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NCSHA Recommends Improvements to IRS Housing Credit Disaster Relief Guidance (Notice 2019-52)

Published on November 1, 2019 by James Tassos
NCSHA Recommends Improvements to IRS Housing Credit Disaster Relief Guidance (Notice 2019-52)

On Thursday, NCSHA sent comments to IRS on how it can improve Low Income Housing Tax Credit (Housing Credit) disaster relief guidance provided in Revenue Procedures 2014-49 and 2014-50. NCSHA’s letter is in response to IRS’s request for comments in Notice 2019-52, which also provided additional guidance on Housing Credit disaster relief specific to California’s recovery from certain wildfires that took place in November 2018. Specifically, NCSHA urged IRS to expand its disaster relief guidance to:

  • Address the treatment of residents returning to an affected property following a natural disaster, including whether the property owner is required to recertify residents before they can return to the property and, if so, how to handle residents who may be over-income upon their return if they were income-qualified upon initial occupancy;
  • Clarify that owners must maintain compliance in non-damaged units if only a portion of the property is affected by natural disaster (for example, flooding that impacts only the ground floor of a development);
  • Consider the issue of destroyed records following a natural disaster — whether an owner is required to attempt recreation of destroyed records and, if not, the relief provided to those owners in this case;
  • Provide a process for Housing Credit allocating agencies to request from IRS an extension of relief period deadlines for projects impacted by multiple disaster events regardless of whether the successive disaster was designated a presidentially-declared disaster; and
  • Consider expanding certain relief provided in this guidance to properties impacted by casualty losses, even if the loss does not result from a presidentially-declared disaster.

Please contact NCSHA’s Jim Tassos with questions.