Presented by Jo Ikelheimer The National Center for Housing Management © All Rights Reserved Tenant Qualification: Student Issues

Student eligibility for LIHTC Student income issues Blended student eligibility Overview

LIHTC Student Eligibility

4 Why Student Restrictions? Income Traditional HUD Housing Market Rate Housing Low-Income Housing Tax Credit Program Student Household Eligibility

5 Key Ingredient Households consisting entirely of full time students are NOT eligible for tax credit qualification, UNLESS they meet one or more of the five student eligibility exceptions. Student Household Eligibility

6 Exception #1 All members of the household are married and entitled to file a joint tax return. Student Household Eligibility

7 Exception #2 Household consists of a single parent(s) and their child(ren) And no one in the household is a dependent of a third party −Except that children of single parents are allowed to be dependents of the other parent. Student Household Eligibility

8 Exception #3 At least one member of the household receives assistance under Title IV of the Social Security Act (i.e. TANF) Student Household Eligibility

9 Exception #4 At least one member of the household is participating in a job training program such as those funded under the Workforce Investment Act (WIA). Student Household Eligibility

10 Exception #5 At least one member of the household was formerly in foster care. This should be verified by contacting the agency who administered the foster care program. Student Household Eligibility

11 Exception #6 (Proposed) S.1412 – Housing for Homeless Students Act of 2015 Latest action on 5/21/15 Referred to the Committee on Finance Would cover homeless students and vets who are full-time students for LIHTC eligibility Student Household Eligibility

12 Full-time student status can change from year to year Student eligibility is an ongoing issue Annual student certification is required Check with state housing agency for required certification form(s) Annual Student Certification Student Eligibility Nuances

13 School-aged children in grades K-12 are considered full-time students Legislation proposed to change this failed passage Student Eligibility Nuances Student Definition

14 Definition of full-time must be met for the particular educational institution being attended Attendance at regular facilities for 5 or more months (during the calendar year in which the taxable year of the taxpayer begins) Student Definition Student Eligibility Nuances

15 Be mindful of continuing student status Five months of calendar year do not have to be consistent Out of compliance on the first day of the fifth month during the calendar year Out of Compliance Student Eligibility Nuances

LIHTC Student Income Issues

17 Count all income of all family members except: – Employment income for dependent children under the age of 18 – Employment income of dependent full- time students age 18 or older (count only the first $480) Whose Income is Counted? Student Employment Income Par. 5-6, p. 5-6, HUD Handbook , REV-1

18 Student Employment Income

19 For Section 8 students, financial assistance in excess of tuition is counted as income, unless the student is: – Over age 23 with a dependent child, or – Living with his or her parents who are receiving assistance Educational Scholarships Student Financial Aid Par. 5-6 E, p. 5-10

20 The rule only applies for LIHTC when students are receiving Section 8 assistance, otherwise do not count educational scholarships or grants The rule applies to full-time and part-time students Educational Scholarships Student Financial Aid Par. 5-6 E, p. 5-10

21 Use this formula to calculate student financial assistance to the extent it exceeds tuition: Educational Scholarships Student Financial Assistance - Tuition & Fees Income that should be counted Student Financial Aid Par. 5-6 E, p. 5-10

Blended Student Eligibility

Section 8 Student Eligibility Requirements – Unless they meet an exception, Section 8 Assistance shall not be provided to any individual who is enrolled either full-time or part-time at an institution of higher education or other program leading to a recognized educational credential (HUD Handbook , Rev. 1, Par. 3-13A) – Other HUD P/B Student Eligibility Requirements found in (Par. 3-13B) Blended Student Eligibility

HOME Student Eligibility Requirements – Adopts Section 8 Housing Choice Voucher program restrictions on student participation found at 24 CFR – Excludes any student enrolled in a higher education institution and under the age of 24 unless: Veteran of U.S. military Married Has a dependent child(ren) Person with disabilities Individually eligible Parents who are eligible based on income Blended Student Eligibility

RD Student Eligibility Requirements – Legal Contract Age under State Law – Household Separate and distinct from Parents/Guardians – Not claimed as Dependent by Parents/Guardians on IRS Tax Returns and provide evidence to this – Certification of Financial Aid from Parents/ Guardians & Others even if $O Blended Student Eligibility

Considerations for Blended Units – For Section 8,HOME and RD, any student of higher education, either full-time or part-time, must qualify – For LIHTC, households consisting only of full- time students must qualify, but this includes students in grades K-12 Blended Student Eligibility

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