To confirm the tax credit in a lease, specific language can be included that addresses the unique requirements of Low-Income Housing Tax Credit (LIHTC) properties. Here are some elements that should be considered:
- Household Members Listed: Ensure that every member of the household is listed in the lease. All individuals over the age of 18 should sign the lease unless they are full-time students.
- Income Qualification: Include a clause stating that the household must meet income eligibility requirements at move-in and during any subsequent recertifications. Mention that additions to the household must also meet these requirements.
- Lease Term: Specify that the initial lease term is at least six months, as required for LIHTC units. This can include free rental periods of one month or less.
- Certification Date: Clarify that the initial certification date coincides with the commencement date of the lease. Income verification must be dated within 120 days prior to the lease start.
- Recertification Process: Outline the recertification process, including that it can be done up to 120 days in advance and is effective on the anniversary date of the initial certification.
Example of Specific Language
Income Eligibility and Recertification:
“The household must meet the income eligibility requirements of the Low-Income Housing Tax Credit program at move-in and during any subsequent recertifications. Any additions to the household must also meet these requirements.”
Lease Term and Certification:
“The initial lease term is at least six months. The lease commencement date shall be the same as the initial certification date. Income verification must be dated within 120 days prior to the commencement of the lease.”
Recertification Process:
“Recertifications can be conducted up to 120 days prior to the anniversary date of the initial certification. The effective date of recertification shall be the anniversary date of the initial certification.”
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