Income Eligible Senior Apartments
Section 42 Tax Credit Program
The Section 42 LITHC Tax Credit Program is a program for those making moderate or lower incomes. Congress created the Program in 1986 as part of the Tax Reform Act, which is administered by the Internal Revenue Service.
This Program is not a subsidized housing program or Section 8. Each resident is responsible for the full amount of rent each month. The rent is NOT based on your individual household income but rather on the pre-set income limits in the area. Some apartments within a community may not be part of the program and the rents there may often be higher.
To become eligible, your total household income including income from your assets, must be less than or equal to the pre-set income for the area.
Click Here for the Income Calculation Worksheet
Income: All of your gross income is included (employment, Social Security including Medicare payment, pensions, annuities, etc.)
Assets: Interest earned on assets is considered income. EXAMPLE: You have a $5,000 Certificate of Deposit (CD). It earns $300 in interest per year. The $300 is counted as income, not the $5,000. Assets include checking and savings accounts, as well as potential income from IRA’s, 401K, Certificate of Deposits, Stocks, Bonds, Real Estate, Life Insurance Policies, and Annuities. Only .06% of the Fair Market Value of a home is counted as income. The Fair Market Value can be taken from a recent assessment or from the amount shown on your Property Tax Statement.
The majority of Clare Meadows apartments have a pre-set income of under $42,300 per year for a 1 person household, or under $48,300 per year for a 2 person household.