Category: Affordable Housing

City of San Francisco

What’s Next for Low-Income Housing Tax Credits?

In January 2024, the House passed a bipartisan tax bill that expanded the Low Income Housing Tax Credit. Called the “Tax Relief for American Families and Workers Act of 2024,” the bill restores a temporary 12.5% increase in the LIHTC and supports the use of private activity bonds to finance affordable housing developments. The bill

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More Solutions for Affordable Housing Financing

With national housing at a crisis level, underproducing millions of units annually, public and private partnerships are getting more creative about how to solve this puzzle across the country. Traditional sources of government funding are limited, traditional lending is expensive and institutional investors are pulling back from housing investment. Now, developers and new funders are

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Apartment building

Surplus Cash Calculation and Distribution

Written by Joe Li. Previously published in Multi-Housing News Surplus cash calculation and distribution is one of the most interesting parts of the financial statements of affordable housing entities. It determines the amount of residual cash available to make fees, distributions, ground leasing and deferred loan payments. Surplus cash distribution and the calculation itself are

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Low angle of affordable housing units

Long-Term Strategies for Affordable Housing

Developers are seeking new financing methods to rehab and build affordable housing across the U.S. Combinations of public and private financing include traditional federal and state programs paired with venture capital, REITs and also private corporations that want to support and preserve affordable workforce housing in their markets. Affordable housing is comparably recession resistant. This

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After the Audit: How to Assess Improvements

You may have had a “good” audit, but there is always room for improvement. Use what you’ve learned to your advantage by making improvements in your processes and controls throughout the year. When in doubt, ask your audit team! 1. Don’t wait Don’t wait until your next audit for audit planning. Reach out to your

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Affordable housing unit

Deal Funding: Deferred Developer Fee Is Only One Solution

Congress’ recent spending package offers an increased $4.5 billion to HUD for fiscal year 2023, including a “Yes in My Backyard” (YIMBY) grant program and increased funding for several existing programs. This news may or may not ease concerns among developers about significant project cost increases and funding gaps. A recent article in Affordable Housing

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Solar powered apartment building

Business Energy Credit Impacted by Inflation Reduction Act

The Inflation Reduction Act (IRA) signed into law by President Biden on August 16, 2022, included an expansion of existing tax credits to promote clean energy generation. One of the credits impacted by the IRA is the business energy credit for solar property under Internal Revenue Code (IRC) Section 48(a)(3)(A)(i). The changes to the IRC

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Tips to Avoid Misstatements in Affordable Housing Intercompany Transactions

We frequently get questions from affordable housing managers regarding the reconciliation of intercompany accounts and confirmation of balances between business units. Intercompany transactions are not unusual for developers with multiple properties, but they can result in misstatements on the balance sheet without proper internal controls. During the planning phase of an audit, we often identify

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A room being renovated with ladders in background

How Does Resyndication Work For Affordable Housing?

For older multi-family housing properties that need rehabilitation beyond what is possible with replacement reserves, developers will seek outside investors interested in tax credits. Introducing Resyndication New private equity players are assembling funds to support these projects and preserve affordable housing, but the project must be large enough to make it worth their investment. Resyndication

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Family smiling sitting in front of laptop

New Broadband Access Grant Program for Affordable Housing

Developers in underserved communities will have access to federal passthrough state grants to lower installation costs of broadband internet in new developments and existing multi-family properties. The grants will help finance delivery of free Wi-Fi access to residents. Part of the $1.2 trillion Infrastructure Investment and Jobs Act (IIJA), the Broadband Equity, Access, and Deployment Program

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Construction worker framing a house

New How-To Guide for Affordable Housing Finance

Over the coming months, the U.S. Department of the Treasury (Treasury) is conducting webinars and briefings with states, local governments and nonprofit and private sector entities to discuss how State and Local Fiscal Recovery Funds (SLFRF) can be used to expand affordable housing supply. They have also published a how-to guide. New guidance clarifies how

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Wondering what to include on your resume?

Your resume is your go or no-go qualifier for any job you apply for. Of course, there are others tests to pass once you submit your resume, but the first gate you will need to pass is the resume test. As a prospective candidate, you want to know what you should include on your resume

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3 Tips to Help Your Board Members Succeed

Board members have a fiduciary duty as stewards of public trust to act in the best interests of the organization that they serve. They lay aside personal interests to focus on ethical oversight of the organization’s mission accomplishments, results of operations and financial position. Nonprofit board members may monitor support and other funding to ensure

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Due for an Audit? Identify Issues Sooner Not Later

Surplus cash calculation and distribution is one of the most interesting parts of the financial statements of affordable housing entities. It determines the amount of residual cash available to make fees, distributions, ground leasing and deferred loan payments. Surplus cash distribution and the calculation itself are important to review during an audit because: Lenders, lessors,

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A pen checking off checkboxes on a form

Update Your CTCAC Compliance Forms

The California Tax Credit Allocation Committee (CTCAC) has published updated versions of almost all forms for low-income housing tax credit (LIHTC) compliance. Owners and management agents have through December 31, 2022 to implement use of the new forms. The CTCAC will not accept use of modified or previously approved forms — or modifications or changes

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Row of low income housing units.

IRS Extends Temporary Relief for Late-leased Units

Notice 2022-05 released by the Internal Revenue Service (IRS) on January 10, 2022 provided extensions to various compliance deadlines for low-income housing projects claiming credits under Internal Revenue Code (IRC) Section 42. Prior to the release of Notice 2022-05, the IRS had provided temporary relief in its Notice 2021-12. However, due to the ongoing COVID-19

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Family sitting on the floor of new apartment with moving boxes around them.

IRS Guidance On Minimum 4% LIHTC Rate

On December 1, 2021, the Internal Revenue Service (IRS) issued guidance on the minimum 4% low-income housing tax credit (LIHTC) rate. Revenue Ruling (Rev Rul) 2021-20 clarifies when the 4% floor applies to projects receiving housing credit allocations or tax-exempt bonds. Revenue Procedure (Rev Proc) 2021-43 provides safe harbors for determining whether an exempt bond

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New IRS Guidance: Non-Deductibility of Expenses Paid with PPP Loans

The Paycheck Protection Program (PPP) created under the Coronavirus Aid, Relief, and Economic Security (CARES) Act provides loan funds to small businesses in order to help them pay eligible expenses (payroll costs, mortgage interest, rent, and utilities).  These covered loans are to be fully forgiven and not to be treated as income to the loan

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Nonprofit Purchasing Policy Considerations

Nonprofits have a multitude of compliance standards to juggle, and constructing a comprehensive nonprofit purchasing policy is no exception. Maintaining tax-exempt status requires adherence to very specific behaviors, and written policy should be reviewed periodically to ensure your organization meets or exceeds standards. Under the new procurement standards, all NPOs receiving federal awards must have

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Webinar Round-Up: Risk Identification Matrix Unveiled

S. Scott Seamands, partner at Lindquist von Husen & Joyce, LLP, and Julie Goldfine, COO/CFO at Mutual Housing California, revealed a risk identification matrix currently under development by our firm that serves as an information network for financial learning in the nonprofit affordable housing industry. After years of interviews and discussions with CFOs about their

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Pandemic Heightens Sustainable Affordable Housing Efforts

Since the PATH Act in 2015, no major federal legislation has come about to address massive shortages in affordable housing across the U.S. While the House and Senate introduced many bills   since then, legislation seems to die in committee or across the aisle. Much more legislation is enacted at the state level, but we know

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How Affordable Housing Really Happens: Finance + Community

An article last fall in the New York Times demonstrated what billions can and can’t do to bring about more affordable housing in a large metropolitan area. It can’t, for example, convince community groups to allow development in their neighborhoods or local government leaders to support it. Money alone also can’t ensure that a deal

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SBA Revises Forms for PPP Loan Forgiveness, Including New EZ Form

The Small Business Administration (SBA) has issued a revised Form 3508, Paycheck Protection Program (PPP) Loan Forgiveness Application.  The SBA also released a streamlined PPP Loan Forgiveness Application, Form 3508EZ.  The newly issued application forms were needed to address the changes brought upon by the PPP Flexibility Act (PPPFA) of 2020. Form 3508EZ This new

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Paycheck Protection Program Flexibility Act of 2020

The Paycheck Protection Program Flexibility Act (PPPFA) was signed into law on June 5, 2020, to modify certain provisions related to the forgiveness of loans under the Paycheck Protection Program (PPP). One change allows recipients of loan forgiveness under PPP to also defer a portion of 2020 payroll taxes, but there are several other modifications. 

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PPP Loan Forgiveness Application and Instructions Now Available

The Small Business Administration (SBA) has finally released the much-anticipated guidance on how borrowers can request forgiveness of their Paycheck Protection Program (PPP) loans. Borrowers will file SBA Form 3508, Paycheck Protection Program Loan Forgiveness Application. Form 3508 is an 11-page application with instructions that provide guidance on calculating the amount of loan forgiveness. The

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Affordable Housing FAQ Resource for Multifamily Landlords and Managers

  The coronavirus pandemic has created a disruption to the housing market. Many multifamily and affordable housing landlords and managers are seeing missed rent payments as tenants are losing income. Even if tenants are paying there is an uncertainty around whether or not they will be able to continue. In many markets, evictions are not

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Washington D.C. capital building at dusk.

Changes to Sec. 163(j) that Impacts LIHTC Partnerships under CARES Act

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) amended Section 163(j) to allow many taxpayers to deduct more business interest expense for taxable years beginning in 2019 and 2020 by increasing the limitation from 30% of Adjusted Taxable Income (ATI) to 50% of ATI. For partnerships, the increase to 50% of ATI applies

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2019 Affordable Housing Outlook Cites SF Prefabs

In our “in case you missed it” category, we recently highlighted a report in our News Updates from Multi-Housing News on what’s ahead for affordable housing in 2019.  This outlook touches on the multitude of constraints that made 2018 a difficult year for the industry as well as why these constraints continue: land costs, materials

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2019 Federal Interest Rates Forecast Requires Caution

As reported in December, the Federal Open Markets Committee (FOMC) elected to raise the federal funds rate by 25 basis points to a targeted range of 2.25 to 2.5 percent. The committee cited a strong labor market, low unemployment and increased household spending and economic activity.   The decision has financial experts speculating on how

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2019 Construction Outlook Indicates Inflation, Wage Pressure

Rates of construction work under contract, but not yet completed, have risen dramatically in the West, according to the Associated Builders and Contractors Backlog Indicator. Technology-based construction projects are driving backlog growth to almost 11 months, particularly for markets like San Jose and Los Angeles. While that means that construction companies can expect to be

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