Lihtc Carryover Allocation Agreement

(1) In general. Subject to limitations in paragraph (b) paragraph 2 of this section, the basis of a taxpayer in a project as defined in Section 42 (h) (e) (e) (e) (ii) or (F) (transfer basis) is the taxpayer`s adjusted basis for depreciable land or land, which can reasonably be expected to be considered part of the project , whether or not these amounts are questioned in the eligible base under Section 42 D. For example, if the project is to include real estate that is not residential buildings, such as commercial spaces. B, the base for allocating the commercial area, even if it is not included in the eligible base, is included in the transfer base. The suitable base of the land and depreciable land is determined in sections 1012 and 1016 and generally includes the direct and indirect costs associated with the acquisition, construction and reclamation of the land. Costs that otherwise do not need to be refined in the transfer base are not excluded, as they were incurred prior to the calendar year in which the transfer is made. A: If you fail one of the two requirements mentioned above, your project will not have a valid transfer assignment. In the absence of a valid transfer, your investor and lender will most likely revoke their commitments and effectively execute the agreement. This is why the 10% test is sometimes called a threshold test. While your National Housing Finance Agency (HFA) allows the full six months to complete the test, others are not as generous. An HFA may be more restrictive than federal rules when it comes to managing the allocation process within its state. A: The 10 percent test is a fraction calculated as follows. The numerator is the taxpayer-appropriate basis for depreciable land and land, which is reasonably expected to be part of the project at the time of the measure, which will be determined by the HFA.

The denominator is the taxpayer`s adjusted basis for farm and depreciable land, which is reasonably expected to be part of the project at the end of the second year following the award year. Note that the description of the counter or denominator does not mention the eligible base. Therefore, each commercial element of the project covers costs in both cases.