Can Households Drop Section 8 Subsidy to Benefit from Lower Tax Credit Rents?

Question from a Blog Reader "We have a Section 8 property with tax credits. We know that we can collect rent in excess of the tax credit max rents as long as a household is benefiting from rental assistance. We know this is true until subsidy ends, when the tenant rent will have to go down to the tax credit max rent. What happens if the household is to the point where they are getting rental assistance, but their portion of the rent is actually more than it would be if they were under the tax credit limits. Our owner does not want to give them a choice to go off subsidy when this happens. Can we have a policy to not give them an option of the lower tax credit rents until they lose subsidy, a

Quiz 01/22/2019: Income Averaging

Per the Boston Capital Income Averaging State Guide we released yesterday, states are developing a variety of policies to implement the Income Average Test. The below questions, however, focus on the federal rule, as distinct from state approaches. 1. Income Averaging is available to projects that had not ______________ prior to the passage of the new law. A. received a carryover allocation B. had a LURA registered C. had its minimum set-aside elected D. placed in service 2. Section 42 requires that income designations be evenly distributed among bedroom sizes? True or False 3. Income Averaging is available to both properties that are 100% tax credit and those that have market units. True or

Another Handy Gift to our Readers!

In both a recent NAHB HCCP webinar and at the NCSHA Conference in Washington DC last week, I participated in lively Income Averaging discussions. On the HCCP webinar, co-panelist Carol Howard of Boston Capital discussed an amazing document that she and her team have created compiling and summarizing each state's policy on Income Averaging. Many in attendance at these discussions expressed that they would like access to this research. I am grateful that Carol is willing to share it. As a gift to our loyal blog readers, I am posting it here, as well. Enjoy! Download the handout by clicking the picture above, or HERE

Can an Emancipated Minor be a Dependent?

Question from a Blog Reader "We have a husband and wife who are living in a unit with their two children and her brother, who is 16 years old. He is an emancipated minor because of this parent's drug dependency problems. He is a junior in school and is working. Does he qualify as a dependent and for the $480 limit on earned income? It seems that we should treat him as an adult, as he is emancipated, and count all of his earned income." Answer Summary: He should be treated as a dependent. The HUD 4350.3 says, "If an emancipated minor is residing with a family as a member other than the head, spouse, or co-head, the individual would be considered a dependent and his or her income handled in ac

Quiz 01/08/2019: Zero Income Households

1. Which agency will not provide rental assistance for zero income households who do not at least have exempt income. HUD or Rural Development 2. The IRS does not allow zero income households to qualify tax credit units? TRUE or FALSE CLICK HERE for answers to this week's quiz

How Can I Find the Minimum Wage in a State?

Question from a Blog Reader "We are opening properties in three new states. We have a lot of service employees who make tips, and we understand that, by law, these generally must make at least a state's minimum wage between wages and tips. Is there a tool to help us to keep track of minimum wage increases by state?" Answer Summary: Below is provided a link to a government resource to track state minimum wages. Visit THIS Department of Labor website.

2019 IRS Mileage Rate Announced - Important for Ride Share Drivers!

On December 14, 2018, the Internal Revenue Service issued the 2019 standard mileage rates used to calculate the deductible costs of operating an automobile for business or medical purposes. Beginning on Jan. 1, 2019, the standard mileage rates for the use of a car, van, pickup or panel truck will be: 58 cents per mile driven for business use (up 3.5 cents from 2018). 20 cents per mile driven for medical use (up 2 cents from 2018). With the announcement, the IRS also provided a reminder that, Under the Tax Cuts and Jobs Act, taxpayers can no longer claim a miscellaneous itemized deduction for unreimbursed employee travel expenses. These expenses were commonly deducted by property managers wit

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Costello Compliance

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