Affordable HOUSE Act

I 116TH CONGRESS 1ST SESSION H. R. 3478 To amend the Internal Revenue Code of 1986 to modify the low-income housing credit basis limitation rules in the case the acquisition of an existing building. IN THE HOUSE OF REPRESENTATIVES JUNE 25, 2019 Mr. NEGUSE introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend the Internal Revenue Code of 1986 to modify the low-income housing credit basis limitation rules in the case the acquisition of an existing building. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Affordable Housing 4 Opportunities for Utilization, Sustainment, and Expan- 5 sion Act of 2019’’ or the ‘‘Affordable HOUSE Act’’. 6 SEC. 2. MODIFICATION OF PREVIOUS OWNERSHIP RULES; 7 LIMITATION ON ACQUISITION BASIS. 8 (a) LIMITATION ON ACQUISITION BASIS.— 9 VerDate Sep 11 2014 02:32 Jul 03, 2019 Jkt 034408 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3478.IH H3478 pbinns on DSK79D2C42PROD with BILLS 2 •HR 3478 IH (1) IN GENERAL.—Section 42(d)(2)(B)(ii) of 1 the Internal Revenue Code of 1986 is amended by 2 inserting ‘‘, or the taxpayer elects the application of 3 subparagraph (C)(ii)’’ after ‘‘service’’. 4 (2) LIMITATION.—Section 42(d)(2)(C) of such 5 Code is amended— 6 (A) by striking ‘‘for purposes of subpara- 7 graph (A), the adjusted basis’’ and inserting 8 the following: ‘‘For purposes of subparagraph 9 (A)— 10 ‘‘(i) IN GENERAL.—The adjusted 11 basis’’, and 12 (B) by adding at the end the following new 13 clauses: 14 ‘‘(ii) BUILDINGS IN SERVICE WITHIN 15 PREVIOUS 10 YEARS.—If the period be- 16 tween the date of acquisition of the build- 17 ing by the taxpayer and the date the build- 18 ing was last placed in service is less than 19 10 years, the taxpayer’s basis attributable 20 to the acquisition of the building which is 21 taken into account in determining the ad- 22 justed basis shall not exceed the sum of— 23 ‘‘(I) the lowest amount paid for 24 acquisition of the building by any per- 25 VerDate Sep 11 2014 02:32 Jul 03, 2019 Jkt 034408 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3478.IH H3478 pbinns on DSK79D2C42PROD with BILLS 3 •HR 3478 IH son during the 10 years preceding the 1 date of the acquisition of the building 2 by the taxpayer, adjusted as provided 3 in clause (iii), and 4 ‘‘(II) the value of any capital im- 5 provements made by the person who 6 sells the building to the taxpayer 7 which are reflected in such seller’s 8 basis. 9 ‘‘(iii) ADJUSTMENT.—With respect to 10 a basis determination made in any taxable 11 year, the amount described in clause (ii)(I) 12 shall be increased by an amount equal to— 13 ‘‘(I) such amount, multiplied by 14 ‘‘(II) a cost-of-living adjustment, 15 determined in the same manner as 16 under section 1(f)(3) for the calendar 17 year in which the taxable year begins 18 by taking into account the acquisition 19 year in lieu of calendar year 2016 in 20 subparagraph (A)(ii) thereof. 21 For purposes of the preceding sentence, 22 the acquisition year is the calendar year in 23 which the lowest amount referenced in 24 VerDate Sep 11 2014 02:32 Jul 03, 2019 Jkt 034408 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3478.IH H3478 pbinns on DSK79D2C42PROD with BILLS 4 •HR 3478 IH clause (ii)(I) was paid for the acquisition 1 of the building.’’. 2 (3) CONFORMING AMENDMENTS.—Section 3 42(d)(2)(D)(i) of such Code is amended— 4 (A) by striking ‘‘FOR SUBPARAGRAPH (B)’’ 5 in the heading, and 6 (B) by striking ‘‘subparagraph (B)’’ in the 7 matter preceding subclause (I) and inserting 8 ‘‘subparagraph (B)(ii) or (C)(ii)’’. 9 (b) MODIFICATION OF PLACED IN SERVICE RULE.— 10 Section 42(d)(2)(B)(iii) of such Code is amended to read 11 as follows: 12 ‘‘(iii) the building was not owned by 13 the taxpayer or by any person related (as 14 of the date of acquisition by the taxpayer) 15 to the taxpayer at any time during the 5- 16 year period ending on the date of acquisi- 17 tion by the taxpayer, and’’. 18 (c) EFFECTIVE DATE.—The amendments made by 19 this section shall apply to buildings placed in service after 20 December 31, 2018. 21 Æ VerDate Sep 11 2014 02:32 Jul 03, 2019 Jkt 034408 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\H3478.IH H3478 pbinns on DSK79D2C42PROD with BILLS