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Public housing agencies now have a firm federal date for full HOTMA compliance. Notice PIH 2026-15 sets January 1, 2027 as the day HUD begins enforcing sections 102 and 104 of the Housing Opportunity Through Modernization Act for most PHAs, and a September 29 set of HUD answers to frequently asked questions clarifies exactly who is covered and how tricky cases should be handled. The changes behind the deadline are not new law. The HOTMA final rule implementing sections 102 and 104 took effect January 1, 2024, and agencies have been phasing toward compliance while HUD's systems caught up. What changes on January 1 is enforcement: for covered PHAs, every Form HUD-50058 transaction with an effective date of January 1, 2027 or later must reflect HOTMA requirements. For property managers and housing authority staff, the weeks ahead are a working window. This explainer walks through who the deadline covers, what sections 102 and 104 actually change in day-to-day recertification work, how HUD says to handle families reporting multiple income changes at once, and the hardship relief question the FAQs answer. It reflects HUD's published guidance as of October 2026 and is not a substitute for a PHA's own policies.
The enforcement date applies on a PHA-wide basis, not family by family. According to HUD's September 29 FAQ document, every PHA is subject to the January 1, 2027 compliance deadline except PHAs participating in the Moving to Work demonstration and PHAs that were exclusively using the HUD Family Reporting Software as of May 14, 2026. The MTW exception is broader than it may look. The FAQ states it applies to both initial MTW agencies and MTW Expansion agencies, and it covers the entire agency even where MTW flexibility applies to only one program. The reverse is also true: if an MTW agency administers programs for a non-MTW agency, that non-MTW agency remains subject to the deadline. For MTW agencies and FRS-only agencies, HUD will enforce sections 102 and 104 once it completes certain systems modifications. Notice PIH 2026-15 describes those modifications in its sections on MTW and FRS reporting. The FAQ also cautions that PIH 2026-15 does not set a HOTMA compliance deadline for Office of Multifamily Housing programs; multifamily owners should follow the separate Housing notices and the Multifamily HOTMA page for their timeline.
Section 102 of HOTMA rewrites how income and assets are reviewed for public housing and voucher programs. It replaces the old Earned Income Disregard, changes deductions, raises the threshold for counting health and medical care expenses, and limits how often certain reviews must occur. Section 104 sets maximum asset limits for assistance and requires self-certification of net assets below a set threshold. The final rule carrying these provisions, published at 88 FR 9600, has been effective since January 1, 2024. HUD initially allowed agencies to set their own compliance dates through January 1, 2025 under Notice PIH 2023-27, later extended through Notice PIH 2024-38 with a July 1, 2025 compliance deadline for identified provisions. Notice PIH 2026-15, issued May 14, 2026, leaves that earlier deadline untouched and adds the January 1, 2027 enforcement date for full compliance. That history matters for managers reading mixed guidance. Earlier extensions were about when agencies had to start applying HOTMA rules. January 1, 2027 is about when HUD will enforce that covered agencies' transactions are HOTMA-compliant, with the HUD-50058 effective date as the test.
The FAQ's second answer addresses a scenario every recertification team recognizes: a family reports several changes at the same time, such as losing unemployment benefits while starting a new job. Whether the PHA must run an interim reexamination depends first on its own written policy about increases in earned income after an interim reduction in the same reexamination cycle. If the PHA has no such policy, it must not consider the earned income increase at all when assessing the reported changes. The remaining changes are assessed on their own, and the increase is noted and picked up at the next regular reexamination. If the PHA does have the policy, the order of operations matters. Where the family has not yet received an interim reduction in the cycle, the PHA first examines all changes excluding the earned income increase. If those changes alone would trigger an interim reduction, and the reported increase in annual adjusted income is 10 percent or more, the PHA conducts an interim reexamination for the decrease followed by one for the increase. HUD also permits processing both simultaneously as a single reexamination reflecting the cumulative effect, but only when both the decrease and the increase are independently sufficient to trigger reexaminations. The FAQ includes a worked example with dates: a family with $10,000 in unemployment income reports on September 9, 2026 that the benefit has ended and a $20,000-a-year job has begun. Under each policy choice, the answer shows how the 10 percent threshold and the October 1 and November 1 effective dates interact. Managers should note the separate rule that a PHA with a policy of skipping increase reexaminations in the last three months of a certification period would not process the increase in that window.
The third FAQ addresses phased-in hardship relief tied to the higher threshold for deducting health and medical care expenses and reasonable attendant care and auxiliary apparatus expenses. HUD says it is finalizing a rule to update the eligibility date currently in 24 CFR 5.611(c)(1)(i). The practical point comes from the FAQ's plain-language reading: once the final rule is effective, every PHA subject to the January 1, 2027 deadline must provide phased-in hardship relief to families who, at their most recent income review before that date, received a deduction for those medical or disability-related expenses. That is a population agencies can identify now. Pulling a list of households currently receiving the affected deductions before January 1 gives staff a head start on the relief determinations the new framework will require, and on the family communications that should accompany them.
Section 104's asset restriction lives at 24 CFR 5.618. Under it, a public housing unit may not be rented, and Section 8 tenant-based or project-based assistance may not be provided, either initially or at reexamination, to a family whose net assets exceed $100,000, adjusted annually by HUD using the Consumer Price Index for Urban Wage Earners and Clerical Workers. Net assets carry the definition in 24 CFR 5.603.
The same section restricts assistance for a family with a present ownership interest in, legal right to reside in, and effective legal authority to sell real property suitable for occupancy as a residence. The regulation lists exceptions: property receiving assistance under the homeownership option provisions, jointly owned property where a non-household co-owner lives at the property, situations involving victims of domestic violence, dating violence, sexual assault or stalking, and property the family is offering for sale.
Suitability is defined by what the property is not. A property is not suitable if the family demonstrates it does not meet disability-related needs, is too small, is located so as to be a hardship relative to work or school, is unsafe and cannot easily be remedied, or cannot lawfully be occupied under state or local law. Those determinations sit with the PHA or owner, which makes consistent written standards important.
The regulation gives agencies a documentation tool that recertification teams should understand before January 1. A PHA or owner may determine a family's net assets based on the family's certification that net family assets do not exceed $50,000, an amount also adjusted annually, without taking additional verification steps. The certification must state the income the family expects from those assets, and that expected income counts in the family's income calculation.
A parallel certification is available for the real property restriction: the agency may rely on a family's certification that it holds no present ownership interest in real property at the time of the income determination or review.
Two cautions follow. First, these certifications are options the agency may use, not exemptions from the underlying limits. Second, when a domestic violence exception is raised, the regulation requires compliance with the confidentiality rules at 24 CFR 5.2007, acceptance of self-certification, and adherence to the restrictions on requesting documentation. Staff handling those conversations need to know those rules before they arise.
Section 5.618(c) adds a policy choice that belongs in every agency's written procedures. When recertifying a family subject to the asset restrictions, a PHA or owner may choose not to enforce them, or may establish exceptions based on eligibility criteria. That discretion makes the agency's own policy document the operative answer in many cases, the same pattern the FAQ shows for interim reexaminations.
For managers, the message across all of section 104 is consistent with the broader HOTMA transition: the federal framework sets the limits and the documentation options, but the agency's written policies determine how daily work flows. January 1, 2027 is the date transactions must reflect that framework. Policies written and trained before then are what make that compliance real rather than nominal.
Covered PHAs should treat the remaining weeks of 2026 as a checklist period. First, confirm whether the agency is actually subject to the deadline, because the MTW and FRS exceptions turn on agency status as of May 14, 2026 and apply agency-wide.
Second, align written policies with the FAQ positions, especially the election on earned income increases after an interim reduction and the last-three-months policy. The FAQ repeatedly ties the correct processing answer to what the agency's own written procedures say, so undocumented policy choices are a compliance risk by themselves.
Third, test the transaction pipeline. Because the test is the effective date on Form HUD-50058, transactions with effective dates on or after January 1, 2027 must be HOTMA-compliant, and software configuration should be verified against that cutover rather than assumed.
Fourth, prepare the hardship relief population. Identifying families who received the affected deductions at their most recent review before January 1 positions the agency to deliver phased-in relief promptly once HUD's final rule takes effect. Agencies should watch for that Federal Register final rule, since the FAQ describes it as forthcoming rather than final.
For private managers of multifamily properties, the same period is a reminder that the Office of Multifamily Housing runs on a separate HOTMA track. PIH notices do not govern that timeline, and owners should rely on the current Housing notices and HUD's Multifamily HOTMA resources instead.
HUD will enforce HOTMA sections 102 and 104 for most public housing agencies starting January 1, 2027, under Notice PIH 2026-15. Every HUD-50058 transaction with an effective date on or after that day must be HOTMA-compliant for covered agencies.
Moving to Work agencies and PHAs exclusively using HUD's Family Reporting Software as of May 14, 2026 are excepted until HUD completes systems changes; the exception applies agency-wide. Multifamily Housing programs follow a separate track.
HUD's September 29 FAQs explain how to handle families reporting multiple changes at once, with the answer turning on the agency's written policy about earned income increases after an interim reduction and the 10 percent threshold.
The FAQs also confirm that PHAs under the deadline must prepare phased-in hardship relief for families who received health, medical or disability-related expense deductions at their most recent review, once a forthcoming final rule takes effect.
Section 104's asset rules at 24 CFR 5.618 cap net family assets at $100,000 with a real property restriction, allow self-certification below $50,000, and give agencies enforcement discretion that belongs in written policy now.
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