Home > 106th Congressional Bills > H.R. 83 (ih) To modify the provision of law which provides a permanent appropriation for the compensation of Members of Congress, and for other purposes. [Introduced in House] ...H.R. 83 (ih) To modify the provision of law which provides a permanent appropriation for the compensation of Members of Congress, and for other purposes. [Introduced in House] ...
allocate available homeownership credit dollar
amounts to a qualified residence prior to the
year of sale of such qualified residence if--
``(I) the taxpayer owns fee title
or a leasehold interest of not less
than 50 years in the site of the
qualified residence as of the later of
the date which is 6 months after the
date that the allocation was made or
the close of the calendar year in which
the allocation is made, and
``(II) such qualified residence is
completed not later than the close of
the second calendar year following
the calendar year in which the allocation was made.
``(C) Vested right to credit dollar amount.--Once a
homeownership credit allocation is received by a
taxpayer, the right to such credit is vested in such
taxpayer and is not subject to recapture, except as
provided in paragraph (5)(B).
``(2) Homeownership credit dollar amount for agencies.--
``(A) In general.--The aggregate homeownership
credit dollar amount which a homeownership credit
agency may allocate for any calendar year is the
portion of the State homeownership credit ceiling
allocated under this paragraph for such calendar year
to such agency.
``(B) State ceiling initially allocated to state
homeownership credit agencies.--Except as provided in
subparagraphs (D) and (E), the State homeownership
credit ceiling for each calendar year shall be
allocated to the homeownership credit agency of such
State. If there is more than 1 homeownership credit
agency of a State, all such agencies shall be treated
as a single agency.
``(C) State homeownership credit ceiling.--The
State homeownership credit ceiling applicable to any
State for any calendar year shall be an amount equal to
the sum of--
``(i) the unused State homeownership credit
ceiling (if any) of such State for the
preceding calendar year,
``(ii) the greater of--
``(I) $1.75 multiplied by the State
population, or
``(II) $2,000,000,
``(iii) the amount of State homeownership
credit ceiling returned in the calendar year,
plus
``(iv) the amount (if any) allocated under
subparagraph (D) to such State by the
Secretary.
For purposes of clause (i), the unused State
homeownership credit ceiling for any calendar year is
the excess (if any) of the sum of the amounts described
in clauses (ii) through (iv) over the aggregate
homeownership credit dollar amount allocated for such
year. For purposes of clause (iii), the amount of State
homeownership credit ceiling returned in the calendar
year equals the homeownership credit dollar amount
previously allocated within the State to any qualified
residence with respect to which an allocation is
canceled by mutual consent of the homeownership credit
agency and the allocation recipient.
``(D) Unused homeownership credit carryovers
allocated among certain states.--
``(i) In general.--The unused homeownership
credit carryover of a State for any calendar
year shall be assigned to the Secretary for
allocation among qualified States for the
succeeding calendar year.
``(ii) Unused homeownership credit
carryover.--For purposes of this subparagraph,
the unused homeownership credit carryover of a
State for any calendar year is the excess (if
any) of--
``(I) the unused State
homeownership credit ceiling for the
year preceding such year, over
``(II) the aggregate homeownership
credit dollar amount allocated for such
year.
``(iii) Formula for allocation of unused
homeownership credit carryovers among qualified
states.--The amount allocated under this
subparagraph to a qualified State for any
calendar year shall be the amount determined by
the Secretary to bear the same ratio to the
aggregate unused homeownership credit
carryovers of all States for the preceding
calendar year as such State's population for
the calendar year bears to the population of
all qualified States for the calendar year.
``(iv) Qualified state.--For purposes of
this subparagraph, the term `qualified State'
means, with respect to a calendar year, any
State--
``(I) which allocated its entire
State homeownership credit ceiling for
the preceding calendar year, and
``(II) for which a request is made
(not later than May 1 of the calendar
year) to receive an allocation under
clause (iii).
``(E) State may provide for different allocation.--
Rules similar to the rules of section 146(e) (other
than paragraph (2)(B) thereof) shall apply for purposes
of this paragraph.
``(F) Population.--For purposes of this paragraph,
population shall be determined in accordance with
section 146(j).
``(G) Cost-of-living adjustment.--
``(i) In general.--In the case of a
calendar year after 2003, the $2,000,000 and
$1.75 amounts in subparagraph (C) shall each be
increased by an amount equal to--
``(I) such dollar amount,
multiplied by
``(II) the cost-of-living
adjustment determined under section
1(f)(3) for such calendar year by
substituting `calendar year 2002' for
`calendar year 1992' in subparagraph
(B) thereof.
``(ii) Rounding.--
``(I) In the case of the $2,000,000
amount, any increase under clause (i)
which is not a multiple of $5,000 shall
be rounded to the next lowest multiple
of $5,000.
``(II) In the case of the $1.75
amount, any increase under clause (i)
which is not a multiple of 5 cents
shall be rounded to the next lowest
multiple of 5 cents.
``(3) Portion of state ceiling set-aside for certain
projects involving qualified nonprofit organizations.--
``(A) In general.--Not more than 90 percent of the
State homeownership credit ceiling for any State for
any calendar year shall be allocated to projects other
than qualified nonprofit housing projects described in
subparagraph (B).
``(B) Projects involving qualified nonprofit
organizations.--For purposes of subparagraph (A), a
qualified nonprofit housing project is described in
this subparagraph if a qualified nonprofit organization
is to own an interest in the project (directly or
through a partnership) and materially participate
(within the meaning of section 469(h)) in the
development and operation of the project throughout the
credit period.
``(C) Qualified nonprofit organization.--For
purposes of this paragraph, the term `qualified
nonprofit organization' means any organization if--
``(i) such organization is described in
paragraph (3) or (4) of section 501(c) and is
exempt from tax under section 501(a),
``(ii) such organization is determined by
the State homeownership credit agency not to be
affiliated with or controlled by a for-profit
organization, and
``(iii) 1 of the exempt purposes of such
organization includes the fostering of low-
income housing.
``(D) Treatment of certain subsidiaries.--
``(i) In general.--For purposes of this
paragraph, a qualified nonprofit organization
shall be treated as satisfying the ownership
and material participation test of subparagraph
(B) if any qualified corporation in which such
organization holds stock satisfies such test.
``(ii) Qualified corporation.--For purposes
of clause (i), the term `qualified corporation'
means any corporation if 100 percent of the
stock of such corporation is held by 1 or more
qualified nonprofit organizations at all times
during the period such corporation is in
existence.
``(E) State may not override set-aside.--Nothing in
subparagraph (E) of paragraph (2) shall be construed to
permit a State not to comply with subparagraph (A) of
this paragraph.
``(4) Limitation on allocations to areas of chronic
economic distress.--No more than 50 percent of a homeownership
credit agency's portion of the State homeownership credit
ceiling for a calendar year may be allocated to residences
located in areas that--
``(A) are designated as areas of chronic economic
distress in accordance with paragraph (1) of subsection
(c), and
``(B) that do not meet the requirements of clause
(i), (ii), or (iii) of subsection (c)(1)(A).
``(5) Special rules.--
``(A) Residence must be located within jurisdiction
of credit agency.--A homeownership credit agency may
allocate its aggregate homeownership credit dollar
amount only to qualified residences located in the
jurisdiction of the governmental unit of which such
agency is a part.
``(B) Agency allocations in excess of limit.--If
the aggregate homeownership credit dollar amounts
allocated by a homeownership credit agency for any
calendar year exceed the portion of the State
homeownership credit ceiling allocated to such agency
for such calendar year, the homeownership credit dollar
amounts so allocated shall be reduced (to the extent of
such excess) for residences in the reverse of the order
in which the allocations of such amounts were made.
``(g) Definitions and Special Rules.--For purposes of this
section--
``(1) Completed.--The term `completed' means the point in
time where a qualified residence is first placed in a condition
or state of readiness and availability for occupancy.
``(2) Project.--The term `project' means 1 or more
residences together with functionally related and subordinate
facilities developed and made available to inhabitants of such
residences, including recreational facilities and parking
areas. To constitute a project, each residence must--
``(A) be developed by the same taxpayer pursuant to
common planning and feasibility studies,
``(B) be financed through a common plan of
construction financing, and
``(C) have common ownership prior to sale.
For purposes of this paragraph, it is not necessary that all
residences within a project be contiguous or that all
residences consist only of either new residences or existing
residences and it is not necessary that each residence within a
project be a qualified residence.
``(3) Qualified buyer.--
``(A) In general.--The term `qualified buyer' means
a buyer if at the time of the acquisition of the
qualified residence, the buyer--
``(i) is 1 or more individuals whose income
does not exceed 80 percent of the area median
gross income (70 percent for families of less than 3 members), and
``(ii) intends to occupy the residence as
the buyer's principal residence (within the
meaning of section 121).
``(B) Special rules in qualified census tracts.--
With respect to residences located in qualified census
tracts (as defined in section 42), subparagraph (A)
shall be applied by substituting `100 percent' for `80
percent' and `90 percent' for `70 percent'.
``(C) Determination of income.--For purposes of
this paragraph, a buyer's income shall be determined in
accordance with section 143(f)(4).
``(4) New qualified residence.--The term `new qualified
residence' means a qualified residence the original ownership
of which begins with the taxpayer.
``(5) Existing qualified residence.--The term `existing
qualified residence' means any qualified residence which is not
a new qualified residence.
``(6) Homeownership credit agency.--The term `homeownership
credit agency' means any agency authorized to carry out this
section.
``(7) Possessions treated as states.--The term `State'
includes the District of Columbia and a possession of the
United States.
``(8) Application to estates and trusts.--In the case of an
estate or trust, the amount of the credit determined under
subsection (a) shall be apportioned between the estate or trust
and the beneficiaries on the basis of the income of the estate
or trust allocable to each.
``(h) Reduction in Tax Benefits.--
``(1) Recapture of credit.--If within the 5-year period
beginning on the date of the original purchase of a qualified
residence, the residence is sold, the qualified buyer--
``(A) shall deduct and withhold an amount equal to
the recapture amount from the amount realized on such
sale, and
``(B) shall transfer such amount to the
homeownership credit agency which allocated the
homeownership credit dollar amount to such residence.
``(2) Recapture amount.--For purposes of paragraph (1), the
recapture amount is an amount equal to the lesser of--
``(A) 50 percent of the gain from such resale, or
``(B) the homeownership credit dollar amount
allocated to such residence, reduced by 1/36th of such
amount for each month after the first 2 years of the 5-
year period referred to in paragraph (1) which is
before the date of the sale referred to in paragraph
(1).
``(3) Denial of deductions if converted to rental
housing.--If a qualified residence is converted to rental
housing within the 5-year period beginning on the date of the
original purchase of the qualified residence, no deduction
under this chapter shall be permitted to offset rental income
with respect to such residence during such period.
``(i) Application of At-Risk Rules.--For purposes of this section,
rules of section 465 shall not apply in determining the eligible basis
of any qualified residence.
``(j) Reports to the Secretary.--
``(1) From the taxpayer.--The Secretary may require
taxpayers to submit an information return (at such time and in
such form and manner as the Secretary prescribes) for each
taxable year setting forth--
``(A) the eligible basis for the taxable year of
each qualified residence with respect to which the
taxpayer is claiming a credit under this section,
``(B) the amount of all homeownership credit
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