Effective Immediately: REAC and LIHTC Audit Changes

For REACs:

Please be advised that HUD has released the following statement, contained in HUD Notice PIH-2019-02 (HA)  H-2019-04  (Issued 2/22/2019): 

“Beginning 30 days after publication of this notice, HUD employees and contract inspectors acting on behalf of HUD shall provide to POAs 14 calendar days of notification prior to a REAC inspection. Any inspections that would fall on a federal holiday will be scheduled for the next business day.” 

Inspections that have already been scheduled are not affected.

The full notice may be read here: https://www.hud.gov/sites/dfiles/PIH/documents/PIH-2019-02.pdf

For LIHTC Audits:

Please be advised that the IRS has issued the following final regulation (and removal of temporary regulation) regarding the following audit procedures: 

  1. Require Credit agencies to inspect at least as many units as specified by project size in the Low Income Housing Credit Minimum Unit Sample Size Reference Chart (contained in (§1.42-5(c)(2)(iii)).  Previously credit (state) agencies could inspect the lesser of this number or 20% of units.
  2. Shorten the reasonable notice requirement to 15 days in advance of when a project will experience a physical inspection or review of low-income certification

The full notice may be read here:  https://www.neahma.org/wp-content/uploads/Amendments-to-the-Low-Income-Housing-Credit-Compliance-Monitoring-Regulations.pdf