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A. J. Johnson

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Section 42 Audit Guide- Techniques Used During Audit

September 2, 2015

Audit Guide Chapter 3- Techniques Used During Audit The IRS audit process includes the accumulation of evidence for evaluating the accuracy of a taxpayer’s tax return. Evidence includes taxpayer testimony, books and records, examiner observations, and third party documents.…

The IRS Section 42 Audit Guide: How Tax Returns for LIHTC Properties are Analyzed for Audit Potential

August 23, 2015

How Tax Returns for LIHTC Properties are Analyzed for Audit Potential The IRS §42 Audit Guide provides guidance for analyzing tax returns before contacting taxpayers to determine the specific tax credit issues that should be audited. Prior to any…

HUD Moving Aggressively on Affirmatively Furthering Fair Housing

August 17, 2015

The Department of Housing and Urban Development (HUD) is moving forward aggressively with the departments new “Affirmatively Furthering Fair Housing” campaign to desegregate the country’s primarily white neighborhoods. Rockford, IL will be an early test for HUD’s ability to impose…

Role of the IRS and State Agencies in Implementing the LIHTC Program

August 16, 2015

With the revision of the IRS Audit Guide for the Low-Income Housing Tax Credit Program, the IRS is providing a comprehensive examination of the requirements of the program. Chapter 1 of the Guide provides and introduction and overview of the…

Proposed Rural Housing Service Rule will Reduce Financial Reporting Requirements

August 14, 2015

On August 6, 2015, the Rural Housing Service (RHS) published a proposed rule in the Federal Register that will amend current regulations to change program requirements regarding financial reporting. The proposed change will align RHS requirements with those of the…

IRS Publishes Revised LIHTC Audit Guide – August 11, 2015

August 9, 2015

The IRS has published a revised Audit Guide for the Low-Income Housing Tax Credit Program, with a revision date of August 11, 2015. The Guide is intended to assist IRS examiners when auditing Partnerships that utilize the Federal Low-Income Housing…

Assistance Animals – A Reminder on What is Required

August 5, 2015

On July 15, 2015, HUD charged the owners and manager of Viking Villas, a 36-unit apartment complex in Sioux Falls, SD, with a violation of the Fair Housing Act for refusing to grant a reasonable accommodation to a disabled resident…

Rural Housing Service Accepting Applications for Multifamily Preservation and Revitilization (MPR)

August 3, 2015

On August 3, 2015, the Rural Housing Service published a Notice in the Federal Register announcing the timeframe to submit applications to participate in a demonstration program to preserve and revitalize existing Rural Rental Housing (RRH) projects under Section 514,…

GAO Recommends Joint HUD – IRS Oversight of LIHTC Program

August 2, 2015

Responding to a request from Senator Charles Grassley, Chairman of the Senate Judiciary Committee, the Government Accountability Office (GAO) as performed a review of the oversight and administration of the Low-Income Housing Tax Credit (LIHTC) Program. The results of the…

Affirmatively Furthering Fair Housing – HUD Final Rule

July 18, 2015

On July 8, 2015, the Department of Housing & Urban Development (HUD) issued a final rule on the procedures that must be followed by localities with regard to affirmatively furthering fair housing. The rule directs HUD program participants to take…

RAD – Revised Program Notice PIH-2012-32, REV-2

July 6, 2015

On June 26, 2015, HUD published a Notice in the Federal Register revising some of the rules of the Rental Assistance Demonstration (RAD) Program. HUD’s original notice on the program was published on June 26, 2012. The RAD program provides…

HUD Guidance on First Amendment Conflict with Fair Housing

July 4, 2015

HUD Guidance on First Amendment Conflict with Fair Housing The Department of Housing & Urban Development (HUD) published Notice FHEA-2015-01 on May 26, 2015. The title of the Notice is Substantive and Procedural Limitations on Filing and Investigating Fair…

HUD Notice H-2015-04, Methodology for Completing a Multifamily Housing Utillity Allowance

June 29, 2015

On June 22, 2015, HUD issued Notice H-2015-04, Methodology for Completing a Multifamily Housing Utility Analysis. The Notice provides instructions to owners and management agents for completing the utility allowance required at the time of the annual or special adjustment…

Supreme Court Decision on Disparate Impact, June 25, 2015

June 29, 2015

Supreme Court Rules on Disparate Impact On June 25, 2015, the United States Supreme Court issued a landmark ruling on Texas Department of Housing & Community Affairs v. The Inclusive Community Project, Inc. The ruling found that housing policies…

Revision to RD Section 538 Guaranteed Loan Program Replacement Reserve Requirements

June 18, 2015

The Rural Housing Service published a Notice in the Federal Register on June 18, 2015, amending its regulation to change the requirements of the reserve account for direct Multifamily Housing (MFH) loans. The purpose of the Notice is to address…

Nonprofit Material Participation Requirements

June 6, 2015

Section 42 (h) (5) of the Internal Revenue Code requires that Housing Finance Agencies set aside at least ten percent of their annual allocation for use by non-profit entities. This “non-profit pool” is available only to Qualified Nonprofit Organizations and…

RHS and HUD Merger Potential

May 29, 2015

During a recent hearing before a House Financial Services panel, a representative of the Federal Housing Administration (FHA) and Housing & Insurance Subcommittee Chair Blaine Luetkemeyer (R-MO) argued that the Rural Housing Service (RHS) should be moved from the Department…

Good Cause Evictions – New IRS Guidance

May 26, 2015

The IRS issued a Chief Counsel Advice (CCA) memorandum on March 26, 2015 on the subject of Noncompliance Resulting from Conflicting Program Requirements in the Low-Income Housing Tax Credit program. The memorandum was issued in order to change the advice…

Familial Status Case – Issue of Separate Sex and Bedrooms, April 2015

May 25, 2015

On April 30, 2015, HUD entered into a Conciliation Agreement with Piilani Gardens, LLC regarding alleged familial status discrimination at Piilani Gardens Apartments in Kihei, Hawaii. Piilani Gardens is a family project, but two of the 18 buildings in…

Familial Status Discrimination Case Warns Against Unreasonable Play Area Rules for Children

May 25, 2015

One of the Questions I often am asked during fair housing training is whether children can be restricted from playing in the common areas of apartment communities. The answer depends on the specifics of the community, but generally, rules relating…

HUD Notice CPD-15-02, Appropriate Placement for Transgender Persons in Single Sex Emergency Shelters and Other Facilities – February 20, 2015

May 17, 2015

HUD published Notice CPD-15-02 on February 20, 2015, providing further guidance on the placement of transgender persons in single-sex emergency shelters and other facilities. This guidance is provided in order to clarify the final rule published by HUD on February…

Federal Preemption of State Landlord-Tenant Law

April 24, 2015

A recent ruling by the Wisconsin Supreme Court reaffirms the constitutional doctrine of Federal preemption. In Milwaukee City Housing Authority v. Cobb, March 2015, the Milwaukee Authority sued to evict a resident because he had violated the terms of his…

Verification of Social Security and Supplemental Security (SSI) Payments

April 11, 2015

Verification of Social Security and Supplemental Security Income (SSI) Payments Managers of affordable housing properties (e.g., Section 8, LIHTC, Section 515, etc.) often struggle with the verification of income from Social Security (SS) or SSI. While verification of such…

HUD Notice Grants Authority to Transfer Rental Assistance, Debt, Use Restrictions Between Projects

April 4, 2015

On March 31, 2015, HUD published a Notice in the Federal Register establishing the conditions under which HUD will approve a request for the transfer of project-based rental assistance, debt held or insured by HUD, statutorily required income-based use restrictions…

HUD to Publish Proposed VAWA Regulation

March 30, 2015

HUD Secretary Julian Castro announced on March 25, 2015 that HUD’s proposed regulation implementing the Violence Against Women Act of 2013 (VAWA 2013) will shortly be published in the Federal Register. The rule will implement the VAWA 2013, which expands…

Understanding Military Income and Allowances

March 28, 2015

I get many questions from managers regarding how to deal with and verify income for members of the military. Understanding the military pay system is confusing even for those in the military; it can be impossible for persons not familiar…

Employee Unit Rent

March 22, 2015

As I indicated in a memo I sent to clients on November 7, 2014, the IRS will not consider the charging of rent or utilities for employee or security officer units to be an audit issue. This position is stated…

Davis-Bacon Requirements for Project Based Vouchers

March 14, 2015

HUD issued a Notice in the March 9, 2015 Federal Register providing further guidance on when Davis-Bacon wage requirements may apply to existing housing developments. This guidance relates to the final rule published by HUD on June 25, 2014 amending…

2015 Income Limits

March 7, 2015

On March 6, 2015, HUD published the 2014 income limits for HUD programs as well as for the Low-Income Housing Tax Credit and Tax-Exempt Bond programs. The limits for the LIHTC and Bond projects are published separately from the limits…

Update of Housing Trust Fund – February 18, 2015

February 18, 2015

As I noted in an earlier article, HUD has published interim regulations regarding how the Housing Trust Fund (HTF) program will be administered when funds are made available (hopefully in 2016). A final rule is anticipated before Summer 2015. Developers…

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