some Last Minute Questions by: Deborah Heard Accountant. Recently, on May 12, 2005, the Corporation Q: If my development was in carryover status Summer is fast held a training session on the proper preparation during the past year, what forms, if any, approaching, of the Annual Owner Certification (AOC) Report, should be completed for the submission of which means it a report required by the IRS of all owners of the AOC Report? is time for sun Housing Tax Credit (HTC) developments. A: If your development was in Carryover Status b a t h i n g , During the training session, questions arose during the past year, then the only form you will Robert D. Collier, swimming, concerning the forms that should be included in need to submit is the OCCPC form (pages 1 and Vice President Multifamily Programs vacations, this report and the correct way to assemble the 2 only). Remember, you still must have the barbeque parties, and submission. This article will attempt to share OCCPC notarized! oh yeah, the second with you some of the more common questions: issue of the Compliance Connection. Q: What information is included on the Q: Who is responsible for completing and Development Physical Condition Report. Since the publication of the last issue, signing these reports? A: The Development Physical Condition Report, three compliance briefings have been A: The owner and/or his/her registered agent is which is still a relatively new addition to the AOC conducted by staff, two on “HTC responsible for completing and signing the AOC Report, collects information on the physical Fundamentals, ” held on March 10 and Report certifying that all information contained condition of damages sustained to the June 9th and one on “Leasing a Tax therein is true and correct. The Registered development during the past year, particularly Credit Unit” on April 7, 2005. As you Agent must be listed in the Partnership damages that take a unit/building out of service. can see, we’re busy educating! Agreement. If there are none, then you would put “N/A” In this issue, the second of a two where it calls for a description of the damages. part series on Fair Housing compliance Q: Which of the forms in the AOC Report Remember, this form must also be notarized. and enforcement is featured. See must be notarized? inside for what not to do at your tax A: The Owner’s Certification of Continued Q: When does an owner submit a copy of the credit site. Also, since our last Program Compliance (OCCPC) and 8609’s that were sent to the IRS? publication, we’ve added a new feature Development Physical Condition (DPC) Reports A: The 8609 forms, issued to you from our to the compliance website ~ the ability are the only two forms that must be notarized. Allocation Department, should be submitted the to calculate the maximum allowable The Operating Statement should be notarized IF first year you are required to send in an AOC income and rent limit for tax credit it is NOT generated by a Certified Public Report. In years 2-10, copies of the Schedule households via our online calculator. To utilize this feature, visit our website at continued on page 7 www.mshomecorp.com. It’s just another way in which we’re trying to In this issue... assist you with compliance. We hope State Audits, 8823s & What Really Matters to the IRS ... .................Page 2 you enjoy it!! Compliance Updates/Upcoming Events..................... ... .................Page 2 Remember the July 1st deadline to Crossword Puzzle.................... ... ............................... ... .................Page 3 Fair Housing Compliance and Enforcement - Part II . ... .................Page 4 submit your Annual Owner Certification Absent Family Members.......... ... ............................... ... .................Page 5 Report is right around the corner. Let’s HTC in the News...................... ... ............................... ... .................Page 5 get those Reports in on time!!! Straight from the IRS............... ... ............................... ... .................Page 6 Compliance Spot Light............ ... ............................... ... .................Page 6 The Days of Compliance ......... ... ............................... ... .................Page 7 Compliance Q & A ................... ... ............................... ... .................page 8 Ensuring Compliance through Education and Training Mississippi Home Corporation, PO Box 23369, Jackson, Mississippi, 39225-3369, 601.718.4642, www.mshomecorp.com page 2 Compliance State Audits, 8823s, & What Updates The Compliance Division welcomes the Really Matters to the IRS? participation of March(HTC) the following Housing Tax Credit developments to the The following is a reprint of an article taken from TheoPRO’s Weekly Online Compliance Advisor with the consent of Ruth severe. Under the surface, though, the state 11-12, 2004 Quarterly Briefing may be commenting on and alerting the property Mississippi housing-market: Theobald of TheoPROs Compliance & Consulting, Inc. owner/manager to issues that could suggest the Housing Tax Credit Fundamentals by: Ruth Theobald, President deterioration of the housing. Mississippi Home Corporation Sara Newsome, Vice-President If it were our property, we would simply take Offices Park Apts, Ph II Bay what the state reported and tend to correction. In Bay St. Louis Jackson, Miss - 64 units Question: this case, we would notify the household that the We have recently been audited by the state and state has found their unit to be untidy and 15 - 17, 2004 - 2004 Mississippi Kirby Road Apts II they have written our property up for the most nit- suggest ways that they can remedy the situation. Robinsonville - 62 units SAHMA Conference picky things. Housekeeping, for instance, over This should not be handled in a derogatory Housing Tax Credit Compliance which we have no control. In another instance, manner, but with respect and courtesy. Highland Park Apts the annual report we sent to them had a different Regarding the differences in facts reported Sessions Jackson - 152 units Speakers: Robert Collier/Karen rent indicated than the one that the file indicated. to the state versus what they find in the file, we The rent was well below the maximum limit so would suggest the same approach. While it is Georgetown Park Apts I Chandler why would they write us up? Will they issue true that if the family’s rent is below the maximum Miss Biloxi,Starkville - 98 units 8823s on this? What will the IRS do if it is rent there is no violation as far as an 8823 “Low reported? Income Housing Credit Agencies Report of Non- 25, 2004 - Quarterly Briefing ChapelRidge of Richland Compliance” to the IRS, certainly the state has Richland 184 units Annual Owner- Certification (AOC) Answer: the right to call this discrepancy to our attention Prep Class Physical property inspections, which have and to ask us to explain it. Again, simply Fox Ridge Estates II Mississippi Home Corporation been required for Section 42 since 2001, create providing them with proof of what the true rent is Tunica - 32 units some interesting questions, such as the ones according to the lease and any other supporting Offices Jackson, Miss Apts II you have posed here. When is it truly non- documentation should suffice in remedying the Shady Lane compliance and when is it not? situation. Tunica - 96 units Each state sets the standard by which it In some cases, the state will not report all of April audits for physical condition and they have the their findings to the IRS on Form 8823 unless it is 22, 2004 - Quarterly Briefing choice of using local building codes or Uniform in fact a violation of federal regulations. In other Upcoming Housing Tax Credit Compliance for the Advanced Physical Condition Standards (UPCS). In addition to this they are supposed to audit for cases, they may report this on an 8823, but if it has been corrected, that result will also be stated Events Guest Speaker: Liz Bramlet, Quadel Consulting compliance with fair housing construction standards and a myriad of other details. on the report. Responding to their findings whether or not they carry the import of an 8823 Under the surface of these requirements violation is simply a good practice and will Location: TBA JUNE lies the purpose for which these physical enhance your relationship with the state. Technical Assistance Available inspections were created in the first place: While we realize that it might feel absurd, Upon Request keeping low income tax credit units in a condition you could always thank the state for bringing May that provides decent, safe, and sanitary housing. these matters to your attention. Overall it will JULY 2004 - Quarterly Briefing 5, We agree that on the surface, being written help you maintain your tax credit property to a 1 2005 AOC Certification Annual Owner Report due (AOC) up for a family’s poor housekeeping seems higher standard! - Good luck! Prep Class (Encore Presentation) Mississippi Home Corporation AUGUST Offices Assistance Available Technical Upon Request Jackson, Miss Things are getting easier In the world of HTC where things seem to Tip Us continually get more and more complicated, isn’t it nice to find something designed to simply make If you are currently a participant in the your life easier. MHC’s new Compliance Mississippi HTC program and would like Calculator is such an item. to share a compliance success tip, please Calculations of maximum allowable income and let us know. We may feature your tip in rent limits will now be a breeze with MHC’s online calculator. To add a little simplicity to your life, an upcoming issue. Email tips to visit the compliance section of our website at firstname.lastname@example.org. www.mshomecorp.com page 3 Compliance Crossword 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Across 1. Antique Car 3. Daffiney or Teri 7. Discharge resident 18 8. Pre-Compliance 10. Out-of-date 19 11. Approved 14. Written on paper 20 17. 20% requirement 18. Student Exception (Abbr.) 20. Grant to stop verifications Down 1. Future income 2. Program benefit (2 words) 4. Unknown family member 5. Documentation Site 6. Verification method 9. Promise to State (abbr.) 12. AOC month 13. Proved 15. Never Qualified TC Unit 16. Not market, not low-income 19. Rent Mate (abbr.) 4.UNBORNCHILD 5. FILE 6.ORAL 9.LURA12.JULY 13.VERIFIED 15.EMPTY 16. STAFF 19.UA 14.DOCUMENTED 17. TIPS 18. TANF 20.WAIVER DOWN - 1.ANTICIPATED 2.TAXCREDIT ACROSS - 1.ASSET 3.AUDITOR 7.EVICT 8.ALLOCATION 10.EXPIRED 11.ELIGIBLE page 4 Fair Housing Compliance & Compliance Enforcement - Part II Photo Poll by: Robert D. Collier year. These totals do not include discrimination This is the second of a two-part series on based on disability and familial status (two of the If you could make one wish compliance and enforcement of the Fair Housing most common types of discrimination), religion or for the tax credit program, Act. In the last issue of the Compliance sex. Additionally, there is no comparable data for Connection, Part I dealt with the type of housing persons with disabilities, yet this group what would it be? covered under the Act, what is prohibited in the continuously files the highest number of sale and rental of housing, protections for people complaints with HUD each year. with disabilities and requirements for new buildings with four or more units built after March Rental Market Discrimination To have the ability to 13, 1991. In this issue, I will focus on how fair The majority of complaints in the rental enter tenant data online housing violations/noncompliance are reported market are filed against apartment owners and at the end of each month. and enforced by state and federal agencies and managers for discriminating on the basis of race Francine Spann the significant consequences that can result from (29% in 2003), disability (27% in 2003), family Site Manager failure to comply. status (13% in 2003) and national origin. The Morrow Realty The Fair HousingAct (theAct), which was first private fair housing movement reported 12,091 passed in 1968 shortly after the assassination of complaints of housing discrimination in the rental Dr. Martin Luther King, prohibits discrimination market. The discrimination may take the form of based on race, color, religion, sex, familial status Not to be tested at every landlords denying that units are available, and national origin. It is enforced administratively training. refusing to make reasonable accommodation for by the U.S. Department of Housing and Urban Scott Hendrix a person with a disability, quoting higher rents or Development (HUD). People who believe that security deposits, segregating African General Manager they have been harmed by a violation of the Act Americans, Latinos, Asian Americans, or families Hughes Management may file administrative complaints with HUD, and with children in one part of building or complex, HUD conducts an impartial investigation of the restricting access to rental property amenities claims. such as swimming pools or community rooms, or The Act also authorizes federal lawsuits by initiating eviction proceedings against white To eliminate the the U.S. Department of Justice (DOJ) and private tenants who have visitors who are African recertification process for lawsuits that can be filed in federal or state courts American, Latino orAsianAmerican. the elderly. by individuals. Many state and local fair housing Ruth Martin enforcement agencies also have authority to Federal Enforcement Owner/ Manager investigate violations and bring enforcement New Albany Elderly actions. United States v. JDL Management Co. (N.D. Ill.) Where violations of the law are established, In this case, the United States filed a complaint claiming that the architect and developer engaged in a pattern or practice of remedies under the Act may include the award of discrimination against persons with disabilities. The United States compensatory damages to victims of settled this case with a consent decree. Pursuant to the decree, $92,000 will be used to retrofit non-compliant units at Acorn Glen over compliance with the Act. The MOU spells out the discrimination, sometimes numbering in the a 10-year period. The remaining money will go towards retrofitting the steps that would be taken and the responsibilities public use and common areas ofAcorn Glen. hundreds of thousands of dollars, orders for of housing credit agencies when instances of fair comprehensive corrective action, and awards of housing have been identified. Specifically, the punitive damages to victims or civil penalties to In 2003, private fair housing organizations MOU states that the DOJ and HUD will provide the government. In design and construction with membership in NFHA investigated more notice to the IRS and state housing finance cases, remedies may also require retrofitting than 17,000 complaints of housing agencies of any enforcement actions brought housing that has already been constructed to discrimination. Approximately 27 percent of under the Fair Housing Act involving tax credit make it comply with the Act’s design and those complaints involved race discrimination. construction requirements. There were 2,745 complaints filed with HUD’s United States v. City of Johnstown, Pa. (W.D. Pa.) Office of Fair Housing and Equal Opportunity. Of On June 16, 2004, the Court entered a consent order in United States Fair Housing Discrimination – National those complaints, 32 percent involved race v. City of Johnstown (W.D. Pa.). The complaint alleged the City denied the American Legion's application for a conditional use permit to Trends discrimination in housing. Despite these operate a transitional housing facility for homeless veterans at an old school building because the prospective occupants were disabled. According to the National Fair Housing statistics, last year HUD records show the law There was strong neighborhood opposition to the proposed facility. Alliance (NFHA), at least 3.7 million fair housing was violated in only four cases; ten when adding The consent order enjoins the city from discriminating on the basis of disability in housing. In addition, the city will pay $82,500 in violations still occur annually more than 35 years cases filed by the DOJ. damages to the American Legion and a $15,000 civil penalty to the United States. Certain city employees will also receive training on the after the passage of the Act. Recent research provisions of the Fair HousingAct. has documented significant levels of Fair Housing Discrimination – Tax Credit The case was originally referred to the Division by the Department of VeteransAffairs. discrimination against African Americans, Housing Latinos, Native Americans, Asian Americans and Since August 2000, the issue of fair housing, particularly in tax credit developments, has development owners. The IRS, in turn, will notify Pacific Islanders. A recent study commissioned garnered increased attention nationally when the involved development owners that a finding of by the NFHA found that race discrimination IRS, DOJ, and HUD entered into a Memorandum discrimination could result in the loss of tax against African Americans in the housing market of Understanding (MOU) to promote enhanced credits. occur more than an estimated 1.7 million times a continued on page 7 page 5 A temporarily absent family member (TAFM) three categories: separation, incarceration and Absent Family generally tend to be spouses, adult students living away from home, children temporarily military duty. Below is a summary of how we have answered the questions posed. placed in foster care, adults away for active Members military duty, and/or family members currently in a hospital or rehabilitation center. When dealing Separation Whether an absent spouse is temporarily or with a TAFM or making a decision as to the permanently absent may have a big impact on the occupancy status of a TAFM, one should take household size and consequently, the applicable by: Teri Nguyen great care. One “slip-up” could cost you a lot in income limit. To avoid incorrect inclusions or terms of noncompliance. The key to handling omissions have the applicant/resident answer Knowing the members of your immediate these cases is asking the right questions. Here, the “three-question quiz” and acquire an affidavit family is generally a cinch. You could probably we try to offer a “three-question quiz” to ask from the applicant/resident as to the rattle off all the names of your family in the households with a TAFM that should assist you in circumstances regarding the separation. In an amount of time it takes to say “Bless you.” making the best decision upfront: omission case, it is strongly suggested that However, deciding who is part of your household is another matter entirely. Often, in the tax credit management acquire secondhand program, the terms family and household are 1) Is there a possibility that the absent family documentation, relating to the separation (i.e. used interchangeably in error. The Housing Tax member may return to the household? documentation of domestic violence, restraining Credit program is concerned about the members 2) If the absent family member was not order, legal separation agreement, letter from of your household, but does not dictate who may obliged elsewhere (e.g., school, military attorney, etc.), to support the affidavit and the or may not be a part of your household. duty, etc.) would she/he be at home? occupancy decision. As we should all know by now, household 3) Can you reasonably determine a date of size may be THE most important factor in return? Incarceration determining tax credit eligibility. It determines the Unfortunately, people make mistakes - big applicable income limit for the household, which If you have answered “yes” to any of these legal mistakes. However, those family members is a pass or fail test. Thus, knowing who is questions, you should count the TAFM as part of are still a part of your family. The question is “are actually part of the household is vital to the household. If you have answered “no” to all they a part of your household?” Should you add compliance. One problem in making this these questions, then the family member should them? Unfortunately, the HUD Handbook does determination is knowing which household be considered permanently absent, and thus, not specifically address this issue. Thus, in an member is to be counted. The problem does not does not have to be counted. However, in the effort to make a decision based on your rest with the obvious members (i.e. those latter scenario if the TAFM is a spouse, the head knowledge of the full situation, have the tenant physically residing in the unit, although some of of the household may choose at his/her discretion answer the “three-question quiz.” Once given the these individuals may be excludable) but with the to include or exclude the member. circumstances, use your best judgment. Again, not so obvious members - those temporarily Over the past few years, MHC has received a acquiring secondhand verifications, if possible, absent. series of questions regarding how to handle such as a news article noting the sentencing, TAFMs. The questions posed generally fell into would only strengthen your case if the decision continued on page 6 HTC in the News - Utility Allowance by: Robert L. Lee maintenance costs,” added Zipperer. So, what does the IRS need to do to fix this problem? According to an article published in According to a coalition of multifamily organizations in a December Affordable Housing Finance magazine 2004 proposal to the IRS, the IRS must implement policy changes written by John Zipperer, efforts for new addressing problems found in two main, contributing factors: limited utility utility cost adjustments by the IRS were set for allowance sources and the deregulation of utility services. The coalition early 2005. With this, owners of low-income proposed that having more options, such as “allowing the use of a housing tax credit (LIHTC) developments are hoping software model of utility service consumption, a state certified the IRS will adopt policy changes that will allow utility professional engineer, the state housing finance agency, or, for existing allowance estimates to be generated in a manner buildings, the actual utility data based on occupied units in the same consistent or comparable to actual utility consumption. This policy property,” as well as eliminating deregulation whereby allowing utility change, according to Zipperer, will allow for more accurate cash flow charges from multiple sources to be combine into one single bill, would projections and therefore greater feasibility for affordable housing bring utility allowance estimates in line with the average utility cost. developers. Finding a viable solution, one that works for all parties involved, may Currently, IRS regulations require that owners of LIHTC not be an easy task. Proposals, such as the one recapped above, may developments (specifically those who do not furnish utilities such as light, be just the answer for some and only half the answer for others. Just water, gas, etc.) deduct estimated utility costs from the gross rent of think about the several other dozen proposals that may have been household’s occupying low-income units in order to establish the net rent submitted for consideration. Will any of them work? Was there a “catch they will charge these households. According to Zipperer, many owners one, catch all” proposal submitted? Will the problem with utility feel they are overestimating utility cost due to out-dated methods for allowance estimates be put to rest once and for all? The answer to retrieving utility information and estimates based on old properties with these questions is ~ no one currently knows. But one thing is certain; less efficient construction and appliances. “Higher utility costs translate something must be done and soon. Who knows? A viable solution may into actual reduced cash flows the net rents, leaving the owner with less be lying restlessly on the desks of IRS officials awaiting final approval! money available to service the mortgage and cover operating and page 6 Compliance SpotLight Straight from the Southwind Apartments IRS... Durant, MS Mississippi Home Corporation (MHC) recognizes Southwind The Internal Revenue Service (IRS) published Apartments for its outstanding compliance monitoring practices. Revenue Procedures 2005-30, which provides Southwind Apartments met the challenge of the Housing Tax guidance regarding an extension of time for private activity bond issuing authorities that fail to make a Credit (HTC) program (affordable units with restricted rents) as timely carry forward election. The relief provided reflected in the latest compliance monitoring review performed by under Rev. Proc. 2005-30 is in lieu of the letter ruling procedure that is used to request an extension of time our agency. NO FINDINGS! WOW, what a way to GO! Keep up under Internal Revenue Code § 301.9100-3. the good work!! Representative William Jefferson of Louisiana Southwind Apartments offers 31 affordable housing units (24 (D) has proposed legislation in Congress that would double the current low-income housing tax credit of one-bedrooms and 7 two-bedroom) spread throughout four $1.85 per capita to $3.70 in FY 2006. Additionally, residential buildings. Southwind Apartments reserves 100% of its Jefferson joined Representatives Jim Ramstad of Minnesota (R) and Ben Cardin of Maryland (D), in units for families with income and rents at or below 60 percent of introducing legislation they championed in the last the area median income. Congress to reform the "exit tax" imposed on Southwind Apartments is currently owned by Southwind developers of affordable housing. The proposed legislation would waive the exit tax for owners who Housing L.P., Paul A. Carpenter, and is under the management of sell their properties to buyers who agree to keep the Carpenter Management. Deana Gray, site manager of 7 years, is properties affordable for no less than 30 years. The IRS recently invited comments on Treasury responsible for the day-to-day operations of the development. Decision 8801, the arbitrage restrictions on tax- According to Gray, “reading compliance manuals & updates and exempt bonds issued by state and local governments attending as many MHC compliance training seminars as and rules regarding the use of proceeds of state and local bonds to acquire higher yielding investments possible” has helped me maintain compliance with the tax credit under Section 148 of the Internal Revenue Code. program. There are no changes being made to the regulations at this time. This review is part of a continuing effort to Southwind Apartments has been in operation as a HTC reduce paperwork and respondent burden as development since September of 1993. required by the Paperwork Reduction Act of 1995. Details are available in the Federal Register dated May 13, 2005. Written comments will be accepted. Developments featured have an overall favorable compliance status according to the latest monitoring visit performed by MHC's Compliance Division. Absent Family Members continued from page 5 you made is ever questioned. dependents (i.e. a spouse or children), that overnight delivery, etc.). Third, check to see if a person and his/her income must be counted. present household member has the power of Military Duty When faced with this scenario, in addition to attorney to sign on behalf of the TAFM. TAFMs of this type can be quite confusing, asking the “three-question quiz,” you must also Life is constantly changing as will especially if the person is not related to the head consider any dependents left in your household. households. That is part of life. Make sure you of household but to another household member. Now that you have made your decisions on are aware of these changes and fully document What do I mean? Well, according to the HUD the occupancy status of TAFMs, I am sure you are the circumstances. If you do not address the handbook 4350.3 Rev 1, in determining the going to ask “How do I document this and how do I questions now, your auditor may ask you later. occupancy status of military personnel away on get their signatures if they are considered adult The best thing to do is to document and attempt to active duty, you must count members that are the TAFMs?” First, we strongly suggest you have a settle the questions before they arise OR head, co-head or spouse OR if they have left a note to the file regarding the circumstances of the WORSE before a certification error is made that spouse or dependent children. Thus, if a person absence. Second, in acquiring the signatures of could jeopardize your tax credits. away on active military duty has left any TAFMs, consider an alternative method of obtaining information (via fax, certified mail, page 7 AOC Report continued from page 1 A’s you receive each credit year along with the IRS Form 8586 are the only forms required. attendees asked some very important and necessary questions about the proper completion compliance tip Q: When a household transfers from one unit of the AOC Report. The questions above are important to the site manager, as well as the of the quarter to another unit in the building, what move-in owner and the management company. This date should be listed on the rent roll report and report provides to the Corporation and the Internal what is the next certification of the unit? Revenue Service (IRS) a “snapshot” of how the “At recertification, always re-verify A: This is generally called an Intra-Building development has complied with the program rules income from a previously Transfer. The move-in date that should be listed and regulations during the past year. Submitting documented source even if the is the move-in date into the “new” unit. It should an incomplete and/or inaccurate report not be the old move-in date or the development constitutes noncompliance reportable to the IRS. tenant notes income is no longer move-in date. In a transfer such as this, generally, In saying that, please take note that information being received from that source. the household would continue on its recertification given in the Report should be as accurate as Doing so will allow you to properly schedule from the previous unit. In most cases possible. The AOC Report may be used as a calculate the portion of the rent due this will be the anniversary date of the “old” unit’ s reference for an audit by the Corporation and/or from tenant.”* move-in date. the IRS. Any discrepancy in the information reviewed on-site and what was given in the AOC For example, the Roberts moved into Unit #1 Report may lead to noncompliance. *Particularly beneficial when tenant on June 13, 2002. On February 5, 2003, they Remember, your AOC Report is due by July 1 rent is subsidized by HUD or RHS.” transferred to Unit # 2 (also in the same building). at 5:00 pm. We hope that by sharing these The tenant’s move-out date for Unit #1 is February questions (and our answers), we can help you Sylvester Pomerlee 5, 2003. The move-in date for Unit #2 is also alleviate some common errors thus allowing you February 5, 2003. The recertification, if done on to submit a deficiency-free report. Area Manager time, would be June 13, 2003. As you can see from these questions, the Fair Housing continued from page 4 In an effort to more widely educate housing development are available for use by the general Mississippi, reports all violations of the Act on IRS credit agencies, owners and other parties about public, as required by federal regulations. The Form 8823 (Report of Noncompliance) under line the Act and federal accessibility guidelines, the regulation further provides that a unit is deemed item 10(d) which states “Owner failed to provide IRS, DOJ and HUD, since the inception of the available for “use by the general public” if it is annual certifications or provided incomplete or MOU, have spoken to various groups and at rented “in a manner consistent with housing policy inaccurate certifications.” In accordance with various events regarding Fair Housing governing nondiscrimination, as evidenced by Section 42 of the IRC and the Income Tax compliance, its relationship to tax credit rules or regulations of HUD.” Regulations, a report of noncompliance indicating developments and the responsibilities of various In 2001, the AOC Report was amended to an owner of a low-income housing tax credit parties. require owners to certify that no finding of development unlawfully discriminated against a Under Internal Revenue Service Reg. 1.42-9 discrimination under the Act has occurred for the current or prospective tenant(s) could result in the (general public use requirement), the specific tax development. This would include reporting loss of tax credits on this development. regulation requiring compliance with the Act, an violations such as: For more information on Fair Housing owner of a low-income housing tax credit ¨An adverse final decision by HUD - An adverse compliance, contact the Atlanta Regional Office of development is required to annually certify to the final decision by a substantially equivalent state or FHEO at 1.800.440.8091. To report housing housing credit agency (through its Annual Owner local fair housing agency, and/or discrimination, contact the Housing Certification (AOC) Report, a report summarizing ¨An adverse judgment from a Federal court Discrimination Hotline at 1.800.669.9777. an owner ’s compliance with program The Mississippi Home Corporation, the requirements,) that all low-income units in the housing credit allocating agency for the State of The Days of Compliance ...if this is a please press 1 to speak with Ann, please 2 to speak Thank you rent related question please press with Bob, please press 3 to speak with Carol, press 4 to for calling Shady Acres 6, if you’d like to leave a message please press speak with Dan, please press 5 to ... Apartments, you have reached the automated answering service. If you know the extension of 7, for more options please press 8, if you would your party please dial it now, if not, please hold like to speak with a real live person please press for a list of 9 for an extension list dialing options... Jackson, MS 38225-3369 PO Box 23369 CONNECTION COMPLIANCE the housi ng tax credit COMPLIANCE Q: I have received a Social Security verification for a child in & MONITORING STAFF one of my tax credit units. However, I have noticed that the verification notes, “Jane Doe for Sarah Doe.” Sarah is the child. I Robert D. Collier have no idea who Jane Doe is. Should I question the relationship of Vice President Multifamily Programs this person to the child? Karen C. Georgetown Assistant Vice President Compliance Monitoring A: Yes, we strongly suggest you inquire and document the Daffiney House Compliance Officer relationship of Jane Doe. Although it is rare, it may be that Jane is simply a financial guardian of Teri Nguyen Sarah’s benefits. However, leaving the question of who Jane is may give rise to other Compliance Officer compliance questions, such as “Should Jane Doe be considered a household member? Should Deborah Heard her income also be counted?” Thus, it’s always a good idea to document the situation to be Compliance Assistant certain. Rob Stevens Building Inspection Administrator Q: Who should witness a mark of a tenant who is unable to sign his/her name? Robert L. “Derrick” Lee Intern Melody Barnett A: The person witnessing the signature “mark” of a tenant must be a person other than Intern management and/or the owner and of legal age and sound mind to do so. Please contact us at 601.718.4622 if you would like to be removed from the Compliance Connection mailing list. This newsletter is designed to convey Mississippi’s current HTC compliance monitoring policies, procedures, updates and changes AND is not intended to be a legal interpretation of the Internal Revenue Code (IRC).
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