Understanding Deductions, Allowances and Exemptions, Including HOTMA changes

Navigating medical expenses, allowances, and deductions in HUD-funded properties is one of the most detail-heavy compliance areas, and one of the easiest places for staff to make costly mistakes. This webinar delivers a step-by-step review of HUD requirements, clarifying the differences between allowances, deductions, and eligible medical expenses. With HOTMA-driven changes now in effect, property staff must adapt quickly to new verification, calculation, and documentation rules. This session provides practical tools, compliance strategies, and examples to help you process deductions correctly and avoid errors that trigger findings or tenant disputes.

From understanding what qualifies as an allowable medical expense to applying the right thresholds, participants will leave with a stronger grasp of HUD Handbook 4350.3 guidance, HOTMA updates, and best practices for tenant file compliance. Whether you’re calculating medical deductions, handling disability assistance expenses, or sorting through what’s eligible versus ineligible, this course equips you with the clarity needed to ensure accuracy, fairness, and compliance.

Webinar Objectives

• Misunderstanding the difference between allowances, deductions, and medical expenses
• Errors in determining eligible vs. ineligible medical expenses
• Failure to apply HOTMA’s new 3% → 10% threshold rules correctly
• Inconsistent or weak verification methods
• Double-counting one-time medical expenses across ARs/IRs
• Poor file documentation or lack of tracking systems

Webinar Agenda

• Audit Findings: Incorrect deductions leading to MOR or PBCA findings
• Tenant Complaints: Disputes when legitimate medical costs aren’t counted
• Calculation Confusion: Struggles with applying new HOTMA rules on thresholds and exemptions
• Verification Headaches: Difficulty collecting or assessing proper third-party verifications
• Operational Stress: Overlooking documentation retention and tracking requirements

Webinar Highlights

By the end of this session, participants will be able to:

• Define allowances, deductions, and medical expenses under HUD rules.
• Identify what medical expenses qualify as deductions (and which do not).
• Apply HOTMA’s phased-in threshold changes to medical and disability assistance deductions.
• Implement proper verification methods and avoid common calculation errors.
• Develop effective tracking and documentation practices to prevent duplication or missed deductions.
• Confidently calculate and document deductions to keep tenant files compliant and audit-ready.

Who Should Attend

• Compliance Directors and Managers
• Property Managers and Assistant Property Managers
• Occupancy Specialists
• Asset Managers (Owners, Agents, Management Agents)
• Regional Managers and Portfolio Directors
• Training and Policy Development Officers