Guidance on the effect on the income requirements under section 142(d) and section 42 of the alternative income eligibility requirements
The IRS today released Rev. Proc. 2024-38 as guidance on the effect on the income requirements under section 142(d) (providing rules for qualified residential rental projects financed with exempt facility bonds) and section 42 (providing rules for qualified low-income housing projects) of the alternative income eligibility requirements for the Department of Housing and Urban Development–Veterans Affairs Supportive Housing (HUD–VASH) program, which were published in the Federal Register on August 13, 2024.
Rev. Proc. 2024-38 provides that for purposes of initial and continuing income determinations under sections 142(d)(2) and (3), respectively, and with respect to whether any project is a qualified low-income housing project as defined in section 42(g) and whether any unit is a low-income unit as defined in section 42(i)(3), all Department of Veterans Affairs (VA) service-connected disability benefits are excluded from income (consistent with the HUD–VASH income eligibility waiver) for prospective and current tenants who, as of the date of the income determination, are approved to receive or are currently receiving assistance under the HUD–VASH program and to whom the HUD–VASH income eligibility waiver applies.
Rev. Proc. 2024-38 generally applies to income determinations with respect to residential rental projects financed with exempt facility bonds under section 142(d) issued as part of an issue with an issue date on or after October 24, 2024, and with respect to qualified low-income housing projects as defined in section 42(g), and low-income units as defined in section 42(i)(3) on or after October 24, 2024.