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IRS Published Final Regulations on Housing Credit Utility Allowance

Published on February 26, 2016
IRS Published Final Regulations on Housing Credit Utility Allowance

The Internal Revenue Service (IRS) published in the Federal Register combined final regulations amending the Housing Credit utility allowance rules to provide greater clarity for Housing Credit properties that submeter to account for actual tenant energy consumption, and temporary regulations for properties in which an owner acquires energy directly from renewable sources, rather than from a utility company.

The final regulations codify an IRS 2012 proposed rule requiring that utility costs paid by a tenant and based on the tenant’s actual energy consumption in a submetered Housing Credit-qualified unit are treated as paid by the tenant directly to the utility company and thus do not count against the maximum rent that the building owner can charge.

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