TCS Income Calculation and Verification 2 — Questions and Answers
Question 1: Assets valued at $5,000 or less are subject to which income calculation method?
- Only actual income earned is counted (Correct answer)
- Imputed income at the passbook rate is counted
- No asset income is counted
- A flat $100 is counted per asset
Correct answer: Only actual income earned is counted
When total household assets are $5,000 or less, only the actual income earned from those assets is counted.
Question 2: When household assets exceed $5,000, the income counted must be the:
- Actual income only
- Imputed income only
- Greater of actual or imputed income (Correct answer)
- Lesser of actual or imputed income
Correct answer: Greater of actual or imputed income
When assets exceed $5,000, the income counted is the greater of the actual income earned or the imputed income calculated using the HUD passbook rate.
Question 3: Which of the following is considered an asset under LIHTC income calculation rules?
- Personal property such as furniture
- Equity in a mobile home used as a primary residence (Correct answer)
- Retirement accounts that cannot be accessed
- Interests in a business
Correct answer: Equity in a mobile home used as a primary residence
Equity in a mobile home that is the household's primary residence is counted as an asset under LIHTC rules.
Question 4: A household member quits a full-time job before move-in. How should this income be treated?
- It is excluded since they no longer work
- It is included because assets can replace wages
- It is included as imputed income if the person voluntarily reduced income (Correct answer)
- It is included only if there is a signed separation agreement
Correct answer: It is included as imputed income if the person voluntarily reduced income
Income from assets or employment voluntarily reduced or terminated must be counted as imputed income to prevent households from manipulating qualification.
Question 5: Overtime and seasonal income should be projected based on:
- Only current pay period earnings
- Historical averages provided by the employer or documented by the employee (Correct answer)
- The federal minimum wage as a baseline
- The state-required maximum projection
Correct answer: Historical averages provided by the employer or documented by the employee
Overtime and seasonal income are projected using historical averages, typically verified through employer letters or prior pay stubs.
Question 6: Which household income must be included when a 16-year-old member works part-time?
- It is excluded if they are a student
- It is included in full because all household members' income counts (Correct answer)
- It is excluded if the parent is the head of household
- Only 50% of the income counts
Correct answer: It is included in full because all household members' income counts
Income of all household members, including minors, must be counted in full when calculating household gross income for LIHTC eligibility.
TCS Income Calculation and Verification 2
Assets valued at $5,000 or less are subject to which income calculation method?