The IRS has sent final regulations relating to the Average Income (AI) test to the U.S. Office of Management & Budget for review.
The final regulations were received by OMB on September 12, 2022. This is the final step before the publication of the regulation by the IRS.
The Treasury Department and IRS first proposed these regulations in October 2020, and parts of the proposed reg faced harsh criticism from the LIHTC industry. It is hoped that the industry recommendations relative to the rule will be incorporated in the final regulation.
OMB has provided no timeframe for their review, but it is hoped that the final regulation will be published shortly, and we can move forward with more certainty on exactly what will be required relative to AI compliance. OMB typically reviews proposed regulations within 60 days, which would mean final publication sometime in November. However, since the Biden Administration has committed to finalizing the proposed rules for the AI set aside as part of its Housing Supply Action Plan, a shorter timeframe is possible.