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CHAPTER 3: APPLICATIONS, WAITING LIST AND TENANT SELECTION Chapter Section: 3-III Denial of Assistance
Subsection (if any): 3-III.C. Restriction of Assistance Based on Assets
CURRENT POLICY:
This is a new requirement under the Housing Opportunities Through Modernization Act (HOTMA).
PROPOSED POLICY:
3-III.C. Restriction of Assistance Based on Assets
There are two circumstances under which a family is ineligible to receive assistance based on asset ownership.
First, the family’s net assets exceed the HUD-published asset limitation amount (adjusted annually by HUD). Currently at $100k.
Second, the family has real property that is suitable for occupancy by the family as a residence and the family has:
A present ownership interest in the real property; and A legal right to reside in the real property; and
The effective legal authority to sell (based on state or local laws of the jurisdiction where the property is located) the real property.
Except If the property:
Does not meet the disability-related needs for all members of the family (e.g., physical accessibility requirements, disability-related need for additional bedrooms, proximity to accessible
transportation, etc.);
Is not sufficient for the size of the family based on subsidy standards in Chapter 8;
Is geographically located so as to be a hardship for the family (e.g., the distance or commuting time between the property and the
SUMMARY OF HOTMA CHANGES TO THE ADMIN PLAN
family's place of work or school would be a hardship to the family, as determined by the PHA or owner) defined as 50 miles; One for which the family is receiving assistance for a manufactured home under 24 CFR 982.620 or under the HCV Homeownership program;
Jointly owned by a member of the family and at least one non- household member who does not live with the family, if the non- household member resides at the jointly owned property; Is currently offering the property for sale; or
Is not safe to reside in because of the physical condition of the property (e.g., property’s physical condition poses a risk to the family’s health and safety and the condition of the property cannot be easily remedied); or
Where a family may not reside in under the state or local laws of the jurisdiction where the property is located.
-OR-
Any person who is a victim of domestic violence, dating violence, sexual assault, or stalking.
- When a family asks for an exception because a family
member is a victim of domestic violence, dating violence, sexual assault, or stalking, the PHA must comply with all the confidentiality requirements under VAWA. The PHA
must accept a self- certification from the family member, and the restrictions on requesting documentation under
VAWA apply.
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CHAPTER 6: ANNUAL INCOME
Chapter Section: 6-I.C. CALCULATING ANNUAL INCOME
Subsection (if any):
CURRENT POLICY
Basis of Annual Income Projection
The PHA generally will use current circumstances to determine anticipated income for the coming 12-month period.
PROPOSED POLICY
Anticipating Annual Income [24 CFR 5.609(c)(1)]
At initial occupancy and for an interim reexamination of family income, the PHA is required to use anticipated income (current income) for the upcoming 12-month period following the new admission or interim reexamination effective date.
Calculating Annual Income at Annual Reexamination [24
CFR.609(c)(2); Notice PIH 2023-27]
At annual reexamination, except where the PHA uses a streamlined income determination, PHAs must first determine the family’s income for the previous 12-month period and use this amount as the family income for annual reexaminations; however, adjustments to reflect current income must be made. Any change of income since the family’s last annual reexamination, including those that did not meet the threshold to process an interim reexamination of family income in accordance with PHA policies in Chapter 11 and HUD regulations, must be considered. If, however, there have been no changes to income, then the amount of income calculated for the previous 12-month period is the amount that will be used to determine the family’s rental assistance. Income from assets is always anticipated, irrespective of the income examination type.
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CHAPTER 6-I: ANNUAL INCOME
Chapter Section: 6-I.G. PERIODIC PAYMENTS
Subsection (if any):
CURRENT POLICY
Periodic payments are forms of income received on a regular basis.
(PAYMENTS RECEIVED PERIODICALLY, EVEN IF THERE WAS A
DISCRETE END DATE, WERE FORMERLY COUNTED)
Regular Contributions or Gifts
The PHA must count as income regular monetary and nonmonetary contributions or gifts from persons not residing with an assisted family [24 CFR 5.609(b)(7)]. Temporary, nonrecurring, or sporadic income and gifts are not counted as income [24 CFR 5.609(c)(9)].
PHA Policy
Examples of regular contributions include: (1) regular payment of a family’s bills (e.g., utilities, telephone, rent, credit cards, and car payments), (2) cash or other liquid assets provided to any family member on a regular basis, and (3) “in-kind” contributions such as groceries and clothing provided to a family on a regular basis.
Nonmonetary contributions will be valued at the cost of purchasing the items, as determined by the PHA. For
contributions that may vary from month to month (e.g., utility payments), the PHA will include an average amount based upon past history.
Any income received less than four times during the year will be considered temporary income and not counted.
PROPOSED POLICY
Periodic payments are forms of income received on a regular basis.
Income that will not be repeated beyond the coming year (i.e., the 12 months following the effective date of the certification), based on information provided by the family, is considered nonrecurring income and is excluded from annual income.
However, this does not include unemployment income and other types of periodic payments that are received at regular intervals.
Regular Contributions or Gifts
The PHA must count as income regular monetary contributions from persons not residing with an assisted family [24 CFR 5.609(b)(7)] that are expected to be received beyond the next reexamination year. Temporary, nonrecurring, or sporadic income and gifts are not counted as income [24 CFR 5.609(c)(9)].
PHA Policy
Examples of regular contributions include: (1) regular payment of a family’s bills (e.g., utilities, telephone, rent, credit cards, and car payments), (2) cash or other liquid assets provided to any family member on a regular basis, and (3) “in-kind” contributions such as groceries and clothing provided to a family by friends and family on a regular basis. In-kind, non-monetary contributions from a food bank or similar types of organizations are excluded from income.
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CHAPTER 6: INCOME AND ASSETS
Chapter Section: 6-II.C. ASSET INCLUSIONS AND EXCLUSIONS Subsection (if any): Necessary and Non-Necessary Personal Property
CURRENT POLICY:
Assets were not previously classified in this way as necessary and non- necessary personal property.
Recreational vehicles, extra vehicles and boats were not previously counted as assets.
Asset Exclusions [24 CFR 5.603(b)]
The value of any account under a retirement plan recognized as such by the IRS, including individual retirement arrangements (IRAs), employer retirement plans, and retirement plans for self-employed individuals [24 CFR 5.603(b)(3)(iii)] was previously counted as an asset unless the owner had no access to the account or access only through the form of a loan.
PROPOSED POLICY:
Personal property includes tangible items like boats, as well as intangible items, like bank accounts.
The value of necessary items of personal property is excluded from the calculation of net family assets.
HUD defines necessary personal property as items essential to the family for the maintenance, use, and occupancy of the premises as a home; or they are necessary for employment, education, or health and wellness.
Necessary personal property may include personal effects (such as items that are ordinarily worn or utilized by the individual), items that are convenient or useful to a reasonable existence, and items that support and facilitate daily life within the family’s home.
Necessary personal property also includes items that assist a household member with a disability, including any items related to disability-related needs, or that may be required for a reasonable accommodation for a person with a disability. Necessary personal property does not include bank accounts, other financial investments, or luxury items. Items of personal property that do not qualify as necessary personal property are classified as non-necessary personal property.
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The combined value of all non-necessary items of personal property is only included in annual income when the combined total value exceeds the HUD-published threshold amount (adjusted annually and published in HUD’s current year Inflation-Adjusted Values tables or ~$50k). When the combined value of all non-necessary personal property does not exceed this threshold amount, all non-necessary personal property is excluded from net family assets.
In determining the value of non-necessary, non-financial personal property, the PHA will use the family’s estimate of the value. The PHA may obtain an appraisal if there is reason to believe that the family’s estimated value is off by $50 or more. The family must cooperate with the appraiser but cannot be charged any costs related to the appraisal.
Non-Necessary Personal Property
- Recreational car/vehicle not needed for day-to-day transportation for personal or business use (campers, motorhomes, etc.)
- Recreational boat/watercraft
Asset Exclusions [24 CFR 5.603(b)]
The following are excluded from the calculations of net family assets:
The value of any account under a retirement plan recognized as such by the IRS, including individual retirement arrangements (IRAs), employer retirement plans, and retirement plans for self-employed individuals [24 CFR 5.603(b)(3)(iii)].
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CHAPTER 6: INCOME AND ASSETS
Chapter Section: 6-III.A. ADJUSTED INCOME
Subsection (if any): N/A
CURRENT POLICY:
Adjusted income means annual income (as determined under § 5.609) of the members of the family residing or intending to reside in the dwelling unit, after making the following deductions:
(a) Mandatory deductions
(1) $480 for each dependent;
(2) $400 for any elderly family or disabled family;
(3) The sum of the following, to the extent the sum exceeds three percent of annual income:
(i) Unreimbursed health and medical care expenses of any elderly family or disabled family;
(ii) Unreimbursed reasonable attendant care and auxiliary apparatus expenses for each member of the family who is a person with disabilities, to the extent necessary to enable any member of the family (including the member who is a person with disabilities) to be employed.
PROPOSED POLICY:
Adjusted income means annual income (as determined under § 5.609) of the members of the family residing or intending to reside in the dwelling unit, after making the following deductions:
(a) Mandatory deductions
(1) $500 for each dependent (adjusted annually by HUD, rounded to the next lowest multiple of $25);
(2) $550 for any elderly family or disabled family (adjusted annually by HUD, rounded to the next lowest multiple of $25);
(3) The sum of the following, to the extent the sum exceeds ten percent of annual income:
(i) Unreimbursed health and medical care expenses of any elderly family or disabled family;
(ii) Unreimbursed reasonable attendant care and auxiliary apparatus expenses for each member of the family who is a person with disabilities, to the extent necessary to enable any member of the family (including the member who is a person with disabilities) to be employed;
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CHAPTER 6: INCOME AND ASSETS
Chapter Section: 6-III.G. HARDSHIP EXEMPTIONS
Subsection (if any): Health and Medical Care and Disability Assistance Expenses
CURRENT POLICY:
This is a new policy section under HOTMA to include hardships caused by the increased income threshold for medical and disability expense deductions.
PROPOSED POLICY:
Health and Medical Care and Disability Assistance Expenses [24 CFR
5.611(c); Notice PIH 2023-27]
The regulations provide for two types of hardship exemption categories for families that qualify for unreimbursed health and medical care expenses and/or disability assistance expenses. A family will benefit from this hardship exemption only if the family has eligible expenses that can be deducted in excess of five percent of annual income.
Families may be eligible for relief under one of two categories; phased-in relief or general relief, as defined below.
Phased-In Relief
The first category is applicable to all families who received a deduction for unreimbursed health and medical care and/or reasonable attendant care or auxiliary apparatus expenses based on their most recent income review prior to January 1, 2024. The family must receive phased-in relief if they are determined to be eligible. These families will begin receiving a 24- month phased-in relief at their next annual or interim reexamination, whichever occurs first, after the date on which the PHA implements phased-in relief.
For these families, the threshold amount is phased-in as follows:
The family is eligible for a deduction totaling the sum of expenses that exceeds 5 percent of annual income for the first 12 months.
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At the conclusion of 12 months, the family is eligible for a deduction totaling the sum of their expenses that exceed 7.5 percent of annual income for another 12 months.
At the conclusion of 24 months, the standard threshold amount of 10 percent would be used, unless the family qualifies for relief under the general hardship relief category.
When an eligible family’s phased-in relief begins at an interim reexamination, the PHA must process another transaction (either an interim reexamination or non-interim transaction, as applicable) one year later to move the family to the next phase.
Prior to the end of the 24-month period, the family may request a hardship exemption under the second category as described below. If the family is found eligible under the second category, the hardship exemption under the first category ends, and the family’s hardship is administered in accordance with the requirements listed below. Once a family requests general relief, the family may no longer receive phased-in relief.
General Relief
The second category is for families that can demonstrate:
Their health and medical and/or disability assistance expenses increased (other than the transition to the higher threshold); or The family’s financial hardship is a result of a change in circumstances (as defined in PHA policy) that would not otherwise trigger an interim reexamination.
The family may request a hardship exemption under the second category regardless of whether the family previously received the health and medical and/or disability assistance deductions or are currently or were previously receiving relief under the phased-in relief category above.
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PHA Policy
To qualify for a hardship exemption, a family must submit a request in writing. The request must show that the family’s health and medical and/or disability assistance expenses have increased (other than the transition to the higher threshold) and that the family’s financial hardship is a result of a change in circumstances.
The PHA defines a change in circumstances as a decrease in income or increase in other expenses that has resulted in the family’s financial hardship but does not, on its own, trigger an interim reexamination in accordance with PHA policies.
Examples of circumstances constituting a financial hardship may include the following situations:
The family is awaiting an eligibility determination for a federal, state, or local assistance program, such as a determination for unemployment compensation or disability benefits;
The family’s income decreased because of a loss of
employment, death of a family member, or due to a natural or federal/state declared disaster; or
Other circumstances as determined by the PHA.
The family must provide third-party verification of the hardship with the request. If third-party verification is not available, the PHA will document the file with the reason and will attempt to obtain third-party verification prior to the end of the 90-day hardship exemption period.
PHA Policy
The PHA will make a determination of whether the family qualifies within 30 calendar days and will notify the family in writing of the result within 10 business days of the determination.
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If the PHA denies the hardship exemption request, the PHA notice will also state that if the family does not agree with the PHA determination, the family may request a hearing.
If the family qualifies for an exemption, the PHA will include the date the hardship exemption will begin and the date it will expire as well as information on how to request a 90-day extension based on family circumstances.
If the family qualifies, the family will receive a deduction for the sum of eligible expenses that exceed five percent of annual income.
The family’s hardship relief ends when the circumstances that made the family eligible for the relief are no longer applicable or after 90 days, whichever is earlier. However, the PHA may, at its discretion, extend the relief for one or more additional 90-day periods while the family’s hardship condition continues. PHAs are not limited to a maximum number of 90-day extensions.
PHA Policy
The family may request an extension in writing prior to the end of the hardship exemption period. The PHA will extend relief for an additional 90-days if the family demonstrates to the PHA’s satisfaction that the family continues to qualify for the hardship exemption based on circumstances described above. The PHA will require updated verification based on the family’s current circumstances. Additional extension(s) may be granted on a case- by-case basis provided the family continues to request extensions prior to the end of each hardship exemption period. Families must report if the circumstances that made the family eligible for the hardship exemption are no longer applicable. At any time, the PHA may terminate the hardship exemption if the PHA determines that the family no longer qualifies for the exemption.
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CHAPTER 6: INCOME AND ASSETS
Chapter Section: 6-III.G. HARDSHIP EXEMPTIONS
Subsection (if any): Childcare Expense Hardship Exemption
CURRENT POLICY:
This is a new policy section under HOTMA.
PROPOSED POLICY:
6-III.G. HARDSHIP EXEMPTIONS
A family whose eligibility for the childcare expense deduction is ending may request a financial hardship exemption to continue receiving the deduction. If the family demonstrates to the PHA’s satisfaction that the family is unable to pay their rent because of the loss of the childcare expense deduction, and that the childcare expense is still necessary even though the family member is not working, looking for work, or seeking to further their education, the PHA must recalculate the family’s adjusted income and continue the childcare deduction.
PHA Policy
For a family to qualify, they must demonstrate that their inability to pay rent would be as a result of the loss of this deduction. The PHA defines this hardship as a potential decrease in income or increase in other expenses that would result from the loss of the childcare expense and such loss would impact the family’s ability to pay their rent.
Some factors to consider when determining if the family is unable to pay rent may include determining that the rent, utility payment, and applicable expenses (childcare expenses or health and medical expenses) are more than 40 percent of the family’s adjusted income, or verifying whether the family has experienced unanticipated expenses, such as large
medical bills, that have affected their ability to pay their rent.
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The family must also demonstrate that the childcare expense is still necessary even though the family member is no longer employed or furthering their education. The PHA will consider qualification under this criterion on a case-by-case basis (for example, if the family member who was employed has left their job in order to provide uncompensated care for an elderly friend or family member who is severely ill and lives across town).
The family must provide third-party verification of the hardship with the request. If third-party verification is not available, the PHA will document the file with the reason and will attempt to obtain third-party verification prior to the end of the 90-day hardship exemption period.
result from the loss of the childcare expense and such loss would impact the family’s ability to pay their rent.
The PHA must promptly notify the family in writing of the change in the determination of adjusted income and the family’s rent resulting from hardship exemptions.
If the PHA denies the request, the notice must specifically state the reason for the denial. PHAs must provide families with 30 days’ notice of any increase in rent.
If the PHA approves the request, the notice must inform the family of when the hardship exemption will begin and expire [24 CFR
5.611(e)(2)]. The notice must also state the requirement for the family to report to the PHA if the circumstances that made the family eligible for relief are no longer applicable and that the family’s adjusted
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income and tenant rent will be recalculated upon expiration of the hardship exemption [Notice PIH 2023-27].
PHA Policy
The PHA will make a determination of whether the family qualifies within 30 calendar days and will notify the family in writing of the result within 10 business days of the
determination.
If the PHA denies the hardship exemption request, the
PHA notice will also state that if the family does not
agree with the PHA determination, the family may
request an informal hearing.
If the family qualifies for an exemption, the PHA will
include all required information listed above as well
as information on how to request a 90-day extension
based on family circumstances.
If the family qualifies, the hardship exemption and the resulting alternative adjusted income calculation must remain in place for a period of up to 90 days.
The PHA may, at its discretion, extend the hardship exemptions for additional 90-day periods based on family circumstances and as stated in PHA policies. PHAs are not limited to a maximum number of 90-day extensions. PHAs must develop policies requiring families to report if the circumstances that made the family eligible for the hardship exemption are no longer applicable.
PHAs must promptly notify families in writing if they are denied either an initial hardship exemption or an additional 90-day extension of the exemption. If the PHA denies the request, the notice must specifically state the reason for the denial.
PHAs must notify the family if the hardship exemption is no longer necessary and the hardship exemption will be terminated because the circumstances that made the family eligible for the exemption are no
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longer applicable. The notice must state the termination date and provide 30 days’ notice of rent increase, if applicable.
PHA Policy
The family may request an extension in writing prior to the end of the hardship exemption period. The PHA will extend relief for an additional 90-days if the family demonstrates to the PHA’s satisfaction that the family continues to qualify for the hardship exemption. The PHA will require updated
verification based on the family’s current circumstances.
Additional extensions may be granted on a case-by-case basis provided the family continues to request extensions prior to the end of each hardship exemption period. Families must report if the circumstances that made the family eligible for the hardship exemption are no longer applicable. At any time, the PHA may terminate the hardship exemption if the PHA determines that the family no longer qualifies for the
exemption.
CHAPTER 7: VERIFICATION
Chapter Section: 7-I.A. FAMILY CONSENT TO RELEASE INFORMATION Subsection (if any): Preferences
CURRENT POLICY:
Consent Forms
This is a new policy and procedure to align with HOTMA. Typically, the PHA would not send EIV income information to the household by mail, however now the PHA is expected to have the household review EIV information and confirm or deny its accuracy.
PROPOSED POLICY:
Consent Forms
PHA Policy
The PHA will request that all adult family members (other than the head of household) provide consent to share their EIV income information with the head of household.
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If an adult family member other than the head of household declines to provide consent, the PHA will generate income reports addressed separately to each adult in the household.
The consent will remain effective until the family’s assistance is terminated, the individual leaves the program, or the family member provides written notification to the PHA to revoke consent.
CHAPTER 7: VERIFICATION
Chapter Section: 7-I.D. VERIFICATION HIERARCHY
Subsection (if any): N/A
CURRENT POLICY:
Highest: Level 6: Up-front Income Verification (UIV) using HUD’s Enterprise Income Verification (EIV) system
Highest: Level 5: Up-front Income Verification (UIV) using a non-EIV system
High: Level 4:
- Written third-party verification from the source, also known as “family-provided verification”
Medium: Level 3: Written third-party verification form Medium: Level 2: Oral third-party verification
Low: Level 1: Self-certification (not third-party verification)
PROPOSED POLICY:
Highest: Level 6: Up-front Income Verification (UIV) using HUD’s Enterprise Income Verification (EIV) system
Highest: Level 5: Up-front Income Verification (UIV) using a non-EIV system
High: Level 4:
- Written third-party verification from the source, also known as “family-provided verification”
- Or EIV plus self-certification
Medium: Level 3: Written third-party verification form Medium: Level 2: Oral third-party verification
Low: Level 1: Self-certification (not third-party verification)
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Any documents used for verification must be the original (not photocopies) and generally must be dated within 60 days of receipt by the PHA, or up to 120 days if they are the most current verifications available. Statements dated within the appropriate benefit year are acceptable for fixed sources of income. The documents must not be damaged, altered or in any way illegible
Any documents used for verification must be the original (not photocopies) and generally must be dated within 120 days of receipt by the PHA.
Statements dated within the appropriate benefit year are acceptable for fixed sources of income. The documents must not be damaged, altered or in any way illegible
CHAPTER 7: VERIFICATION
Chapter Section: 7-I.E. LEVELS 5 AND 6 VERIFICATIONS: UP FRONT INCOME VERIFICATION (UIV) Subsection (if any): EIV Income Report
CURRENT POLICY:
The EIV Income Report may be between 3 and 6 months old at the time the reports are generated.
EIV could not previously be used to calculate income from wages.
PROPOSED POLICY:
When required to use the EIV Income Report, the PHA must pull the report within 120 days of the effective date of the annual reexamination in order for the report to be considered current.
The EIV Income Report may be used to verify and calculate income at annual reexamination if the family self-certifies that the amount is accurate and representative of current income. The family must be provided with the information in EIV.
CHAPTER 7: VERIFICATION
Chapter Section: 7-I.F. LEVEL 4 VERIFICATION
Subsection (if any): EIV + Self-Certification
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CURRENT POLICY:
This is a new policy under HOTMA.
PROPOSED POLICY:
EIV may be used as written third-party verification and may be used to calculate income if the family agrees with the information in EIV and self-certifies that the amount is accurate and
representative of current income. This practice is known as EIV + self-certification.
PHA Policy
At annual reexamination, if the PHA does not use a
determination of income from a means-tested federal
assistance program and if there are no reported changes to an income source, the PHA may use EIV + self-certification as verification of employment income, provided the family
agrees with the amounts listed in EIV.
Generally, the PHA will use an average of the last two
quarters of income listed in EIV to determine income from employment. The PHA will provide the family with the
information in EIV. The family member will be required to sign a self-certification stating that the amount listed in EIV is accurate and representative of current income.
If the family member disagrees with using only the last two quarters of income listed in EIV, the family member may request that the PHA use an average of the last four quarters.
The request must provide an explanation of why the last four quarters are more accurate and representative of the current annual income. If approved, the PHA will use the average of the last four quarters to calculate annual income.
If the family member disagrees and contends that the amount listed in EIV is not reflective of current income, or if less than
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two quarters are available in EIV, the PHA will use written third-party verification from the source as outlined below.
CHAPTER 7: VERIFICATION
Chapter Section: 7-I.G. LEVEL 4 VERIFICATION: WRITTEN, THIRD-PARTY FORM Subsection (if any):
CURRENT POLICY:
This previous policy did not allow the PHA to skip this step and use level 2 verifications in lieu of this step. This is a new addition under HOTMA.
PROPOSED POLICY:
This type of verification is a form developed by the PHA and used uniformly for all families when needed to collect information from a third-party source. This is known as “traditional third-party verification.” PHAs send a PHA-developed form directly to the third-party source by mail, fax, or email and the source completes the form by hand (in writing or typeset).
PHA Policy
In general, the PHA will attempt to send written third-party verification forms to the verification source whenever higher forms of verification are unavailable.
However, on a case-by-case basis, the PHA may choose to obtain oral third-party verification without first attempting, and in lieu of, a written-third party verification form.
CHAPTER 7: VERIFICATION
Chapter Section: 7-II.B. SOCIAL SECURITY NUMBERS
Subsection (if any):
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CURRENT POLICY:
This previous policy did not allow the PHA to self-certify a Social Security Number. This is a new addition under HOTMA.
PROPOSED POLICY:
While PHAs must attempt to gather third-party verification of SSNs prior to admission as listed above, PHAs also have the option of accepting a self- certification and a third-party document (such as a bank statement, utility or cell phone bill, or benefit letter) with the applicant’s name printed on it verifying an individual’s SSN using this method, the PHA must document why the other SSN documentation was not available [Notice PIH 2023-27]. to satisfy the SSN disclosure requirement if the PHA has exhausted all other attempts to obtain the required documentation. If the tenant’s SSN is verified in EIV, then no further verification is required. If the tenant’s SSN fails the SSA identity match, the PHA must obtain a valid SSN card issued by the SSA or an original document issued by a federal or state government agency that contains the name and SSN of the individual, along with other identifying information of the individual. The tenant’s assistance must be terminated if they fail to provide the required documentation.
PHA Policy
The PHA will verify an individual’s SSN in the situations described above using the method described above as a last resort when no other forms of verification of the individual’s SSN are available.
CHAPTER 7: VERIFICATION
Chapter Section: 7-III.E. NONRECURRING INCOME
Subsection (if any):
CURRENT POLICY:
The previous policy defined nonrecurring income as income received less than four times per year. This is a new definition under HOTMA.
PROPOSED POLICY:
Income that will not be repeated beyond the coming year (i.e., the 12 months following the effective date of the certification), based on information provided by the family, is considered nonrecurring income and
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is excluded from annual income. PHAs may accept a self-certification from the family stating that the income will not be repeated in the coming year.
PHA Policy
The PHA will accept self-certification from the family stating that income will not be repeated in the coming year. However, the PHA may, on a case- by-case basis, require third-party verification that income sources will not be repeated in the coming year.
CHAPTER 7: VERIFICATION
Chapter Section: 7-III.F. ASSETS AND INCOME FROM ASSETS Subsection (if any): Net Family Assets
CURRENT POLICY:
In determining the value of checking account, the PHA will use, at minimum, the average monthly balance for the last two months.
The PHA may request additional bank statements if the
statements indicate discrepancies or possible unreported income.
If this occurs, the PHA will use the average monthly balance of all of the statements that were received.
In determining the value of a savings account, the PHA will use the current balance.
In determining the anticipated income from an interest-bearing checking or savings account, the PHA will multiply the current value of the account by the current rate of interest paid on the account.
PROPOSED POLICY:
At admission and reexamination, for families with net assets less than or equal to the HUD-published threshold listed in HUD’s current year Inflation-Adjusted Values tables ($52,787 for 2026), the PHA may, but is not required to, accept the family’s self-certification that the family’s assets do not exceed the HUD-published threshold without taking any additional steps to verify the accuracy of the declaration.
For PHAs that choose to accept self-certification, the PHA is required to obtain third-party verification of all assets, regardless of the amount, at least once every three years.
When net family assets have a total net value over the HUD-published threshold, the PHA may not rely on the family’s self-certification. Third- party verification of assets is required when net family assets exceed the HUD-published threshold.
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As allowed by HUD, the PHA will accept the self-certification of the family and will not require additional verification if the total value of the family’s net assets is equal to or less than $5,000.
The cash value of real property or other assets with negative equity would be considered $0 for the purposes of calculating net family assets [Notice PIH 2023-27].
PHA Policy
For participating families with net assets less than or equal to the HUD-published threshold listed in the current year’s Inflation- Adjusted Values tables, the PHA will accept the family’s self- certification of the value of family assets and anticipated asset income. The family’s declaration must show the total amount of income expected from all assets. All family members 18 years of age and older must sign the family’s declaration. The PHA reserves the right to require additional verification in situations where the accuracy of the declaration is in question. Any income the family expects to receive from assets will be included in the family’s annual income. The PHA will obtain third-party verification of net family assets every three years. The PHA may, at its discretion, obtain verification of certain assets more frequently.
The PHA will require the family to provide the current checking and savings account statement to verify the interest rate.
The PHA will not accept self-certification of the value of family assets and anticipated asset income at new admission and will require third-party verification of all assets.
When verification is required in determining the value of checking account, the PHA will use, at minimum, the average monthly balance for the last two months (using the most current statement). The PHA may request additional bank statements if the statements indicate discrepancies or possible unreported income.
If this occurs, the PHA will use the average monthly balance of all of the statements that were received.
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In determining the value of a savings account, the PHA will use the current balance.
In determining the anticipated income from an interest-bearing checking or savings account, when verification is required and the rate of return is known, the PHA will multiply the current value of the account by the current rate of interest paid on the account. If a checking account does not bear interest, the anticipated income from the account is zero.
Self-Certification of Real Property Ownership [24 CFR 5.618(b)(2); Notice PIH 2023-27]
PHA Policy
The PHA will accept self-certification, in a format acceptable to the PHA, from the family stating that the family does not have any present ownership in any real property. The certification must be signed by all family members 18 years of age and older. The PHA reserves the right to require additional verification in situations where the accuracy of the declaration is in question.
If the family declares they have present ownership in real property, the PHA will obtain third-party verification of the following factors:
whether the family has the legal right to reside in the property; whether the family has effective legal authority to sell the property; and whether the property is suitable for occupancy by the family as a residence. However, in cases where a family member is a victim of domestic violence, dating violence, sexual assault, stalking, or human trafficking, the PHA will comply with confidentiality requirements under 24 CFR 5.2007 and will accept a self-certification.
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CHAPTER 7: VERIFICATION
Chapter Section: 7-III.J. INCOME FROM RETIRMENT ACCOUNTS Subsection (if any):
CURRENT POLICY:
The PHA will accept written third-party documents supplied by the family as evidence of income from retirement accounts.
The type of original document that will be accepted depends upon the family member’s retirement status.
Before retirement, the PHA will accept an original
document from the entity holding the account with a
date that shows it is the most recently scheduled
statement for the account, but in no case earlier than 6 months from the effective date of the examination.
Upon retirement, the PHA will accept an original
document from the entity holding the account that
reflects any distributions of the account balance, any
lump sums taken and any regular payments.
After retirement, the PHA will accept an original
document from the entity holding the account dated no
earlier than 12 months before that reflects any
distributions of the account balance, any lump sums
taken and any regular payments.
PROPOSED POLICY:
The PHA will accept written third-party documents supplied by the family as evidence of income from retirement accounts.
The type of original document that will be accepted depends upon the family member’s retirement status.
Upon retirement, the PHA will accept an original document from the entity holding the account that reflects any
distributions of the account balance, any lump sums taken and any regular payments.
After retirement, the PHA will accept an original document from the entity holding the account dated no earlier than 12 months before that reflects any distributions of the account balance, any lump sums taken and any regular
payments.
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CHAPTER 11: INTERIM REEXAMINATIONS
Chapter Section: 11-II.C. CHANGES AFECTING INCOME OR EXPENSES Subsection (if any):
CURRENT POLICY
The PHA will conduct an interim reexamination for all household composition changes, income decreases, other changes that would result in a lower tenant rent payment and when requested by the family. The PHA will not conduct interim reexaminations for income increases.
Interims may be conducted at any time, regardless of the time when the annual reexamination occurs.
Reporting
HUD regulations give the PHA the freedom to determine the circumstances under which families will be required to report changes affecting income.
PHA Policy
Families who report zero income must report a change in income within ten (10) business days of the change. The PHA will conduct an interim re-examination to reflect the addition of income to the household. The increase will be effective on the first of the month following a 30 days’ notice to the family. Please refer to Chapter 5-I.C. for additional policies regarding families that report zero income.
Families are not required to report any other changes in income or expenses that occur throughout the year as long as they have provided complete and accurate information during their regular reexamination.
PROPOSED POLICY:
The PHA must estimate the income of the family for the upcoming 12- month period to determine family income for an interim reexamination [24 CFR 5.609(c)(1)]. Policies for projecting income are found in Chapter 6.
PHA Policy
The PHA will not conduct an interim reexamination when the family reports a change that would result in an increase within 90 days of their regular annual reexamination.
Interim Decreases [24 CFR 982.516(c)(2) and Notice PIH 2023-27] PHA Policy
Generally, the PHA will only conduct an interim when the family’s adjusted income has decreased by an amount that is 10 percent or more of the family’s adjusted income.
When determining the 10 percent threshold, the PHA will round calculated percentages up or down to the next nearest unit as applicable (e.g., a calculated decrease of 9.5 percent will be rounded to 10 percent).
However, the PHA will perform an interim reexamination for a decrease in adjusted income of any amount in two circumstances:
When there is a decrease in family size attributed to the death of a family member; or
When a family member permanently moves out of the
assisted unit during the period since the family’s last reexamination.
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Optional Reporting
The family may request an interim reexamination any time the family has experienced a change in circumstances since the last determination. The PHA must process the request if the family reports a change that will result in reduced family income.
PHA Policy
If a family reports a change that was not required to report and that would result in an increase in the family share of the rent, the PHA will note the information in the tenant file but will not conduct an interim reexamination.
Families participating in the FSS program may request an interim reexamination to reflect an increase in earned income. Upon request, the PHA will process the interim reexamination for FSS program purposes.
Families may report changes in income or expenses at any time.
Interim Increases [24 CFR 982.516(c)(3) and Notice PIH 2023-27] Increases Less than 10 Percent
PHAs must not process interim reexaminations for income increases that result in less than a 10 percent increase in annual adjusted income.
Increases 10 Percent or Greater
PHAs must conduct an interim reexamination of family income when the PHA becomes aware that the family’s adjusted income has changed by an amount that the PHA estimates will result in an increase of 10 percent or more in adjusted income, with the following exceptions:
PHA Policy
The PHA will not conduct interim increases in earned income. The PHA will conduct interim increases for unearned income if the 10% threshold has been met.
PHA Policy
Families who report zero income must report a change in income within ten (10) business days of the change. The PHA will conduct an interim re-examination to reflect the addition of income to the household. The increase will be effective on the first of the month following a 30 days’ notice to the family. Please refer to Chapter 5- I.C. for additional policies regarding families that report zero income.
Cumulative Increases [Notice PIH 2023-27]
A series of smaller reported increases in adjusted income may cumulatively meet or exceed the 10-percent increase threshold, at which point the PHA must conduct an interim reexamination in accordance with PHA policy.
Family Reporting
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When the PHA determines that an interim reexamination of income is necessary, they must ask the family to report changes in all aspects of adjusted income and other family circumstances. For example, if the family is reporting a decrease in adjusted income that is more than 10 percent, but the family also had a change in assets that would result in a change in income, the change in assets must also be reviewed [Notice PIH 2023-27].
PHA Policy
Families must report all changes to income, assets, expenses and household composition, regardless of whether the change will result in an interim.
If a family reports a change that was not required to report and that would result in an increase in the family share of the rent, the PHA will note the information in the tenant file but will not conduct an interim reexamination.
CHAPTER 11: INTERIM REEXAMINATIONS
Chapter Section: 11-II.D. EFFECTIVE DATES
Subsection (if any):
CURRENT POLICY:
The PHA must establish the time frames in which any changes that result from an interim reexamination will take effect [24 CFR 982.516(e)]. The changes may be applied either retroactively or prospectively, depending on whether there is to be an increase or a decrease in the family share of the rent, and whether the family reported any required information within the required time frames [HCV GB, p. 12-10].
PHA Policy
If the family share of the rent is to increase:
PROPOSED POLICY:
Changes Reported Timely [Notice PIH 2023-27]
If the family reports a change in family income or composition timely in accordance with PHA policies:
For rent increases, the PHA must provide the family with 30 days advance written notice. The rent increase is effective the first of the month after the end of that 30-day notice period.
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The increase generally will be effective on the first of the month following 30 days’ notice to the family.
If a family fails to report a change within the required time frames, or causes a delay in processing the
interim reexamination, increases in the family share
of the rent will be applied retroactively, to the date it would have been effective had the information been
provided on a timely basis. The family will be
responsible for any overpaid subsidy and may be
offered a repayment agreement in accordance with
the policies in Chapter 16.
If the family share of the rent is to decrease:
The PHA will process decreases received by 10
th of
the month or the first business day following the 10th
of the month in priority order. However, no changes
will be made until all verifications are provided.
Requests received by the 10
th of the month will be
effective on the first day of the month following the
month in which the request was made provided that
all documentation requirements are met.
Requests submitted after the 10th of the month are
generally delayed by one month.
Any changes that are reported as part of, or
concurrent with, an annual reexamination process
will be made effect with the annual reexamination.
If the family causes a delay in processing the interim
reexamination, decreases in the family share of the
rent will be applied prospectively, from the first day
Rent decreases are effective on the first of the month after the date of the actual change leading to the interim reexamination of family income. This means the decrease will be applied retroactively.
Changes Not Reported Timely [Notice PIH 2023-27]
If the family failed to report a change in family income or composition timely in accordance with PHA policies:
For rent increases, the PHA must implement any resulting rent increases retroactively to the first of the month following the date of the change leading to the interim reexamination of family income. For rent decreases, the PHA must implement the change no later than the first rent period following completion of the interim reexamination.
PHA Policy
In general, when the family fails to report a change in income or family composition timely, and the change would lead to a rent decrease, the PHA will apply the decrease the first of the month following completion of the interim reexamination.
However, the PHA will apply the results of the interim
reexamination retroactively where a family’s ability to report a change in income promptly may have been hampered due to extenuating circumstances such as a natural disaster or disruptions to PHA management operations. The PHA will decide to apply decreases retroactively on a case-by-case basis.
When the PHA applies the results of interim increases
retroactively, the PHA will clearly communicate the effect of the retroactive adjustment to the family and may enter into a repayment agreement in accordance with PHA policies.
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of the month after all verification of income has been
obtained.
Documents requested by the PHA in support of a
decrease must be submitted within 10 business days
of the request. The PHA may grant an extension for
circumstances beyond the control of the family.
However, if the family is not responsive to a request
for documentation, the PHA will consider the request
for a decrease cancelled. The PHA will consider the
family nonresponsive if more than 10 business days
have lapsed since the deadline for the information
and the family has not had any communication with
the PHA. In such cases, the family will be advised
that the PHA is not processing the decrease and must
start the process over again if they wish to receive the decrease.
Delays in reexamination processing are considered to be caused by the family if the family fails to provide
information requested by the PHA by the date specified, and this delay prevents the PHA from completing the
reexamination as scheduled.
The PHA will also clearly communicate the effect of the retroactive adjustment to the owner.
CHAPTER 11: INTERIM REEXAMINATIONS
Chapter Section: 11-III NON-INTERIM REEXAMINATION TRANSACTIONS Subsection (if any):
SUMMARY OF HOTMA CHANGES TO THE ADMIN PLAN
CURRENT POLICY:
This is a new policy and procedure under HOTMA.
PROPOSED POLICY:
Families may experience changes within the household that do not trigger an interim reexamination under PHA policy and HUD regulations, but which HUD still requires the PHA to report to HUD via Form HUD-50058. These are known as non-interim reexamination transactions. In these cases, PHAs will submit a separate, new action code on Form HUD-50058. The following is a list of non-interim reexamination transactions:
Adding or removing a hardship exemption for the childcare expense deduction;
Updating or removing the phased-in hardship relief for the health and medical care expense deduction and/or reasonable attendant care and auxiliary apparatus expense deduction (families will begin receiving a 24-month phased-in relief at their next annual or interim reexamination, whichever occurs first);
Adding or removing general hardship relief for the health and medical care expense deduction and/or reasonable attendant care and auxiliary apparatus expense deduction;
Adding or removing a minimum rent hardship;
Adding or removing a non-family member (i.e., live-in aide, foster child, foster adult);
Ending a family’s EID or excluding 50 percent (decreased from 100 percent) of a family member’s increase in employment income at the start of the second 12- month EID period.
Adding a family member and the increase in adjusted income does not trigger an interim reexamination under the final rule;
Removing a family member and the increase in adjusted income does not trigger an interim reexamination under the final rule;
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Adding/updating a family or household member’s Social Security number;
Updating a family member’s citizenship status from eligible to ineligible or vice versa, resulting in a change to the family’s rent and/or utility reimbursement, if applicable (i.e., family begins receiving prorated assistance or previously prorated assistance becomes full assistance), or updating the prorated rent calculation due to the addition or removal of family members in household with an ineligible noncitizen(s); and
Rent increases
PHAs must make all other changes to assets, income, and deductions at the next annual or interim reexamination of income, whichever is sooner.