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The U.S. Department of Housing and Urban Development (HUD) has issued updated guidance to Public Housing Agencies (PHAs) on compliance with the Housing Opportunity Through Modernization Act (HOTMA) Sections 102 and 104. HUD will enforce compliance with provisions that can be accurately implemented and reported in the Inventory Management System/Public and Indian Housing (IMS/PIC) Information Center.
Key Compliance Requirements by July 1, 2025:
- New Income Exclusions: PHAs must use the new income exclusions as specified in 24 CFR 5.609(b).
- Updated Definitions: PHAs must adopt select definitions from 24 CFR 5.100, 5.403, and 5.603.
- De Minimis Errors Policies: PHAs must implement policies related to de minimis errors.
Income Exclusions Table:
| Category | Exclusion | CFR | Description |
| Other | Federally Mandated Income Exclusions | 24 CFR 5.609(b)(22) | Amounts that must be excluded by federal statute. HUD will publish a Federal Register notice that includes the qualifying benefits. |
| Assets | Imputed Income from Assets | 24 CFR 5.609(b)(1) | Any imputed return on an asset when net family assets total $50,000 (adjusted annually) or less and no actual income from the net family assets can be determined. |
| Non-recurring income | Non-recurring income | 24 CFR 5.609(b)(24) | Income that will not be repeated in the coming year based on information provided by the family. |
| Self-employment | Gross Self-employment Income | 24 CFR 5.609(b)(28) | Gross income received through self-employment or operation of a business. |
| Dependents | Minors (children under the age of 18 years) | 24 CFR 5.609(b)(3) | All earned income of all children under the age of 18, including foster children. |
| Dependents | Adoption assistance payments | 24 CFR 5.609(b)(15) | Adoption assistance payments for a child in excess of the amount of the dependent deduction. |
| Students | Earned Income of Dependent Students | 24 CFR 5.609(b)(14) | Earned income of dependent full-time students in excess of the amount of the dependent deduction. |
| Students | Title IV HEA Assistance | 24 CFR 5.609(b)(9)(i) | Any assistance that Section 479B of the Higher Education Act (HEA) of 1965, as amended, requires to be excluded from a family’s income. |
| Students | Other Student Financial Assistance | 24 CFR 5.609(b)(9)(ii) | Student financial assistance, not excluded under the HEA, for actual covered costs of higher education. |
| Students | Educational Savings Account | 24 CFR 5.609(b)(10) | Income and distributions from any Coverdell educational savings account or any qualified tuition program under IRS section 530 or any qualified tuition program under section 529. |
| Baby bonds | Baby bonds | 24 CFR 5.609(b)(10) | Income earned by government contributions to, or distributions from, ‘baby bond’ accounts created, authorized, or funded by federal, state, or local government. |
| Foster children / adults | Payments for Foster Children / Adults | 24 CFR 5.609(b)(4) | Payments received for the care of foster children or adults, including State kinship, guardianship care payments, or tribal kinship payments. |
| Foster children / adults | Income of foster children / adults | 24 CFR 5.609(b)(8) | Income of a live-in aide, foster child, or foster adult as defined in 24 CFR 5.403 and 5.603. |
| Live-in Aide | Income of a Live-in Aide | 24 CFR 5.609(b)(8) | Income of a live-in aide, foster child, or foster adult. |
| People with Disabilities | ABLE accounts | 24 CFR 5.609(b)(22) | Will be included in federally mandated excluded amounts. Notice PIH 2019-09/H-2019-06 details when ABLE account income is excluded. |
| People with Disabilities | State Payments to Allow Individuals with Disabilities to Live at Home | 24 CFR 5.609(b)(19) | Payment made by an authorized state Medicaid managed care system or other state agency to a family to enable a family member to live in the family’s assisted unit. |
| People with Disabilities | Plan to Attain Self-Sufficiency (PASS) | 24 CFR 5.609(b)(12)(i) | Amounts set aside for use under a Plan to Attain Self-Sufficiency (PASS). |
| People with Disabilities | Reimbursements for Health and Medical Care Expenses | 24 CFR 5.609(b)(6) | Amounts for, or in reimbursement of, health and medical care expenses for any family member. |
For more detailed information, please refer to the full guidance document or call your assigned Occupancy caseworker.