HUD published the 2026 passbook savings rate that housing agencies must use when imputing asset income for assisted households. The rate is small, 0.40%, but it changes who owes imputed income, who’s eligible for assistance, and how owner/manager systems calculate tenant income. This guide lays out the numbers, the day-by-day steps to apply the rate, common pitfalls, and how regional housing agencies should adapt in 2026.

Quick-reference summary

Key HUD 2026 passbook rate facts at a glance:

  • HUD passbook savings rate (2026): 0.40% (effective Jan. 1, 2026).
  • Net family asset threshold for imputed income: $52,787 (effective Jan. 1, 2026).
  • Eligibility restriction threshold (no public housing or Section 8 if exceeded): $105,574.
  • HUD publishes annual values no later than Sept. 1 each year.
  • 2026 values were posted Aug. 5, 2025 and apply to MFH and PIH programs.
  • HOTMA (Housing Opportunity Through Modernization Act) governs the adjustment rules (enacted 2016).
  • Imputed asset income is calculated only when net assets exceed $52,787 and only on assets lacking a calculable return.
  • HUD annually updates eight inflation-adjusted items alongside the passbook rate.
  • PHAs/MFH owners must use the HUD rate for certifications effective Jan. 1, 2026, or later.
  • CHARTConnect and other software tools have specific fields (e.g., CHARTConnect guide page 38) where the effective date and rate must be entered.

Detailed breakdown: what the 0.40% rate covers

So what's the passbook rate? It’s the annual rate HUD publishes to impute income on certain household assets when those assets don’t produce a measurable income stream. For 2026 HUD set that rate at 0.40% and tied it to the HOTMA inflation-adjusted schedule effective Jan. 1, 2026.

Who must use it: Public Housing Authorities (PHAs), Multifamily Housing (MFH) owners, and their software vendors must use the HUD-published passbook rate when calculating imputed asset income for households whose net family assets exceed $52,787.

When to apply it: Tenant certifications, interim recertifications, and other income examinations with effective dates on or after Jan. 1, 2026, must reflect the 0.40% rate. HUD publishes the values annually no later than Sept. 1 so agencies have time to implement updates ahead of January.

Mastheads

Step-by-step: how to calculate imputed asset income using the 2026 rate

That said, follow these steps when a family’s net assets trigger an imputed income calculation.

  1. Identify all family assets, bank accounts, CDs, stocks, bonds, trust accounts, equity in real property, and other liquid or non-liquid assets.
  2. Calculate gross asset value and allowable deductions to arrive at net family assets. Confirm whether the household has a present ownership interest in real property that’s suitable for occupancy.
  3. Compare the total net family assets to the threshold: $52,787. If net assets don't exceed $52,787, don’t impute income under HOTMA rules.
  4. If net assets exceed $52,787, determine whether each asset produces an actual calculable income. For assets that do produce income, use the actual income figure.
  5. For assets that don’t produce income or where income can’t be calculated, impute income by multiplying the asset’s value by the HUD passbook rate of 0.40% (annual rate). Example: a $20,000 non-interest-bearing asset yields imputed income of $80 (20,000 x 0.004).
  6. Add up actual income and imputed income to get total asset-based income. Include this in household adjusted income calculations per HUD rules.
  7. Document calculations and retain source documents. If the household’s net assets exceed $105,574 or the household has a present ownership interest in suitable real property, verify whether the household becomes ineligible for public housing or Section 8 per the eligibility restriction.

Costs, fees, and eligibility criteria

There’s no fee to use the HUD rate. But applying the passbook rate affects household eligibility and subsidy levels.

  • Imputed income threshold: $52,787, no imputation below this level.
  • Eligibility cutoff: $105,574, households above this may be ineligible for public housing or tenant-based/project-based Section 8 (subject to program rules and exceptions).
  • PHAs and MFH owners must update policies and software to reflect the Jan. 1, 2026 effective date and 0.40% rate for certifications on or after that date.

Agencies trip up in predictable ways. Avoid these errors:

  • Not updating software: if the system still uses an old passbook rate, certifications will misstate income. Contact vendors and update CHARTConnect entries (see guide page 38).
  • Applying the rate to households below $52,787, the rule only kicks in above the threshold.
  • Imputing income on assets that already produce a calculable return, use actual income for those assets.
  • Using the HUD passbook rate for programs that aren’t subject to HOTMA rules (HOME, HTF, RD, LIHTC households may be excluded).
  • Failing to check the $105,574 ineligibility rule or to document present ownership interest in property correctly.

HUD sets the national passbook rate and thresholds, but PHAs and state agencies control local implementation and timing.

  • PHAs: Many will block-apply the HUD values for all certifications effective Jan. 1, 2026. But some agencies may run catch-up processes, retroactively correcting certifications processed early in January.
  • State housing authorities: Some states require MFH owners to adopt HUD published values immediately; others allow phased rollouts. Check local PIH notices.
  • Software vendors: Systems used by thousands of properties (conventional public housing, PBRA, tax-credit properties) typically publish a patch or patch notes. CHARTConnect users should enter the effective date and new passbook rate in the working workbook as directed.
  • Local outreach: PHAs often include the new thresholds ($52,787 and $105,574) in tenant notices and owner briefings to avoid disputes at recertification.

HUD’s passbook rate isn't a market rate. It’s a flat administrative rate used only for imputed income calculations. Comparisons that matter:

  • HUD passbook rate (2026): 0.40% (administrative).
  • Bank savings or money market rates: vary by institution; could be higher or lower than 0.40% depending on market conditions in 2026.
  • Actual asset return: use the true return when available, that’ll usually be more accurate than imputation and may raise or lower reported income vs. The HUD calculation.

HUD will publish a new passbook rate and inflation-adjusted items no later than Sept. 1, 2026, for values effective Jan. 1, 2027. Expect these dynamics:

  • If inflation and market interest rates rise, HUD’s published passbook rate will likely increase above 0.40% in 2027. A 0.25-1.00 percentage-point market shift could lift the HUD passbook rate by a similar margin, though HUD’s methodology ties to published indicators and administrative rules.
  • Thresholds (the $52,787 and $105,574 numbers) adjust with inflation. Historically HUD updates these annually; anticipate another increase for 2027.
  • PHAs and vendors should plan an annual update cadence: expect a HUD posting by Sept. 1 each year; schedule software and policy updates in Q4 so systems and staff are ready for Jan. 1 effective dates.

Take three immediate steps:

  1. Update income-calculation software and CHARTConnect templates with the Jan. 1, 2026 effective date and 0.40% passbook rate.
  2. Train staff on the $52,787 imputed-income threshold and $105,574 eligibility cutoff; update tenant notices and recertification checklists.
  3. Document all calculations in tenant files and flag cases where ownership interest in property may change eligibility.

Related Articles

HUD’s 2026 passbook rate is small, 0.40%, but it matters. It determines when and how much imputed asset income counts at certifications, affects eligibility for housing programs above $105,574, and forces systems and staff to update by Jan. 1, 2026. Agencies that update software, follow the step-by-step calculation, and avoid common mistakes will keep certifications clean and compliant.

This article was created with AI assistance.