United States HR 2143: Neighborhood Homes Investment Act

Bill Text

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117TH CONGRESS
1ST SESSION H. R. 2143
To amend the Internal Revenue Code of 1986 to allow a credit against
tax for neighborhood revitalization, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MARCH 23, 2021
Mr. HIGGINS of New York 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 allow a
credit against tax for neighborhood revitalization, and
for other purposes.
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 ‘‘Neighborhood Homes 4
Investment Act’’. 5
SEC. 2. NEIGHBORHOOD HOMES CREDIT. 6
(a) IN GENERAL.—Subpart D of part IV of sub-7
chapter A of chapter 1 of the Internal Revenue Code of 8
1986 is amended by inserting after section 42 the fol-9
lowing new section: 10
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‘‘SEC. 42A. NEIGHBORHOOD HOMES CREDIT. 1
‘‘(a) ALLOWANCE OF CREDIT.—For purposes of sec-2
tion 38, the amount of the neighborhood homes credit de-3
termined under this section for a taxable year for a quali-4
fied project shall be, with respect to each qualified resi-5
dence that is part of such qualified project and that expe-6
riences a qualified completion event during such taxable 7
year, an amount equal to— 8
‘‘(1) in the case of an affordable sale, with re-9
spect to the seller, the excess of— 10
‘‘(A) the qualified development cost in-11
curred by such seller for such qualified resi-12
dence, over 13
‘‘(B) the sale price of such qualified resi-14
dence, or 15
‘‘(2) in the case of any other qualified comple-16
tion event, with respect to a taxpayer other than the 17
owner of the qualified residence (or a related person 18
with respect to such owner), the excess of— 19
‘‘(A) the development cost incurred by 20
such taxpayer for such qualified residence, over 21
‘‘(B) the amount received by such taxpayer 22
as payment for such rehabilitation. 23
‘‘(b) LIMITATIONS.— 24
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‘‘(1) AMOUNT.—The amount determined under 1
subsection (a) with respect to a qualified residence 2
shall not exceed 35 percent of the lesser of— 3
‘‘(A) the qualified development cost, or 4
‘‘(B) 80 percent of the national median 5
sale price for new homes (as determined pursu-6
ant to the most recent census data available as 7
of the date on which the neighborhood homes 8
credit agency makes an allocation for the quali-9
fied project). 10
‘‘(2) ALLOCATIONS.— 11
‘‘(A) IN GENERAL.—The amount deter-12
mined under subsection (a) with respect to a 13
qualified residence that is part of a qualified 14
project and that experiences a qualified comple-15
tion event shall not exceed the excess of— 16
‘‘(i) the amount determined under 17
subparagraph (B), over 18
‘‘(ii) the amounts previously deter-19
mined under subsection (a) with respect to 20
such qualified project. 21
‘‘(B) ALLOCATION AMOUNT.—The amount 22
determined under this paragraph with respect 23
to a qualified residence that is part of a quali-24
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fied project and that experiences a qualified 1
completion event is the least of— 2
‘‘(i) the amount allocated to such 3
project by the neighborhood homes credit 4
agency under this section, 5
‘‘(ii) pursuant to subparagraph (C), 6
the amount such agency determines at the 7
time of the qualified completion event is 8
necessary to ensure the financial feasibility 9
of the project, or 10
‘‘(iii) in the case of a qualified com-11
pletion event that occurs after the 5-year 12
period beginning on the date of the alloca-13
tion referred to in clause (i), $0. 14
‘‘(C) FINANCIAL FEASIBILITY.—For pur-15
poses of subparagraph (B)(ii), the neighborhood 16
homes credit agency shall consider— 17
‘‘(i) the sources and uses of funds and 18
the total financing planned for the quali-19
fied project, 20
‘‘(ii) any proceeds or receipts expected 21
to be generated by reason of tax benefits, 22
‘‘(iii) the percentage of the amount al-23
located to such project under this section 24
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used for project costs other than the cost 1
of intermediaries, and 2
‘‘(iv) the reasonableness of the devel-3
opmental costs and fees of the qualified 4
project. 5
‘‘(c) QUALIFIED DEVELOPMENT COST.—For pur-6
poses of this section— 7
‘‘(1) IN GENERAL.—The term ‘qualified devel-8
opment cost’ means, with respect to a qualified resi-9
dence, so much of the allowable