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TAX CREDIT SPECIALIST EXAM 2025/
ACTUAL QUESTIONS AND ANSWERS GRADED
A+ GUARANTEED PASS
When conducting physical inspections for LIHTC, most state agencies use:
HUD's Uniform Physical Condition Standards (UPCS)
The two most important line items for management purposes under Part II of IRS Form 8609 are:
8B and 10C
IRS Form 8823 is used to:
Report non-compliance to the IRS by the State Agency
A tax credit disallowance prevents credits from being claimed by the owner:
for the current year
LIHTC resyndication means that:
Owners receive a second allocation of tax credits for an existing LIHTC property
For LIHTC, an individual's income is determined in a manner consistent with:
Determination of income under section 8 of the US Housing Act of 1937
(IRS Notice 88-80, Course Manual pg. 447)
Income for Foster Children under the age of 18 is counted except for:
Employment Income
(Figure 5-2, Page 5-8, Course Manual pg. 86)
When section 8 assistance is provided for LIHTC tenant and they are receiving educational scholarships or grants, then:
All financial assistance in excess of tuition and mandatory fees is included in annual income, with two exceptions
(Paragraph 5-6E, page 5-11, Course Manual pg. 89)
Who is responsible for most of the regulatory administration of the Low-Income Housing Tax Credit Programs?
Internal Revenue Service (IRS)
The initial Compliance Period for LIHTC properties combined with the Extended Use Period must be for a minimum period of affordability at:
30 years
The LIHTC regulations required that HUD guidance for properly identifying and calculating income and assets be followed according to:
HUD Handbook 4350.3 REV-
120 days before acquisition to qualify existing tenants and claim credits from acquisition.
-120 days after acquisition to qualify existing tenants and claim credits from acquisition.
-240 days surrounding the acquisition date to qualify existing tenants and claim credits from acquisition.
In the project example from appendix C (course manual pg. 525), the equity from the credit sale means that:
The tax credit project's mortgage will be less than that of the conventional property, providing less debt and greater affordability.
Bi-Weekly wages should be converted to annual income by multiplying by:
26
(Paragraph 5-5B3, page 5-6, Course Manual pg. 84)
Income verification for LIHTC must be conducted according to:
A standard of sufficiency as determined by the State Housing Finance Agency
(LIHC Newsletter #54, Course Manual pg. 473)
According to HUD, assets and asset income should be counted for all of the following except:
Live-in aides
(Figure 5-2, page 5-8, Course Manual pg. 86)
The current HUD-approved Passbook Savings Rate for use when imputing income from assets is:
0.06%
(Notice H2016-01, Course Manual pg. 213)
If periodic payments are being received from retirement benefits, then:
They are counted as annual income and the remaining amounts are not counted as an asset
(Paragraph 5-7G4b & d, pages 5-36 to 5-37, Course Manual pg. 114 to 115)
Assets that are jointly held should be:
Prorated by the percentage of ownership
(Paragraph 5-7D1, page 5-25, Course Manual pg. 103)
Per section 42 regulations, verification of assets for LIHTC is not required when:
The combined net assets do not exceed $
(NCSHA Under $5,000 Asset Certification)
The Qualified Basis consists of:
The eligible Basis multiplied by the Applicable Fraction
(Pg. 315)
Rent limits for LIHTC represent Gross Rent consisting of:
Contract rent plus utility allowances plus non-optional fees
Citizenship as a tenant eligibility requirement for LIHTC:
At the Owner's discretion
Determining a building's applicable fraction consists of a comparison between its:
Unit percentage and square footage percentage
The section 42 regulations for LIHTC say that annual income recertification is not required for:
100% LIHTC sites
The Available Unit Rule applies when:
The tenant's income increases over 140% of the current income limit
When transferring between buildings at LIHTC sites, tenant income must be:
Below 140% of the current income limit
One of the two provisions included in the Vacant Unit Rule provides that:
Reasonable attempts to rent vacant LIHTC units should be made before renting vacant market units
Which of the following Fair Housing Laws do not Apply to LIHTC?
Section 504 of the Rehabilitation Act
Compliance reporting requirements for LIHTC is at the discretion of the State Housing Agency, but the following is not:
Owner's Certification of Continuing Program Compliance
One of the requirements for a unit to be considered qualified as low-income in order to generate tax credits is that its building be placed in service for at least:
30 days
The students status of tenant household members is:
Taken into consideration for eligibility at all times
It is suggested that many of the documents discussed in this class be contained:
In a project data file
If the average income target for a LIHTC project's minimum set-aside drops below 40% of the project's unit averaging at or below 60% AMI after the first year of the credit period, then:
No credits would be available to the owner during that taxable year
In determining a building's applicable fraction, its unit percentage and its square footage percentage:
Should be compared to see which is smaller
In order to determine 140% of the applicable income at recertification for LIHTC:
The current income limit is multiplied by 1.
The General Public Use requirement for LIHTC means that:
Rental units must be available for use by the general public
ANDRE A SINGLE TAXPAYER WHOSE AGI IS $270,000 MAY NOT BE
ABLE TO CLAIM THE FULL BENEFITS OF SOME COMMON ITEMIZED
DEDUCTIONS
TRUE
SELF EMPLOYED MEDICAL INSURANCE PREMIUM IS CLAIMED ON
SCHEDULE 1
SELF EMPLOYED INCOME IS REPORTED ON SCHEDULE
C
STUDENT LOAN INTEREST IS REPORTED ON SCHEDULE 1
SELF EMPLOYED INCOME IS REPORTED ON SCHEDULE C AND
CARRIES TO
SCHEDULE 1
MILITARY RESERVE BUSINESS TRAVEL EXPENSES ARE RECORDED
ON SCHEDULE 1 LINE 24
YES
IN GENERAL LIFE INSURANCE PROCEEDS RECEIVED AFTER THE
DEATH OF A SPOUSE ARE NOT TAXABLE
TRUE
IN 2018 THE ADDITIONAL EXCISE TAX FOR NON-QUALIFIED
DISTRIBUTIONS FROM AN HSA IS --%
TRUE
INSURANCE PAYMENTS FOR A CASUALTY LOSS DO NO DECREASE
BASIS
TRUE
DEPRECIATION DECREASES BASIS
TRUE
MFJ CAPITAL GAINS EXCLUSION FROM THE SALE OF PERSONAL
RESIDENCE IS
$500K
THE NET INVESTMENT TAX IS COMPUTED ON THE LESSER OF THE
AMOUNT BY WHICH THE TAXPAYER'S MODIFIED ADJUSTED GROSS
INCOME EXCEEDS THE THRESHOLD OR THE TAXPAYER'S NET
INVESTMENT INCOME
TRUE
THE PORTION OF THE AOC THAT IS REFUNDABLE IS
40% OF EXPENSES UP TO $
THE AMOUNT OF THE AOC THAT CAN BE CLAIMED ON A TAX
RETURN IS $2500 PER ELIGIBLE STUDENT CLAIMED ON A THE
RETURN
TRUE
HOW MUCH OR THE AOC MAY BE REFUNDABLE
TAX LIABILITY AND MAGI THE PHASE OUT THRESHOLDS MAY LIMIT
THE THE MAXIMUM CHILD TAX CREDIT OF $2000 PER QUALIFYING
CHILD
TRUE
CALVIN PURCHASED A NEW OFFICE DESK ON 7/23/18 AT THE COST OF
$2373. HE DID NOT CLAIM THE BONUS DEPRECIATION DEDUCTIONS.
USING THE HALF-YEAR CONVENTION, CALVIN MAY CLAIM 2018
DEPRECIATION IN THE AMOUNT OF $
TRUE
POINTS FROM REFINANCE ARE DEDUCTED ON SCHEDULE A THE
YEAR THE LOAN IS PAID OFF
TRUE
THE PENALTY FOR NEGLIGENCE OR INTENTIONAL DISREGARD IS
TRIGGERED WHEN THE TAXPAYER FAILS TO FILE THE RETURN BY
THE DUE DATE, INCLUDING EXTENSIONS, AND THERE IS A BALANCE
DUE
TRUE
REINVESTED DIVIDENDS ARE TAXABLE ON THE CURRENT YEAR
RETURN AND THE BASISIS INCREASED
TRUE
INTEREST IN A TREASURY BILL IS REPORTED AS TAXABLE INTEREST
ON THE FEDERAL RETURN
TRUE
Legal fees related to creating a partnership or corporation are immediately deductible up to $5,000.
TRUE
READ THE EITD SCHEDULES
TRUE
THE MAX HSA CONTRIBUTION FOR TAXPAYER OVER 55 IS $
TRUE
