According to HUD 4350.3 Chapter 5-17, verifications are valid for 120 days from the date the documents were received by the leasing office. However, the IRS 8823 audit guide states that verification must not be older than 120 days from before the effective certification date. The best practice is to follow the most restrictive rule. For an example, watch the following quick tip video:

The LIHTC and HOME programs are vital affordable housing programs that allocate funds and tax incentives to create affordable housing for low-income American families. Whereas the LIHTC program primarily provides tax credit incentives to property owners, developers, and lenders to invest in and construct affordable housing for low-income families, the HUD HOME program funds are used for various housing ventures—based on local housing needs. HOME funds are used to render funds to tenant-based rental assistance, housing rehabilitation, and new housing construction (including site acquisition, improvements, demolition, etc.). All housing developed with HOME funds must serve low-and very low-income families. There are also different rules governing tenant eligibility, verification and re-certification guidelines, and rent limits.

The Housing Choice Voucher program, also called Section 8, is a federal program to assist very low-income families, elderly, and disabled people in affording decent, safe, and sanitary housing. HUD allots federal funds to state housing agencies who administer housing choice vouchers on a local level to individuals or families. When a housing voucher is issued, the individual or family is responsible to find a suitable housing unit that coincides with a property owner’s willingness to rent under the program. Eligibility for the program is determined by the state housing agency and based on the family annual gross income and family size. The family’s income may not exceed 50 percent of the median income for the residing county or city. Median income levels vary by location. Once the state housing agency approves a potential housing unit selected by the family, a lease is signed by property management and the family and a housing assistance payment contract is signed between property management and the state housing agency.

Household assets include anything that has value (e.g., savings accounts, checking accounts, stocks, bonds, 401(k), IRA, mutual funds, etc.). Generally, if the sum of household assets exceeds $5,000, the assets must be verified by a third-party (e.g., lending institutions, etc.). If the household assets are below $5,000, you do not need to verify. However, be aware that some programs may have restrictive rules that require verification of all assets, regardless of the total value. Your portfolio manager can advise you on specific income verification rules for your property.