The Section 42 LIHTC Tax Credit Program is a program for individuals and families making moderate or lower incomes. Congress created the Program in 1986 as part of the Tax Reform Act and is administered by the Internal Revenue Service.
BENEFITS TO YOU
The benefits to residents living here, are that the apartments are newly constructed or substantially renovated with rents usually lower than the market rate. The rents are no higher than 30% of the area median income as published by HUD, often resulting in rents lower than other comparable apartments
INCENTIVE TO OWNERS
Owners are offered a reduction in their tax liability in exchange for offering quality housing at these fixed rents. To receive this reduction, the owners must annually certify that the residents are qualified under the Program requirements and are paying the correct amount of rent.
DIFFERENCE FROM HOUSING PROGRAMS
This Program is not a subsidized housing program or Section 8. Each resident is responsible for the full amount of rent each month. The rental amount is NOT based on your individual household income, rather on the pre-set income limits in the area. Some apartments within a particular apartment community may not be part of this program. The rent for these apartments will often be higher.
DETERMINE YOUR ELIGIBILITY
To find out if you qualify for Program, management must determine if you:
- Are Income Eligible
- Meet Other Program Requirements
- Meet their Resident Selection Criteria
If it is determined that you meet all Program requirements and management’s resident selection criteria, you will be qualified for an apartments.
To become eligible, your total household income including income from your assets, must be less than or equal to the pre-set income limit for the area.
An interview with you and the other adult members of your household to determine all income and asset sources.
Verify all income and assets through the appropriate sources. It will be your responsibility to assist management with this step and to provide all the necessary information to expedite this process. (names, addresses, etc.) Calculate your total household income using the information provided by your income and asset sources.
The other Program requirements are often specific to the apartment community you are applying to move into. Some apartment communities or individual apartments may be designated for certain population groups such as elderly adults or individuals with disabilities. Discuss these other requirements with the management staff.