Section 42 refers to that section of the tax code which provides tax credits to investors who build or rehabilitate affordable housing. Investors receive a reduction in their tax liability in return for providing affordable housing to people with fixed or lower incomes. To receive these reductions, the owner(s) must annually certify that the residents are qualified under the Program requirements and are paying the correct amount of rent.
BENEFITS FOR RESIDENTS
The benefits for the residents of these properties with this particular type of financing is that the apartments are new or renovated and have rents usually lower than the market rate. The rents are no higher than 30% of the area median income as published by HUD, often resulting in rents lower than other comparable apartments
DIFFERENCES FROM OTHER HOUSING PROGRAMS
This Program is not a subsidized housing program or Section 8 housing. All residents are responsible for the full amount of rent each month. The rental amount is NOT based on your individual household income; it is determined by the owner, based on HUD guidelines and is updated annually.
MAXIMUM RENT LIMITS (max rents no more than 30% of max income limit of 60%)
0 1 2 3 4 5 �
60% $849 $909 $1092 $1262 $1407 $1553
WHAT WILL BE EXPECTED OF TENANTS
Residents who live in Section 42 units must be income and program eligible similar to residents who live in rental assistance developments. You will be asked to complete forms annually that request information regarding your income(monies received regularly including employment, SSI, pensions, child support, etc), family size and financial assets(checking/savings, certificates of deposits, stocks/bonds, real estate, etc). If you have a change in household composition you will be required to notify management immediately and will be required to complete the certification process again.
MAXIMUM INCOME LIMITS (60% of the average household median income)
1 2 3 4 5 6 �
60% $33,960 $38,820 $43,680 $48,540 $52,440 $56,280