Novogradac LIHTC Working Group Comments on Audit Technique Guide

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Letter Addresses Key Points of Interest to Low-Income Housing Tax Credit Community Regarding IRS Update of Guidance for Examiners

Members of the LIHTC Working Group on March 28, 2014 sent a letter to the Internal Revenue Service (IRS) providing comments on the draft audit technique guide (ATG) for the LIHTC program, which provides guidance for IRS examiners who audit taxpayers owning LIHTC properties. The ATG for the LIHTC program was last updated in 1999.

The guide is organized in the order an examiner might address issues during an audit, generally working from high-level issues to issues requiring more detailed analysis, and chronologically from the pre-contact analysis through report writing.

“The IRS’s audit technique guide is an important technical document for LIHTC professionals,” said Stacey Stewart, CPA, a partner in Novogradac & Company LLP’s Dover, Ohio office who leads the LIHTC Working Group’s efforts. “The collective knowledge and range of perspectives our members bring to the table allow the LIHTC Working Group to provide meaningful input to the IRS as it updates and revises this key piece of guidance.”

In its comment letter to the IRS, the Novogradac LIHTC Working Group notes concerns about, and suggests solutions for, a number of items in the draft guide including various LIHTC compliance issues; costs includable in eligible basis such as developer fees and bond issuance costs; claiming credits before the issuance of Forms 8609; buildings affected by casualty losses, and much more. Once comments have been received and reviewed by the IRS, it is anticipated that the guide will be finalized and made available on the IRS website,

“We value the opportunity to comment on a document as significant as the IRS’s audit technique guide, which will play a meaningful role in the creation and preservation of affordable housing using the LIHTC in the years to come,” said Michael J. Novogradac, CPA, managing partner in the firm’s San Francisco office and the LIHTC Working Group’s adviser on industry and governmental affairs. “Considering the ATG’s scope and weight, this was an opportunity to share the input of developers, investors, syndicators and other affordable rental professionals.”

For details and a copy of the letter, please go to The LIHTC Working Group was established by Novogradac & Company LLP in 2008 to provide a platform for LIHTC industry participants to work together to resolve technical and administrative LIHTC program issues. Members meet monthly via conference call to provide input regarding pending action items as agreed to by the members of the group. Comments and suggestions generated during the group discussions are agreed to and submitted in writing directly to Treasury, the Department of Housing and Urban Development and/or various state agencies. For more information, visit or email lwg(at)novoco(dot)com.

Novogradac & Company LLP was founded in 1989, and has since grown to more than 400 employees and partners in offices in San Francisco and Long Beach, Calif.; the Washington, D.C., Atlanta, Ga., Detroit, Mich., Kansas City, Mo. and Seattle, Wash. metro areas; St. Louis, Mo.; Boston, Mass.; Austin, Texas; Dover, Columbus and Cleveland, Ohio; New York, N.Y. and Portland, Ore. Specialty practice areas include tax, audit and consulting services for tax-credit-assisted multifamily and affordable housing, community revitalization and rehabilitation of historic properties. Other areas of expertise include military base redevelopment, preparation and analysis of market studies and appraisals of multifamily housing investments and renewable energy tax credits.

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Stacey Stewart
Novogradac & Company LLP
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