HUD and Low-Income Housing Tax Credit (LIHTC) Program Information
This community has a select number of HUD-subsidized units. HUD rent is determined based on a household’s income. The tenant's portion typically amounts to 30% of their monthly adjusted income.
This community is also part of the Low-Income Housing Tax Credit (LIHTC) program. Unlike the HUD Project-Based Rental Assistance Program (commonly known as Section 8), where a tenant’s monthly rent is limited to a percentage of their personal income (e.g., paying no more than 30% of one’s income toward rent), LIHTC maximum rental rates are set annually by HUD, based on the rise or fall of the area median income (AMI) in the county where the apartment building is located.
During the tax credit application and allocation process, income "set-asides" (income brackets) are determined for the property. The set-asides specify the maximum income level of tenants who are eligible to reside in the tax credit units. While a tenant's income is used to determine their eligibility for the tax credit unit, the rent itself is based on the AMI and the apartment size. The LIHTC program differentiates between "gross rent" and "net rent." Gross rent is the maximum allowable rent, while net rent is the amount payable by the tenant after the utility allowance is deducted. The LIHTC program does allow for rents to be increased, as needed, if there is an increase in the AMI to offset increased management and operating costs. The rent could be increased to the maximum tax credit rent limits even if the resident's income remains the same or decreases.
Please see the Band of Affordability for the rent limit per set-asides and apartment size.
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