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 recipients as long as the loans are used to pay eligible expenses. While it was clear that a ... more
Affordable Housing
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 a written procurement policy that outlines ... more
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 approach to risk, we are creating this comprehensive tool designed to help ... more
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 that new affordable housing can be a tough sell at the neighborhood level. There is still a public perception that ... more
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 is properly structured to support sustainable affordable housing. Citing efforts by tech giants Apple, Google and ... more
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 three-page form reduces the documentation and calculations required to apply ... more
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. The following chart summarizes the key provisions compared to the original CARES Act ... more
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 application form consists of four components: ... more
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 lawful at this time, even for nonpayment of rent. As a result, there are efforts to provide assistance ... more
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 to years beginning in 2020 only, and not to years beginning in 2019. The LIHTC partnership may elect to not ... more
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 costs, interest rates, diminished financing and tax options, and zoning issues. Even Opportunity Zones as an avenue ... more
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 many rate hikes, if any, will occur in 2019. On average, the forecast is for two rate hikes, which FOMC ... more
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 very busy through 2019, it doesn’t necessarily mean that margins will ... more
LIHTC Partnerships Impacted by Limitations on Business Interest
Due to the changes in the federal tax law resulting from the passage of the 2017 Tax Cuts and Jobs Act, the deduction for business interest can be severely limited for many taxpayers for tax years beginning after December 31, 2017. The interest deduction cannot exceed the sum of: Business interest income for the tax year 30% of the taxpayer’s adjusted taxable income Taxpayer’s floor plan financing interest (applicable to auto ... more
Clarify Your Not-for-Profit’s ‘Story’ in Financial Statements
Over more than 30 years of work with not-for-profits, the team at Lindquist, von Husen & Joyce LLP has looked for new ways to help organizations share their unique story. Often, we help them tell it through their numbers. Numbers are a language, but sometimes they can become a foreign language in financial statements. When reviewing the financial statements of most not-for-profit affordable housing developers, for example, we’ve seen that ... more