In Practice
The compliance period is the stretch of time when an affordable property must follow its program's rules, or risk losing benefits. In the Low-Income Housing Tax Credit program, the initial compliance period is 15 years, starting when the credits are first claimed. Most properties also sign an extended use agreement that keeps the affordability rules in place for at least another 15 years, so many run 30 years or more.
For site teams, this matters because the rules do not go away when you hit year 15. Every move-in, income certification, rent calculation and inspection is part of the record that the state housing agency and the owner's investors review. The owner, lender and agency often track the dates, but on-site staff keep the files that prove compliance throughout.
Example: a property placed in service years ago is in its compliance period. A new household moves in. The team verifies income, completes the certification, sets the rent below the maximum, and files everything. If the file is missing or the rent is too high, it can be reported as noncompliance to the agency.
The common mistake is relaxing after the first 15 years. Many properties are still bound by extended use agreements, state agency rules or other financing. Ask your regional manager or compliance contact which dates and agreements apply, and check the program's rules and counsel for questions on what happens at the end.
Compliance Period: Common Questions
How long is the LIHTC compliance period?
The initial compliance period is 15 years. Most properties also have an extended use period of at least 15 more, for a total of 30 or more.
What happens if a property falls out of compliance?
The agency can report it to the IRS, and the owner can lose or have to repay some tax credits. Fixing issues quickly and keeping clean files matters.
Does the compliance period end when the 15 years are over?
Not always. Extended use agreements and other financing often continue the affordability rules.
