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On March 11, 2021, President Joe Biden signed the American Rescue Plan Act of 2021 into law. The $1.9 trillion COVID-19 relief bill, which passed in the U.S. Senate by a narrow 50-49 vote on March 6 and in the U.S. House of Representatives by a 220-211 vote on March 10, signifies the Biden administration's first legislative achievement with the Democratic majority in Congress to expand federal assistance to the American public.

To get an edge over your competition and reduce the hassles associated with collecting rent, you may be considering letting residents pay their rent by credit card. While accepting credit card rent payments is generally a reliable way to get paid, there are some precautions you should take before you do so to make sure you get all the rent that's due.

Q My company is about to manage a new tax credit site. We heard that tax credit managers can choose to base the rent for a low-income unit on either the size of the household that occupies the unit or the number of bedrooms in the unit. Is this true?

Suppose that, a few months after determining that a tax credit household is over-income, you've rented enough units to satisfy the next available unit (NAU) rule. If your lease doesn't give you the right to raise the over-income household's rent once you've complied with the NAU rule, you may not be able to maximize your site's earning potential. The unit no longer earns any tax credits, and it doesn't bring in market-rate rent either.

When one of your tax credit residents gets confined to a hospital or nursing home, you must decide whether the absence is temporary or permanent. This is due to the fact that a household member's temporary or permanent absence will determine whether you must count her income when you recertify the household. If you calculate household income incorrectly, the IRS may cite you for noncompliance, and you'll place the owner's tax credits in jeopardy.

It's easy to make a mistake when calculating the rent you charge low-income households at your tax credit site. For instance, a staff member might have made an error in arithmetic when adding a household's utility allowance, or staff may have used the income limits for the wrong geographic area or family size to calculate a resident's rent.

Q How can a low-income housing tax credit (LIHTC) site owner collect rent that is above the area median income rent when the resident is receiving Section 8 in a tax credit unit?

A The tax credit program allows owners to charge more than the tax credit rent for residents receiving rental subsidies, says tax credit consultant Elizabeth Bramlet.

Every time a resident bounces a check, it drives up your site's costs. The penalty fees charged for depositing bad checks averaged $28.95 last year—an all-time high, according to a survey published by http://Bankrate.com. Add to that staff time spent on collection efforts, the disruption in cash flow, and interest payments, and you can easily see why it's important to ensure that you are reimbursed for insufficient funds fees.