HCCP Regulatory Compliance 4

Question 1

Under the 'available unit rule,' when an over-income tenant's unit becomes vacant, who must the owner rent the next available comparable unit to?

Accepted Answer

A qualified low-income tenant

Answer

Any tenant regardless of income until the over-income unit is vacated

Answer

Another over-income tenant to maintain the same composition

Answer

The current over-income tenant if they choose to transfer

Question 2

Which of the following events would most likely trigger a recapture of LIHTC credits under IRC §42(j)?

Accepted Answer

Disposing of the building before the end of the compliance period without a qualifying transfer

Answer

Renting one unit to a slightly over-income tenant while all other units remain qualified

Answer

A temporary 30-day vacancy in a low-income unit

Answer

Increasing rents to fair market rate for one month before reducing them again

Question 3

What is the correct treatment of a student household under LIHTC rules if all members are full-time students?

Accepted Answer

The unit generally does not qualify as a low-income unit unless an exception applies

Answer

Student households are always eligible for LIHTC units regardless of enrollment status

Answer

Full-time students qualify only if they attend a vocational school

Answer

Full-time student households qualify only if their income is at or below 30% AMI

Question 4

An owner places a residential rental building in service in June of Year 1. Under the first-year convention, how many months of credit can the owner claim in Year 1?

Accepted Answer

7 months

Answer

12 months

Answer

6 months

Answer

1 month

Question 5

A LIHTC property manager discovers that tenant income certifications were not obtained at move-in for three tenants in Year 2. Under IRS guidance, what is the owner's best course of action?

Accepted Answer

Obtain retroactive certifications immediately and document corrective action to present to the state agency

Answer

Evict the uncertified tenants immediately to cure the noncompliance

Answer

Do nothing since certifications can be waived if tenants are clearly low-income

Answer

File an amended Form 8586 to reduce claimed credits for those units

Question 6

Under IRC §42, which of the following is considered part of eligible basis for a new construction LIHTC project?

Accepted Answer

Hard construction costs directly associated with the residential rental units

Answer

Land acquisition costs

Answer

Permanent loan origination fees

Answer

Developer fee paid to the managing member

Question 7

A LIHTC property owner wants to convert a low-income unit to market rate before the end of the extended use period. Under IRC §42(h)(6), which outcome is most likely?

Accepted Answer

The state agency can enforce the extended use agreement, blocking conversion

Answer

The owner may convert the unit after paying a fee to the state agency

Answer

The IRS will automatically recapture all credits for that unit

Answer

Conversion is permitted if the owner replaces the unit with another comparable low-income unit