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federalUnited StatesLow-Income Housing Tax Creditutility_allowance
The utility allowance must use a permitted method and be reviewed at least annually
lihtc.ua.method_and_review · v1.0.0
The owner must determine the utility allowance for each unit using a method permitted by the regulation, review the allowance at least once during each calendar year, and apply any change to rents no later than 90 days after making the new allowance available to affected tenants.
A utility allowance error is a rent error with a delay: it silently pushes gross rent above the limit for every affected unit and month. CORRECTED 2026-08-31: this record stated a twelve-month review interval and tested one. The regulation says 'at least once during each calendar year', which is not the same requirement -- and the corpus was the stricter of the two, so it reported compliant owners in breach. Verified against 26 CFR 1.42-10(c)(2) fetched from eCFR this session, and corroborated by IRS Pub. 5913 C(4).
- Confidence
- high
- Effective from
- 2008-07-29
- Last reviewed
- 2026-08-31
Evidence required
- Utility allowance documentation(one_per_year)
Citations
All sources verified within 1 day- Utility allowances26 CFR 1.42-10(a), Inclusion of utility allowances in gross rent