LIHTC Essentials-HOTMA Resource - Key Upcoming Changes 8.18.27

HOTMA Resource - Key Upcoming Changes 8.18.27

Pdf Summary

HOTMA compliance becomes mandatory by January 1, 2027, and agencies may need to begin using the new rules as early as September 2026 because reexaminations are often processed 90–120 days in advance.<br /><br />Key eligibility rule: a family is ineligible if its net assets exceed the statutory limit for 2027 ($109,797, adjusted annually) or if it owns disqualifying real property that it could live in and sell. Certain assets are excluded, including retirement accounts and education savings accounts. At admission, agencies must deny applicants over the limit. At recertification, agencies may choose full enforcement, limited enforcement with up to 6 months to cure, or no enforcement.<br /><br />Annual reexams use a three-step look-back process. Agencies first review EIV income data, the most recent HUD-50058/50059, and the family’s prior-year certification. If nothing changed, that income may be used. If an interim reexam occurred and nothing else changed, the interim income can be reused. Otherwise, the family’s prior-year income is compared to current information, and verification is required if there are changes or discrepancies.<br /><br />Income from assets is always anticipated, and SSA/SSI COLAs must be applied to reexams effective January 1 or later. For 2027, the inflationary asset threshold is $54,898 and the passbook rate is 0.38%. Households at or below the asset threshold may self-certify asset values.<br /><br />Several deductions are inflation-adjusted for 2027, including the dependent deduction ($525) and elderly/disabled family deduction ($575). Medical/disability deductions now generally apply only to expenses above 10% of annual income, though some households transition through a 24-month phased-in relief schedule. General hardship relief may allow deductions above 5% for renewable 90-day periods.<br /><br />For interim reexams, most income changes require one only if they exceed a PHA-set threshold up to 10% of adjusted income. Household composition changes always require an interim reexamination. Some changes are handled only at the next annual or qualifying interim reexam, not as non-interim transactions.

Keywords

HOTMA compliance

January 1 2027

asset limit

reexaminations

eligibility rules

HUD-50058

income verification

asset threshold

medical deductions

interim reexamination