News

HUD Notice on Violence Against Women Act of 2013

On August 6, 2013, HUD published a Notice titled The Violence Against Women Reauthorization Act of 2013 (VAWA 2013): Overview of Applicability to HUD Programs. This notice provides an overview of the applicability to HUD programs of the recently enacted Violence Against Women Reauthorization Act of 2013. The 2013 law expands the number of HUD programs subject to the statute s protections beyond HUD s public housing and Section 8 programs. The notice highlights key changes made by the statute, lists the HUD programs now covered by the statute, provides an overview of key provisions applicable to HUD programs, and outlines HUD plans to issue rules or guidance on the new law. The notice is not program guidance for any individual HUD program covered by the new law. HUD will issue guidance and/or rules, as may be applicable, for covered programs at a later date. The purpose of the notice is to provide an overview of the VAWA 2013, and update HUD s program participants to the provisions applicable to HUD programs. HUD is seeking comments on the Notice, and comments must be submitted to HUD no later than October 7, 2013. Comments may be submitted by regular mail or email through the federal eRulemaking Portal at www.regulations.gov.   Introduction   On March 7, 2013, President Obama signed into law the Violence Against Women Reauthorization Act of 2013, which reauthorizes and amends the Violence Against Women Act of 1994. VAWA 2013 enhances judicial and law enforcement tools to combat domestic violence, improves services for victims, enhances services, protection, and justice for young victims of violence, strengthens the health care systems response to domestic violence, and expands protections for Native American women and immigrants. The provisions of the law applicable to HUD programs are found in Title VI of VAWA 2013.   While the provisions of Section 601 were effective on March 7, 2013, they are not "self-executing." This means that while the law is in effect, additional guidance and rulemaking will be required to enable and facilitate compliance with the VAWA 2013 provisions.   In addition to HUD s public housing and Section 8 programs, VAWA 2013 made the following HUD programs subject to the VAWA protections: Section 202 Supportive Housing for the Elderly This does not include Section 202 Direct Loan Projects that are without Project-Based Section 8 assistance. It also does not apply to Section 202 projects that are coupled with Section 162 Assistance (Project Assistance Contracts or "PAC") or to the new Senior Preservation Rental Assistance Contracts; Section 811 Supportive Housing for Persons with Disabilities; Housing Opportunities for Persons with Aids (HOPWA) Program; HOME Investment Partnerships (HOME) program; Homeless programs under Title IV of the McKinney-Vento Homeless Assistance Act; FHA Mortgage Insurance for multifamily rental housing under 221(d)(3) of the National Housing Act with a below market interest rate; Section 236 Housing; and HUD programs assisted under the United States Housing Act of 1937 (Public Housing under 6 and Section 8 projects). These HUD programs, together with rural housing assistance under certain sections of the Housing Act of 1949 and the Low-Income Housing Tax Credit Program, are the covered housing programs under VAWA 2013. This Notice compares the requirements of the pre-2013 VAWA requirements to those implemented by the new law. One of the most important elements of the Notice is confirmation that HUD public housing and Section 8 programs should continue to follow the regulations that were in place based on the pre-2013 law, and that HUD will issue new guidance on implementation of the new law. It is also important to note that while VAWA 2013 now applies to Low-Income Housing Tax Credit and Rural Development Service properties, such properties cannot implement the law until guidance is received from the Rural Development Service and IRS. HUD provided no indication of when guidance will be issued, but gave a deadline of October 7, 2013 for comments to be submitted to HUD on the Notice. This would indicate that there will probably be no formal guidance published by HUD until 2014.  

HUD Notice H2013-21, Implementation and Approval of Owner Adopted Admissions Preferences for Individuals or Families Experiencing Homelessness

This Notice provides guidance on the circumstances under which owners of HUD-assisted properties may adopt admissions preferences for the homeless. Prior to this Notice, HUD had strictly interpreted 24 CFR 5.655(c)(1) - (c)(5) to mean that project owners were limited in the preferences that they could implement to those preferences specifically referenced in the Regulation. Since homeless families were not mentioned in the Regulation, they could not be given a preference. HUD has determined that failure to mention a specific preference in the Regulation does not preclude owners from establishing such a preference. This Notice applies to all HUD Multifamily Rental Assistance programs.   Definition of Homeless   The Homeless Emergency Assistance & Rapid Transition to Housing Act of 2009 (HEARTH Act) provides the HUD definition of homeless. Owners may use the HUD definition of homeless or establish an alternative definition, based on local needs. The definition may be more narrow or broader than the HUD definition, but owners must obtain approval from the HUD Field Office for any definition other than the HUD definition.   Implementing a Homeless Preference   Eligibility & Requirements: Preferences affect only the order in which applicants are selected from the waiting list. Applicants must still be eligible and owners may enforce their own reasonable screening criteria. Owners must inform all applicants of the preferences and provide information on how to demonstrate eligibility for the preference; such information must also be provided to persons currently on the waiting list.         Tenant Selection Plan & AFHMP   All preferences must be identified in the Tenant Selection Plan (TSP), and, if required, in the Affirmative Fair Housing Marketing Plan (AFHMP). Any preference not cited in 24 CFR 5.655(c) must be approved by the local HUD office, including a homeless preference. Note that HUD does not have to approve termination of a preference, but the TSP must be amended when a preference is removed.   Using a Homeless Definition   While an owner may adopt a definition other than the HUD definition of homeless, the definition may not exclude any protected class, such as families with children. For example, a preference could not be given to homeless single males or females.   Limiting Preferences to People Referred by a Partnering Organization   Preference may be given to households referred by one organization or a consortium of organizations. Preference may be given for an entire property or a percentage of units. Units may not be set-aside or held off-line for the homeless, but vacancies may be filled by alternating selections from the regular waiting list and the homeless waiting list. HUD will not prescribe the ratio of admissions (e.g., 1:2, 1:4, etc.). Preference applicants must be screened in the same manner as applicants from the regular waiting list.   Use of Alternating Selection   Applicants must be selected by alternating waiting lists and the specific method must be identified in the TSP.       Identifying Preference-Qualified Applicants on the Current Project Waiting List   Applicants on the current project waiting list must be given an opportunity to show that they qualify for the additional preference. They must be given notice of the opening of a new waiting list and information on how to establish eligibility for the new waiting list, including a list of partnering agencies.   Verifying Preference Eligibility   Owners may require proof of eligibility for a homeless preference or rely on a verification from a partnering organization.   Property Designations If an owner has a property designation of elderly or disabled on all or some of the HUD assisted units, the designation is not superseded by the new preference. E.g., 100% elderly property, all units would have to be occupied by elderly. For a homeless person to occupy such a unit, they would also have to be elderly.   Ensuring Fair Housing Compliance   The owner should examine demographic data from the waiting list population and of the community population and compare this to the demographic characteristics of those who would qualify for the preference to ensure that the preference does not create a disparate impact on a particular protected class from accessing the program.   Submission & Approval of Preference Requests   Owners must receive HUD approval in order to adopt an admissions preference not specified in 24 CFR 5.655(c). A written request must be submitted to the local HUD Field Office specifying the preference with a full description of the preference and how it will be implemented. HUD will approve an owner-adopted preference if it does not result in discrimination, violate civil rights or equal opportunity requirements, or conflict with statutory, regulatory or program requirements. Admissions Policies Regarding Criminal Activity and Substance Use/Abuse   Owners must establish standards that prohibit admission of: Any household containing a member(s) who was evicted in the prior three years from federally assisted housing for drug-related criminal activity. The owner may, but is not required to, consider two exceptions to this provision: The evicted household member has successfully completed an approved, supervised drug rehabilitation program; or The circumstances leading to the eviction no longer exist (e.g., the household member no longer resides with the applicant household). A household in which any member is currently engaged in illegal use of drugs or for which the owner has reasonable cause to believe that a member s illegal use or pattern of illegal use of a drug may interfere with the health, safety, and right to peaceful enjoyment of the property by other residents; Any household member who is subject to a state sex offender lifetime registration requirement; and Any household member if there is reasonable cause to believe that member s behavior from abuse or pattern of abuse of alcohol may interfere with the health, safety, and right to peaceful enjoyment of the property by other residents. The screening standards must be based on behavior, not the condition of alcoholism or alcohol abuse. Owners may also establish additional screening criteria, as outlined in HUD Handbook 4350.3. An owner wishing to serve more people experiencing homelessness should consider reviewing his/her discretionary admission policies to determine if any changes can be made to remove barriers. Examples include easing of criminal screening procedures or prior landlord references.   Owners wishing to implement a preference for the homeless should review the entire Notice 2013-21. Also, feel free to contact me with any questions.  

HUD Final Rule on HOME Program

On July 24, 2013, HUD published a final rule on the HOME program. Most provisions of the rule are effective for properties that receive HOME funds on or after August 23, 2013. Properties already operating under the HOME program, or that receive HOME funds prior to August 23, 2013 will continue to operate under the prior HOME rules.   The final regulation has four primary goals: Accelerate the timely production and occupancy of assisted housing; Strengthen the performance of PJs and their partners in producing and preserving affordable housing units; Provide PJs with greater flexibility in the design and implementation of their programs; and Increase administrative transparency and accountability.   Timely Production & Occupancy of Assisted Housing   A rental project is considered complete when construction is complete and units are ready for occupancy. HOME projects must be completed within four units of funding commitment. v If not, the PJ will have to repay the HOME funds that have been drawn.   HOME-assisted rental units must be occupied within 18 months of project completion. If they are not, the PJ will have to repay the HOME funds for the non-occupied units. v If units are vacant six months following completion, the PJ will have to report to HUD on the marketing efforts being undertaken and may be required to develop an enhanced marketing plan.   A homebuyer unit must have a ratified sales contract within nine months of construction completion. If it does not, it must either be converted to a rental unit or the funds paid back.   Funds set-aside for Community Housing Development Organizations (CHDOs) must be committed to specific projects within 24 months of the PJ receiving its HOME allocation. (Note: this becomes effective October 22, 2013 and will be implemented by HUD for deadlines after January 1, 2015.) v PJs can no longer "reserve" CHDO funds for projects to be identified at a later date. v CHDO set-aside funds must be fully expended within five years of when the PJ receives its HOME allocation.   Strengthen Performance in Producing and Preserving Affordable Housing   Main issues in this area relate to underwriting, property standards, construction oversight, CHDO qualifications and capacity, and long-term project viability.   Underwriting and Program Design PJs must underwrite all HOME projects to ensure financial feasibility over the affordability period, and must review Cost; Market demand; Developer capacity; and Other funding sources Effective January 24, 2014, PJs must adopt program policies for homebuyer programs: Determine necessary assistance; Assess the ability of the buyer for long-term success; and Have anti-predatory lending and subordination policies. Homebuyers must receive housing counseling before receiving HOME assistance.   Property Standards & Construction Oversight (this section is effective for projects funded on or after January 24, 2015)   Property standards must use current national codes Standards are organized by project type: New Construction; Rehab; Acquisition without rehab; and Manufactured Housing PJs must identify a plan for major system repairs Rental rehab of 26 or more units must have a capital needs assessment. PJs must develop ongoing inspection policies and procedures, effective July 24, 2014. Must use state or local codes, or, in the absence of such codes, UPCS (replaces HQS). - HUD will issue additional guidance on this issue.   CHDO Qualification & Capacity Requirements   To qualify as a CHDO, a non-profit must have paid staff with the necessary experience to undertake CHDO set-aside activities. This requirement may not be met by a consultant.   Each time the PJ commits HOME funds to a CHDO, it must recertify the qualifications of the non-profit.   Long-Term Viability or Rental Projects   During the affordability period, PJs must examine the financial condition of projects with ten or more HOME units at least annually (this provision is effective July 24, 2014).   Provide Flexibility in Program Design and Administration   PJs may utilize a risk-based monitoring system and adjust the schedule of ongoing rental unit inspections. Inspections must occur no less than every three years. The first inspection must be within 12-months of project completion.   PJs may charge fees for their services: Reasonable application fees; Homebuyer counseling fees; and Ongoing rental monitoring fees   Increase Administrative Transparency and Accountability   PJs must develop risk-based monitoring systems for all HOME-funded activities.   Other Elements of Importance to Multifamily Developers & Managers   Housing: The definition of housing has been specifically changed to exclude halfway housing, dormitories (including farmworker dormitories), and all types of student housing (note that the eligible student definition has been changed to match the Section 8 definition of an eligible student). HOME housing must be permanent or transitional. Income Determinations: Source Documentation - must have a minimum of at least two months of source documentation (e.g., wage statements, interest statements, etc.) when determining income for HOME beneficiaries. Census Long Form may no longer be used as a definition of annual income. May use Section 8 definition or IRS income, but a single definition must be used for each project. This section of the rule clarifies that income of all household members counts - whether or not they are related. Manager Unit: Projects with 100% HOME units may convert one HOME-assisted unit to a manager unit. Costs Incurred before the Commitment of HOME funds HOME funds may be used to pay professional service fees that were incurred prior to the commitment of HOME funds. They must have been incurred no more than 24-months prior to fund commitment. Troubled HOME-assisted rental projects that are at-risk of foreclosure may be given additional HOME funds with HUD approval. The number of HOME-assisted units may also be reduced with HUD approval, but not below the minimum number of required HOME units. Fees Charged by Project Owners Project owners may not charge fees to tenants that are not reasonable or customary. Reasonable application fees, parking fees (when customary in the neighborhood), and the cost of non-mandatory services are allowable. (Note: when HOME funds are combined with LIHTC, rules of the tax credit program relative to permitted fees must also be followed). Qualification as Affordable Housing - Rental Housing; A number of new requirements as been added in this area: Initial Occupancy of Vacant Units: Within six months after project completion, the PJ must provide information to HUD on the marketing efforts of any units that have not yet been rented, and if necessary, must submit an enhanced marketing plan; If the unit still has not been rented 18 months after completion, HUD funds invested in the unit must be repaid by the PJ to HUD. Utility Allowances: PJ is required to develop a utility allowance and update it annually. Significant Change: a separate allowance must be developed for each HOME project. They may use the HUD Model Allowance or specific project utilities. The PJ may no longer rely on the PHA allowance for the Voucher program. Rent Review & Approval: The former rule required that the PJ approve initial rents, and then provide maximum rents on an annual basis; New Rule: PJ must examine and approve rents each year to ensure compliance with maximum HOME rents and that there is not an undue increase from a prior year. Tenant Protections & Selection: Leases are required - all HOME units must have a lease, which must be at least one year (unless a shorter period is agreed to by both the tenant and landlord). A lease may not require a tenant to accept supportive services (except for residents of transitional housing). Leases may only be non-renewed or terminated for good cause. Repeated lease violations; Violations of federal, state, or local law; or Completion of tenancy for transitional housing. If a tenant fails to participate in required supportive services for transitional housing, the lease may be terminated. An increase in a tenant s income does not constitute good cause for termination or non-renewal. Renting to special needs populations: Owners may limit eligibility of HOME-assisted housing or give preference to a particular group only if the PJ permits it in the written agreement. This does not apply if the project also receives assistance from a federal program that limits eligibility to a particular population segment, such as HOPWA, HUD s homeless programs, Section 202 program, and Section 811 Program. Other Tenant Selection Requirements: Owners must comply with HUDs Affirmative Fair Housing Marketing Plan requirements and adopt and follow tenant selection policies and criteria; Tenant selection criteria must limit occupancy in HOME-assisted rental housing to income eligible families; and Tenant selection criteria must be related to an applicant s ability to pay rent, maintain the unit in reasonable condition, and not interfere with the rights of other tenants. Affirmative Marketing: Minority Outreach Program   Affirmative marketing procedures now apply to all HOME-funded programs. Previously, the AFHMP requirements applied only to projects with five or more HOME units.   When a project has tenant preferences, the PJ must have affirmative marketing procedures that apply to the universe of the preference. For example, a project with a homeless preference could not rely solely on referrals from a specific homeless provider if there are other homeless providers with potential applicants in the market area.   This synopsis has outlined requirements that are of greatest concern to private developers. The final rule has many other components and requirements relating to CHDOs, Homebuyer Assistance Programs, Faith Based Organizations, Environmental reviews, and other requirements of the Participating Jurisdiction. It is strongly recommended that anyone with a comprehensive interest in the HOME program review the entire rule for applicability with his or her situation.        

HOME Program Rent Decreases

As you probably know by now if you are operating properties that utilize HOME funds, HUD has released the 2013 HOME rent limits. You may also be aware that due to calculation errors by HUD in earlier years, dating back as far as 2009, HUD now has to decrease the HOME rents in many areas. In order to offset the pain of these decreases, HUD is "phasing" in the reductions so that all required rent reductions will be in place by 2015.   Background   The maximum HOME rent limits are established in the National Affordable Housing Act of 1990 (NAHA), as amended. HUD s Economic and Market Analysis Division calculates the HOME rents each year using Fair Market Rents and Section 8 Income Limits.   In 2009, due to HERA, HUD had to eliminate its policy of holding Section 8 income limits harmless from reduction. This is because HERA provided for a separate determination of tax credit and tax exempt bond income limits, so there was no longer any reason for HUD to hold the Section 8 income limits harmless. However, HUD made the decision at that time to hold the income limits harmless in the calculation of annual HOME rent limits to avoid a negative affect on the operations of HOME properties. In short, HUD had no authority to do this since the method for establishing the HOME rent is Statutory - and not subject to HUD discretion. As a result, there have been no reductions in HOME rents since 2009. This error does not affect areas where rent limits have increased.   Effect on Properties   In order to minimize the impact in 2013, HUD is limiting the decrease in 2013 rents from the published 2012 rent limits to 33 percent of the total difference between the two rents. If 33 percent of the difference is $10 or less, HUD will permit the 2013 HOME rent limit to decrease by the entire amount. This process will continue in 2014 and 2015 so that all HOME rents will comply with the requirements of the law by 2015. Certain areas will be significantly impacted by these reductions, but it is important that all owners subject to HOME rent limits understand that HOME rents are not held-harmless from reduction, unlike rents for the Low-Income Housing Tax Credit Program.   If you have questions on how this procedure may affect your property, you should contact the Agency that oversees the HOME funds for your property. You should also feel free to contact me with any questions.

HUD Final Smoke Detector Rule for Section 202 and 811 Projects

HUD has issued a final rule, effective July 22, 2013, requiring that smoke detectors be installed in all subsidized housing for the elderly and disabled. The final rule, published in the July 20, 2013 Federal Register, requires that smoke detectors be placed in every bedroom and primary sleeping area. The final rule itself is fairly extensive, and applies only to Section 202 and Section 811 projects. In addition to the rule regarding installation of smoke detectors, the rule removes restrictions on the portions of developments not funded through capital advances, lifts barriers on participation in the development of the projects, and eliminates burdensome funding requirements. The rule regarding smoke detector installation should not affect most owners, since it is already a requirement of most local codes and insurance policies. Also, the rule does not dictate a specific technology or product. Owners currently involved with Section 202 or 811 projects (or those anticipating such involvement) should obtain and review the entire final rule.

Senate Bill Amending the Fair Housing Act Introduced

S. 1242, A Bill to Amend the Fair Housing Act, and for Other Purposes, was introduced in the Senate on June 27, 2013, and was referred to the Senate Judiciary Committee. The short title of the bill is "Housing Opportunities Made Equal Act of 2013," or the "HOME Act of 2013." The bill, if passed into law, will amend the fair housing act as follows: It will expand the protections for discrimination based on race or color to include both "perceived" and "actual" discrimination. It will create four new protected classes: Gender Identity, defined as gender-related identity, appearance, or mannerisms or other gender-related characteristics of an individual, with or without regard to the individual s designated sex at birth; Marital Status: The provision of housing or related services may not be based on whether someone is married, single, divorced, separated, or a widow(er). Different terms or conditions may not be placed on someone due to marital status (e.g., refusal to consider a wife's income relative to rent paying ability because she could decide to have children and no longer work); Sexual Orientation: homosexuality, heterosexuality, or bisexuality; and Source of Income: This would include receipt of Federal, State or local public assistance including medical assistance, or the receipt of Federal, State, or local housing subsidies, including rental assistance under Section 8 of the Housing Act of 1937 or other rental assistance or rental supplements. Section 3 of the bill extends the definition of a discriminatory housing practice to an act that is unlawful under the law whether pre-or post-acquisition of a property and also would make failure of a recipient of federal housing funds to affirmatively further fair housing a discriminatory act. Section 4 of the bill expands the definition of familial status to anyone standing in loco parentis (in place of a parent) of an individual or individuals under the age of 18. Section 5 of the bill would amend both the Fair Housing Act and the Equal Credit Opportunity Act to provide the Department of Justice (DOJ) with pre-litigation subpoena power. In this case, if the DOJ has reason to believe that any person may be in possession, custody, or control of any documentary material or information relevant to any investigation under the Fair Housing Act, the DOJ may, before commencing a civil action, issue a civil investigative demand (i.e., subpoena). Section 7 of the bill would amend the Fair Housing Act to include the following language: "Discrimination against a person because of handicap includes the failure, in connection with a real estate-related transaction, to make reasonable accommodations for such person." This is very similar to current requirements, but makes clear that reasonable accommodations may be required for any activity related to a real estate transaction. Section 8 of the bill would make a very significant clarification to existing law. It would codify that the failure to design and construct a dwelling as required by the Fair Housing Amendments Act of 1988 shall be deemed to continue until such time as the dwelling conforms to the requirements of the law. This is important because some courts (but not all) have ruled that the two-year statute of limitations for filing a fair housing complaint precludes a complaint regarding the design and construction of covered housing if the housing was completed more than two years prior to the complaint. This change to the law would make it clear that such a violation would be considered "continuous" noncompliance. (HUD and DOJ have recently published a joint statement detailing the design and construction requirements under the Act, with important clarifications. I will be sending a memo to clients on this joint statement shortly). Please note that this is a bill only, and there has been no change to the law. I will keep you informed on any changes, but please feel free to call me with any questions.    

Rural Area Definition - Legislative Update (June 28, 2013)

Approximately 900 communities across the United States that are currently considered "rural" for purposes of United Stated Department of Agriculture (USDA) programs are in danger of losing their rural designation. The communities will no longer be considered rural based on data from the 2010 census unless legislation is passed to "grandfather" those localities, allowing them to retain their rural designation.   Generally, communities with populations less than 20,000 are designated as "rural" if they meet other requirements. In 1983, Congress amended the Housing Act of 1949 to protect communities where the population had grown since the prior census; this protection is known as "grandfathering."   The most recent grandfathering methodology allows communities with populations up to 25,000 to retain eligibility if they were previously eligible under either the 1990 or 2000 census. The most recent grandfather clause expired on September 30, 2012, and with the release of the 2010 census, any area that cannot meet the rural definition based on 2010 data will no longer be eligible for rural funding.   For existing properties to avoid losing their rural designation, Congress must pass a bill to extend the safe harbor for formerly rural communities with populations now in excess of the USDA limit. Congress would also have to pass a bill updating a 1974 definition of "rural" that excludes communities located in a metropolitan statistical area (MSA) for those communities to retain their rural designation.   A lose of rural designation could have substantial impact on certain LIHTC sites. Section 3004 of the Housing and Economic Recovery Act (HERA) allows developers of LIHTC properties without tax-exempt bond financing in rural areas to use the higher of the National Nonmetropolitan Income limits or the Multifamily Tax Subsidy Project (MTSP) income limits to determine income and rent. This benefit will be lost on a number of tax credit properties if Congress does not act to extend the rural designation.   Current Legislative Actions   On June 10, the Senate passed the Agriculture Reform, Food and Jobs Act of 2013 (S.954), also known as the Farm Bill, by a vote of 66 to 27. This bill includes language that rural communities eligible for USDA housing programs will retain their eligibility through 2020. The bill also raises the definition of "rural" from 25,000 to 35,000 in population.   The House version of the Farm Bill contains an amendment called the Rural Housing Preservation Act of 2013 (H.R. 858), which would allow any area currently considered rural to continue to be considered rural until 2020. On June 13, 2013, the House Appropriations Committee approved the fiscal year 2014 Agriculture Appropriations Bill, which also includes an amendment to extend the current definition of rural to 2020.   Unfortunately, on June 20, the House rejected its own version of the Farm Bill by a 234 to 195 vote. Even though the House bill called for more significant cuts to the food stamp program than the Senate bill, it still did not cut the program deeply enough to get majority support. Following the defeat of the Farm Bill, the Agriculture Spending Bill was pulled from the House calendar (no use appropriating money for a program that does not exist).   As for the future of the Farm Bill, it may be reconsidered by the House after the July 4 break. I would recommend that anyone with an interest in rural housing, including LIHTC owners with properties in rural areas, contact their House members and urge passage of the Farm Bill.

Effect of Supreme Court Ruling on DOMA on LIHTC Student Rule

As you probably know by now, on June 26, 2013 the Supreme Court declared that Section Three of The Defense of Marriage Act (DOMA) is unconstitutional. This decision basically holds that persons of the same sex who are legally married under State law may not be deprived of the federal benefits that are provided to married couples of the opposite sex.   This decision will have far-reaching implications for same sex couples in the areas of bankruptcy, federal student aid, federal employee benefits, the Family Medical Leave Act, immigration, Medicaid, Medicare, military spousal benefits, private employment benefits, Social Security, SSI, taxes, Temporary Assistance for Needy Families (TANF) and veteran spousal benefits.   Since same-sex couples currently cannot marry in every state, there is uncertainty about the extent to which same-sex spouses will receive federal marital based protections nationwide. For federal programs that assess marital status based on the laws of a state that does not permit same-sex marriage (including the filing of joint federal tax returns), those state laws will likely pose obstacles for same-sex couples in accessing federal protections.   The Section 42 (Low-Income Housing Tax Credit Program) has five specific exceptions that allow for occupancy of a low-income unit by a household consisting entirely of full time students. One of the exceptions is when all the adults are married and eligible to file a joint federal tax return. DOMA barred married same-sex couples from filing as "married," whether jointly or separately. Now that DOMA has been ruled unconstitutional, it is possible that the IRS will instruct married same-sex couples to file their income tax returns as "married" - whether jointly or separately - rather than as an "individual" or "head of household," provided the IRS recognizes the marriage.   I would expect guidance from the IRS prior to the publication of instructions for the 2013 tax returns on this issue. Guidance is required, since under current IRS practice, a person can file his or her tax return as "married filing jointly" or "married filing separately" if the individual is considered married in his or her state of domicile (essentially, the permanent residence/primary home). This would seem to suggest that only people in states that license or recognize marriages of same-sex couples and in D.C. can expect to be treated as married by the IRS. However, there is no statute or regulation requiring this approach, and the IRS does not always follow this practice. For example, the IRS recognizes "common law" marriages for federal tax purposes no matter where a couple lives as long as their marriage was valid where entered.   If you operate a LIHTC property in one of the states that recognizes same sex marriage, households consisting entirely of full-time students, where all residents are eligible to file a joint tax return (including same-sex couples), will qualify for residency. These states are Massachusetts, Connecticut, Iowa, California, Vermont, New Hampshire, District of Columbia, New York, Rhode Island, Delaware, Minnesota, Maine, Maryland, and Washington. As to whether LIHTC properties in all other states will be able to consider same-sex couples as eligible to file a joint tax return, we do not know. Owners and managers should not approve such couples under this student exception until guidance is provided by the IRS.