TCS Initial Occupancy and Move-In Procedures 2 — Questions and Answers
Question 1: Which of the following is a required element of third-party income verification at move-in?
- A verbal confirmation from the employer
- A signed verification form sent directly to and from the employer (Correct answer)
- A screenshot of the applicant's online pay portal
- A copy of the applicant's driver's license
Correct answer: A signed verification form sent directly to and from the employer
Third-party verification requires written confirmation from a neutral source, such as a signed employer verification form, not verbal or applicant-provided documentation.
Question 2: A unit is designated as a manager unit at a LIHTC property. Is an income certification required for the manager?
- Yes, all occupants of LIHTC units must be certified
- No, manager units are exempt from income certification requirements (Correct answer)
- Only if the manager is also a tenant paying rent
- Only if the manager unit was originally a LIHTC unit
Correct answer: No, manager units are exempt from income certification requirements
Manager units occupied by employees as a condition of employment are generally exempt from LIHTC income qualification and certification requirements.
Question 3: When calculating income for a new applicant, the owner must use:
- Prior-year tax returns only
- Anticipated annual income for the coming 12 months (Correct answer)
- The highest income earned in the past three years
- The income reported on the most recent pay stub only
Correct answer: Anticipated annual income for the coming 12 months
LIHTC income eligibility is based on anticipated gross annual income for the next 12 months, not historical income.
Question 4: A student household applies for a 100% LIHTC property. The household consists of two full-time graduate students with no children. Are they eligible?
- Yes, graduate students are always exempt from student rules
- No, full-time student households without qualifying exceptions are ineligible (Correct answer)
- Yes, if their income is below 50% AMI
- No, only undergraduate students are restricted
Correct answer: No, full-time student households without qualifying exceptions are ineligible
All-full-time student households that do not meet a statutory exception are ineligible for LIHTC units under IRC Section 42(i)(3)(D).
Question 5: At move-in, the owner should retain income verification documents in the tenant file for at least:
- 3 years after the end of the compliance period
- 6 years after the end of the extended use period (Correct answer)
- The duration of the compliance period plus 3 years
- At least 6 years from the date of the record
Correct answer: 6 years after the end of the extended use period
IRS regulations require that tenant income verification records be retained for at least 6 years after the end of the extended use agreement.
Question 6: A household moves in mid-month. For purposes of the unit fraction test, the unit is counted as occupied starting:
- The first of the following month
- The actual move-in date (Correct answer)
- The date the lease is executed
- The date the income certification is signed
Correct answer: The actual move-in date
The unit is counted as occupied from the actual move-in date for purposes of satisfying the minimum set-aside and unit fraction tests.
TCS Initial Occupancy and Move-In Procedures 2
Which of the following is a required element of third-party income verification at move-in?