The Pennsylvania Housing Finance Agency (PHFA) has issued a second draft of their 2019-2020 Allocation Plan for low-income housing tax credits.

According to the draft Allocation Plan, applicants will be required to submit an Intent to Submit Fact Sheet and Development Synopsis to PHFA on or before August 31, 2018. The final applications will be due to PHFA by 3 pm on November 16, 2018.

A number of changes have been made since the first draft of the 2019 Allocation Plan was released. A few of those changes include:

• The addition of Income Averaging language and several related changes
• A change in the time period the allocation plan covers (the new draft covers the 2019 and 2020 years)
• An increased required length of the Restrictive Covenant Agreement to 35 years.

You can read the revised draft allocation plan here.

Written comments on the draft allocation plan are due to PHFA by July 10, 2018.

A Pre-Application meeting will be held by PHFA on August 7, 2018 at the Red Lion Hotel Harrisburg/Hershey.

McKonly & Asbury is a leader in preparing and consulting on low-income housing tax credit applications in Pennsylvania. Our team is passionate about making your application a success. We have a comprehensive understanding of the challenges and nuances of structuring a low-income housing tax credit deal. We are able to assist you in putting the entire application package together for submission, or we can review your application and provide suggestions for optimizing points for PHFA scoring. For more information, please contact us at affordablehousing@macpas.com.

On May 31, 2018, the Internal Revenue Service (IRS) published an updated version of Form 8609, which is the form owners file with the IRS in order to claim low-income housing tax credits.

The updated version includes an additional minimum set-aside option under line 10c on the form – the “average income” option. Owners may benefit from selecting the new set-aside option, bringing with it the opportunity to offer affordable housing to renters earning up to 80% of area median income. Owners should seek the advice of their accountant prior to filing Form 8609.

While the updated form is available on the IRS website, updated instructions have not yet been released.

McKonly & Asbury is a leader in accounting for affordable housing developments in Pennsylvania. IRS and PHFA regulations require specialized knowledge when accounting for LIHTC developments whether it's performing a 10% Test or Development Cost Certification; or performing development stage audits and preparing partnership tax returns. The M&A Team has the audit and tax expertise and experience needed. For more information, please contact us at affordablehousing@macpas.com.