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Guide for Completing Form 8823 - page 72 / 197





72 / 197

file review on May 1, 2004.

The state agency selected Unit A as part of the 20% sample and reviewed the household’s income certification and noted the corrections. Because the owner corrected the noncompliance before the April 20, 2004 notification date, the owner is in compliance.

*100% LIHC Projects*

*Tax Years Ending Before July 31, 2008

An owner may have received a waiver of the annual income recertification requirements under Rev. Proc. 2004-38, 2004-2 C.B. 10 or Rev. Proc. 94-64, 1994-2 C.B. 797, which applied to owners of qualified low-income housing projects that consist entirely of 100 percent low-income buildings. If noncompliance with the tenant income certification requirements was sufficiently serious, consideration was given to revoking the waiver. Revocation was not required, but the Service would revoke the waiver at the state agency’s request.

Tax Years Ending After July 30, 2008

Under IRC §142(d)(3)(A), if all the low-income buildings in the project are 100% low- income buildings, owners are not required to complete annual tenant income recertifications.2 “Projects” are identified based on the owner’s election as documented on Form 8609, line 8b.3 Previously approved Income recertification waivers are subsumed by the new law and are no longer in force.*

Mixed-Use Buildings

Note: For buildings with both LIHC units and market rate units, the state agencies must also determine whether the owner appropriately applied the Available Unit Rule when a household’s income exceeds 140 percent of the income limit at the time of recertification. See chapter 14.

In Compliance

Owners *of mixed-use LIHC properties* are in compliance if the recertification is completed within 120 days before the anniversary of the effective date of the original tenant income certification.

Household Vacates Unit

If an owner has sent a timely notice informing the household that the annual recertification is due, but the household does not provide the certification and supporting documentation prior to vacating the unit, the vacated unit will not be considered out of compliance with the recertification requirements. Owners should document attempts to obtain the recertification and the date the tenant actually moved out.

2 *IRC §142(d)(3)(A) was amended by section 3010 of the Housing Assistance Tax Act of 2008 and is effective for taxable years ending after July 30, 2008. IRC §142(d)(3)(A) is made applicable to IRC §42 low-income projects in IRC §42(g)(4).*

3 *Each building is considered a separate building unless each building that is (or will be) part of the multiple-building project is identified by check “yes” on Form 8609, line 8b, and attaching a statement identifying the (1) name and address of the project and aggregate credit associated with the project, and (2) the address and building identification number (BIN) and credit associated with every building in the project.*


Revised October 2009

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