IRS Provides Housing Credit Relief In Oklahoma
05 June 2013
Posted by: Author: Mike Godfrey
Author: Mike Godfrey
The United States Internal Revenue Service (IRS) is suspending certain requirements for low-income housing tax credit (LIHTC) residential rental projects, and for those projects financed with exempt facility bonds, to provide emergency housing relief needed after the severe storms and tornadoes in Oklahoma that occurred between May 18 and May 27, 2013.
On May 20, 2013, President Barack Obama issued a major disaster declaration for the State of Oklahoma because of the devastation caused by the tornadoes. Subsequently, the Federal Emergency Management Agency (FEMA) designated jurisdictions in Oklahoma as eligible for assistance.
Following the disaster declaration issued by FEMA, the IRS announced that affected taxpayers would receive special tax relief. Various tax filing and payment deadlines that occurred starting on May 18, 2013 have already been postponed. For example, affected individuals and businesses will have until September 30, 2013 to file returns and pay any taxes due.
Because of the damage to housing caused by the tornadoes, the IRS has now determined that state housing agencies may provide approval to LIHTC project owners in their respective states to provide temporary emergency housing for displaced individuals, and that certain income limitation requirements for such housing projects should be suspended.
The applicable agency will determine the appropriate period of temporary housing for each project, but not extending beyond May 31, 2014. After the end of this temporary housing period, the requirement to make reasonable attempts to rent vacant units to low-income individuals will resume.
In addition, the IRS is also suspending certain requirements for those LIHTC projects providing emergency housing relief that are financed with exempt facility bonds issued by a qualified issuer.
If an issuer that has issued exempt facility bonds to finance a project desires to allow the use of the project to temporarily house displaced individuals, regardless of their income, it must approve that use and must determine an appropriate period for the temporary housing, not to extend beyond May 31, 2014.
However, existing tenants in a project whose income is at or below an applicable income limitation for the LIHTC cannot be evicted or have their tenancy terminated as a result of efforts to provide temporary housing for displaced individuals.