Us Congress 2025-2026 Regular Session

Us Congress House Bill HB1745 Compare Versions

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Old	New	Differences
1	1	I
2	2	119THCONGRESS
3	3	1
4	4	STSESSION H. R. 1745
5	5	To amend the Internal Revenue Code of 1986 to impose an excise tax
6	6	on the failure of certain hedge funds owning excess single-family resi-
7	7	dences to dispose of such residences, and for other purposes.
8	8	IN THE HOUSE OF REPRESENTATIVES
9	9	FEBRUARY27, 2025
10	10	Mr. S
11	11	MITHof Washington (for himself and Ms. SA´NCHEZ) introduced the
12	12	following bill; which was referred to the Committee on Ways and Means
13	13	A BILL
14	14	To amend the Internal Revenue Code of 1986 to impose
15	15	an excise tax on the failure of certain hedge funds own-
16	16	ing excess single-family residences to dispose of such
17	17	residences, and for other purposes.
18	18	Be it enacted by the Senate and House of Representa-1
19	19	tives of the United States of America in Congress assembled, 2
20	20	SECTION 1. SHORT TITLE. 3
21	21	This Act may be cited as the ‘‘Humans over Private 4
22	22	Equity for Homeownership Act’’ or the ‘‘HOPE for 5
23	23	Homeownership Act’’. 6
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26	26	•HR 1745 IH
27	27	SEC. 2. EXCISE TAX ON CERTAIN TAXPAYERS FAILING TO 1
28	28	SELL EXCESS SINGLE-FAMILY RESIDENCES. 2
29	29	(a) I
30	30	NGENERAL.—Subtitle D of the Internal Rev-3
31	31	enue Code of 1986 is amended by adding at the end the 4
32	32	following new chapter: 5
33	33	‘‘CHAPTER 50B—EXCESS SINGLE-FAMILY 6
34	34	RESIDENCES 7
35	35	‘‘Sec. 5000E. Newly acquired single-family residences.
36	36	‘‘Sec. 5000F. Excess single-family residences.
37	37	‘‘Sec. 5000G. Definitions and other special rules.
38	38	‘‘SEC. 5000E. NEWLY ACQUIRED SINGLE-FAMILY RESI-
39	39	8
40	40	DENCES. 9
41	41	‘‘(a) I
42	42	NGENERAL.—In the case of a hedge fund tax-10
43	43	payer, there is hereby imposed a tax on the acquisition 11
44	44	of any newly acquired single-family residence equal to the 12
45	45	greater of— 13
46	46	‘‘(1) 15 percent of the purchase price, or 14
47	47	‘‘(2) $10,000 15
48	48	‘‘(b) N
49	49	EWLYACQUIREDSINGLE-FAMILYRESI-16
50	50	DENCE.—For purposes of this section, the term ‘newly ac-17
51	51	quired single-family residence’ means any single-family 18
52	52	residence which was acquired by the taxpayer in any tax-19
53	53	able year which begins after the date of the enactment 20
54	54	of this chapter. 21
55	55	‘‘(c) P
56	56	URCHASEPRICE.—For purposes of this sec-22
57	57	tion, the term ‘purchase price’ means the adjusted basis 23
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60	60	•HR 1745 IH
61	61	of the newly acquired single-family residence on the date 1
62	62	such residence is purchased. 2
63	63	‘‘SEC. 5000F. EXCESS SINGLE-FAMILY RESIDENCES. 3
64	64	‘‘(a) I
65	65	NGENERAL.—In the case of an applicable tax-4
66	66	payer who fails to meet the requirements of subsection (b), 5
67	67	there is hereby imposed a tax equal to the product of— 6
68	68	‘‘(1) $5,000, and 7
69	69	‘‘(2) the excess of— 8
70	70	‘‘(A) the number of applicable single-family 9
71	71	residences owned by the taxpayer as of the last 10
72	72	day of the taxable year, over 11
73	73	‘‘(B) the maximum permissible units for 12
74	74	the taxable year. 13
75	75	‘‘(b) R
76	76	EQUIREMENT.— 14
77	77	‘‘(1) I
78	78	N GENERAL.—An applicable taxpayer 15
79	79	meets the requirement of this subsection for any tax-16
80	80	able year if the number of applicable single-family 17
81	81	residences owned by the taxpayer as of the last day 18
82	82	of the taxable year is equal to or less than the max-19
83	83	imum permissible units determined with respect to 20
84	84	such taxpayer for such taxable year. 21
85	85	‘‘(2) S
86	86	PECIAL RULE FOR CERTAIN SALES .—For 22
87	87	purposes of applying paragraph (1), a single-family 23
88	88	residence which is sold or transferred in a disquali-24
89	89	fied sale during the taxable year shall be treated as 25
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93	93	a single-family residence which is owned by the ap-1
94	94	plicable taxpayer as of the last day of such taxable 2
95	95	year. 3
96	96	‘‘(c) M
97	97	AXIMUMPERMISSIBLEUNITS.—The max-4
98	98	imum permissible units with respect to any applicable tax-5
99	99	payer for any taxable year shall be determined as follows: 6
100	100	‘‘In the case of—
101	101	The maximum permis-
102	102	sible units for a hedge
103	103	fund taxpayer is—
104	104	The maximum permis-
105	105	sible units for any other
106	106	applicable taxpayer is—
107	107	the first full taxable year
108	108	beginning after the ap-
109	109	plicable date . . .
110	110	90 percent of the num-
111	111	ber of applicable sin-
112	112	gle-family residences
113	113	owned by the taxpayer
114	114	on the applicable date
115	115	50 plus 90 percent of the
116	116	number of applicable
117	117	single-family resi-
118	118	dences owned by the
119	119	taxpayer on the appli-
120	120	cable date
121	121	the second taxable year
122	122	beginning after the ap-
123	123	plicable date . . .
124	124	80 percent of the num-
125	125	ber of applicable sin-
126	126	gle-family residences
127	127	owned by the taxpayer
128	128	on the applicable date
129	129	50 plus 80 percent of the
130	130	number of applicable
131	131	single-family resi-
132	132	dences owned by the
133	133	taxpayer on the appli-
134	134	cable date
135	135	the third taxable year be-
136	136	ginning after the ap-
137	137	plicable date . . .
138	138	70 percent of the num-
139	139	ber of applicable sin-
140	140	gle-family residences
141	141	owned by the taxpayer
142	142	on the applicable date
143	143	50 plus 70 percent of the
144	144	number of applicable
145	145	single-family resi-
146	146	dences owned by the
147	147	taxpayer on the appli-
148	148	cable date
149	149	the fourth taxable year
150	150	beginning after the ap-
151	151	plicable date . . .
152	152	60 percent of the num-
153	153	ber of applicable sin-
154	154	gle-family residences
155	155	owned by the taxpayer
156	156	on the applicable date
157	157	50 plus 60 percent of the
158	158	number of applicable
159	159	single-family resi-
160	160	dences owned by the
161	161	taxpayer on the appli-
162	162	cable date
163	163	the fifth taxable year be-
164	164	ginning after the ap-
165	165	plicable date . . .
166	166	50 percent of the num-
167	167	ber of applicable sin-
168	168	gle-family residences
169	169	owned by the taxpayer
170	170	on the applicable date
171	171	50 plus 50 percent of the
172	172	number of applicable
173	173	single-family resi-
174	174	dences owned by the
175	175	taxpayer on the appli-
176	176	cable date
177	177	the sixth taxable year be-
178	178	ginning after the ap-
179	179	plicable date . . .
180	180	40 percent of the num-
181	181	ber of applicable sin-
182	182	gle-family residences
183	183	owned by the taxpayer
184	184	on the applicable date
185	185	50 plus 40 percent of the
186	186	number of applicable
187	187	single-family resi-
188	188	dences owned by the
189	189	taxpayer on the appli-
190	190	cable date
191	191	the seventh taxable year
192	192	beginning after the ap-
193	193	plicable date . . .
194	194	30 percent of the num-
195	195	ber of applicable sin-
196	196	gle-family residences
197	197	owned by the taxpayer
198	198	on the applicable date
199	199	50 plus 30 percent of the
200	200	number of applicable
201	201	single-family resi-
202	202	dences owned by the
203	203	taxpayer on the appli-
204	204	cable date
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208	208	‘‘In the case of—
209	209	The maximum permis-
210	210	sible units for a hedge
211	211	fund taxpayer is—
212	212	The maximum permis-
213	213	sible units for any other
214	214	applicable taxpayer is—
215	215	the eighth taxable year
216	216	beginning after the ap-
217	217	plicable date . . .
218	218	20 percent of the num-
219	219	ber of applicable sin-
220	220	gle-family residences
221	221	owned by the taxpayer
222	222	on the applicable date
223	223	50 plus 20 percent of the
224	224	number of applicable
225	225	single-family resi-
226	226	dences owned by the
227	227	taxpayer on the appli-
228	228	cable date
229	229	the ninth taxable year
230	230	beginning after the ap-
231	231	plicable date . . .
232	232	10 percent of the num-
233	233	ber of applicable sin-
234	234	gle-family residences
235	235	owned by the taxpayer
236	236	on the applicable date
237	237	50 plus 10 percent of the
238	238	number of applicable
239	239	single-family resi-
240	240	dences owned by the
241	241	taxpayer on the appli-
242	242	cable date
243	243	any taxable year begin-
244	244	ning more than 9
245	245	years after the applica-
246	246	ble date . . .
247	247	0 50.
248	248	‘‘(d) DEFINITIONS.—For purposes of this section— 1
249	249	‘‘(1) A
250	250	PPLICABLE SINGLE -FAMILY RESI -2
251	251	DENCE.—The term ‘applicable single-family resi-3
252	252	dence’ means any single-family residence which was 4
253	253	acquired on or before the applicable date. 5
254	254	‘‘(2) A
255	255	PPLICABLE DATE.— 6
256	256	‘‘(A) I
257	257	N GENERAL.—The term ‘applicable 7
258	258	date’ means— 8
259	259	‘‘(i) the last day of the first full tax-9
260	260	able year ending on or after the date of the 10
261	261	enactment of this chapter, or 11
262	262	‘‘(ii) in the case of any taxpayer de-12
263	263	scribed in subparagraph (B), the date pro-13
264	264	vided in such subparagraph. 14
265	265	‘‘(B) T
266	266	AXPAYERS CHANGING STATUS .— 15
267	267	‘‘(i) I
268	268	N GENERAL.—In the case of any 16
269	269	applicable taxpayer described in clause (ii), 17
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273	273	the applicable date means the last day of 1
274	274	the taxable year immediately preceding the 2
275	275	taxable year in which the taxpayer is de-3
276	276	scribed in such clause. 4
277	277	‘‘(ii) A
278	278	PPLICABLE TAXPAYER DE -5
279	279	SCRIBED.—An applicable taxpayer is de-6
280	280	scribed in this clause with respect to any 7
281	281	taxable year if— 8
282	282	‘‘(I) such taxpayer was not a 9
283	283	hedge fund taxpayer for the preceding 10
284	284	taxable year, and 11
285	285	‘‘(II) such taxpayer is a hedge 12
286	286	fund taxpayer for such taxable year. 13
287	287	‘‘(3) D
288	288	ISQUALIFIED SALE.—The term ‘disquali-14
289	289	fied sale’ means any sale or transfer to— 15
290	290	‘‘(A) a corporation or other entity engaged 16
291	291	in a trade or business, or 17
292	292	‘‘(B) an individual who owns any other sin-18
293	293	gle-family residence at the time of such sale or 19
294	294	transfer. 20
295	295	‘‘SEC. 5000G. DEFINITIONS AND OTHER SPECIAL RULES. 21
296	296	‘‘(a) A
297	297	PPLICABLETAXPAYER.—For purposes of this 22
298	298	chapter— 23
299	299	‘‘(1) I
300	300	N GENERAL.—The term ‘applicable tax-24
301	301	payer’ means any applicable entity which— 25
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305	305	‘‘(A) manages funds pooled from investors, 1
306	306	and 2
307	307	‘‘(B) is a fiduciary with respect to such in-3
308	308	vestors. 4
309	309	‘‘(2) A
310	310	PPLICABLE ENTITY.— 5
311	311	‘‘(A) I
312	312	N GENERAL.—The term ‘applicable 6
313	313	entity’ means— 7
314	314	‘‘(i) any partnership, 8
315	315	‘‘(ii) any corporation, or 9
316	316	‘‘(iii) any real estate investment trust. 10
317	317	‘‘(B) E
318	318	XCEPTIONS.—The term ‘applicable 11
319	319	entity’ shall not include— 12
320	320	‘‘(i) an organization which is de-13
321	321	scribed in section 501(c)(3) and exempt 14
322	322	from tax under section 501(a), or 15
323	323	‘‘(ii) an organization which is pri-16
324	324	marily engaged in the construction or reha-17
325	325	bilitation of single-family residences and 18
326	326	which offers such residences for sale in the 19
327	327	ordinary course of business. 20
328	328	‘‘(b) H
329	329	EDGEFUNDTAXPAYER.—For purposes of 21
330	330	this section, the term ‘hedge fund taxpayer’ means, with 22
331	331	respect to any taxable year, any applicable taxpayer which 23
332	332	has $50,000,000 or more in net value or assets under 24
333	333	management on any day during the taxable year. 25
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337	337	‘‘(c) SINGLE-FAMILYRESIDENCE.—For purposes of 1
338	338	this chapter— 2
339	339	‘‘(1) I
340	340	N GENERAL.—The term ‘single-family 3
341	341	residence’ means a residential property consisting of 4
342	342	1-to-4 dwelling units. 5
343	343	‘‘(2) E
344	344	XCEPTIONS.—A residential property shall 6
345	345	not be treated as a residential property described in 7
346	346	clause (i) if— 8
347	347	‘‘(A) such property is unoccupied and ac-9
348	348	quired through foreclosure (other than such a 10
349	349	residence acquired through foreclosure by a 11
350	350	hedge fund taxpayer, as defined in section 12
351	351	5000F((d)(3)), 13
352	352	‘‘(B) such property is— 14
353	353	‘‘(i) not rented or leased, and 15
354	354	‘‘(ii) used as the principal residence 16
355	355	(within the meaning of section 121) of any 17
356	356	person who has an ownership interest in 18
357	357	the applicable taxpayer, or 19
358	358	‘‘(C) such property— 20
359	359	‘‘(i) was a building with respect to 21
360	360	which a credit was allowed under section 22
361	361	42 (relating to the low-income housing 23
362	362	credit), and 24
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366	366	‘‘(ii) is not owned by a hedge fund 1
367	367	taxpayer (as defined in section 2
368	368	5000F(d)(3)). 3
369	369	‘‘(d) A
370	370	CQUISITION; OWNERSHIP.—For purposes of 4
371	371	this chapter, an applicable taxpayer shall be treated— 5
372	372	‘‘(1) as acquiring a single-family residence if 6
373	373	the applicable taxpayer acquires a majority owner-7
374	374	ship interest in the single-family residence, regard-8
375	375	less of the percentage of that ownership interest, 9
376	376	and 10
377	377	‘‘(2) as owning a single-family residence if the 11
378	378	applicable taxpayer owns a majority ownership inter-12
379	379	est in the single-family residence, regardless of the 13
380	380	percentage of that ownership interest. 14
381	381	‘‘(e) A
382	382	GGREGATIONRULES.— 15
383	383	‘‘(1) I
384	384	N GENERAL.—For purposes of this chap-16
385	385	ter, all persons which are treated as a single em-17
386	386	ployer under subsections (a) and (b) of section 52 18
387	387	shall be treated as a single person. 19
388	388	‘‘(2) M
389	389	ODIFICATIONS.—For purposes of this 20
390	390	subsection— 21
391	391	‘‘(A) section 52(a) shall be applied by sub-22
392	392	stituting ‘component members’ for ‘members’, 23
393	393	and 24
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397	397	‘‘(B) for purposes of applying section 1
398	398	52(b), the term ‘trade or business’ shall include 2
399	399	any activity treated as a trade or business 3
400	400	under paragraph (5) or (6) of section 469(c) 4
401	401	(determined without regard to the phrase ‘To 5
402	402	the extent provided in regulations’ in such para-6
403	403	graph (6)). 7
404	404	‘‘(3) C
405	405	OMPONENT MEMBER .—For purposes of 8
406	406	this paragraph, the term ‘component member’ has 9
407	407	the meaning given such term by section 1563(b), ex-10
408	408	cept that the determination shall be made without 11
409	409	regard to section 1563(b)(2).’’. 12
410	410	(b) C
411	411	LERICALAMENDMENT.—The table of chapters 13
412	412	for subtitle D of the Internal Revenue Code of 1986 is 14
413	413	amended by adding at the end the following new item: 15
414	414	‘‘CHAPTER50B—EXCESSSINGLE-FAMILYRESIDENCES’’.
415	415	(c) EFFECTIVEDATE.—The amendments made by 16
416	416	this section shall apply to taxable years beginning after 17
417	417	the date of enactment of this Act. 18
418	418	SEC. 3. DISALLOWANCE OF MORTGAGE INTEREST AND DE-19
419	419	PRECIATION IN CONNECTION WITH SINGLE 20
420	420	FAMILY RESIDENCES OWNED BY COVERED 21
421	421	TAXPAYERS. 22
422	422	(a) M
423	423	ORTGAGEINTEREST.— 23
424	424	(1) I
425	425	N GENERAL.—Section 163 of the Internal 24
426	426	Revenue Code of 1986 is amended by redesignating 25
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429	429	•HR 1745 IH
430	430	subsection (n) as subsection (o) and by inserting 1
431	431	after subsection (m) the following new subsection: 2
432	432	‘‘(n) C
433	433	ERTAININTERESTPAID BYCOVEREDTAX-3
434	434	PAYERS.— 4
435	435	‘‘(1) I
436	436	N GENERAL.—No deduction shall be al-5
437	437	lowed under this chapter for a taxable year with re-6
438	438	spect to interest paid or accrued on acquisition in-7
439	439	debtedness with respect to any single-family resi-8
440	440	dence if the owner of such single-family residence is 9
441	441	liable for tax under chapter 50B for such taxable 10
442	442	year. 11
443	443	‘‘(2) D
444	444	EFINITIONS.—For purposes of this sub-12
445	445	section— 13
446	446	‘‘(A) A
447	447	CQUISITION INDEBTEDNESS .—The 14
448	448	term ‘acquisition indebtedness’ has the meaning 15
449	449	given such term under subsection (h)(3)(B), de-16
450	450	termined— 17
451	451	‘‘(i) by substituting ‘single-family resi-18
452	452	dence (as defined in section 5000G(b))’ for 19
453	453	‘qualified residence’, and 20
454	454	‘‘(ii) without regard to clause (ii) 21
455	455	thereof. 22
456	456	‘‘(B) S
457	457	INGLE-FAMILY RESIDENCE .—The 23
458	458	term ‘single-family residence’ has the meaning 24
459	459	given such term under section 5000G(b) 25
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463	463	‘‘(C) OWNERSHIP.—The rules of section 1
464	464	5000G(c) shall apply for purposes of deter-2
465	465	mining ownership.’’. 3
466	466	(2) E
467	467	FFECTIVE DATE.—The amendments made 4
468	468	by this subsection shall apply to taxable years begin-5
469	469	ning after the date of the enactment of this Act. 6
470	470	(b) D
471	471	EPRECIATION.— 7
472	472	(1) I
473	473	N GENERAL.—Section 167 of the Internal 8
474	474	Revenue Code of 1986 is amended by redesignating 9
475	475	subsection (i) as subsection (j) and by inserting after 10
476	476	subsection (h) the following new subsection: 11
477	477	‘‘(i) D
478	478	EDUCTIONDISALLOWED FOR DISQUALIFIED 12
479	479	S
480	480	INGLEFAMILYPROPERTYOWNERS.— 13
481	481	‘‘(1) I
482	482	N GENERAL.—No deduction shall be al-14
483	483	lowed under this section for a taxable year with re-15
484	484	spect to a single-family residence if the owner of 16
485	485	such single-family residence is liable for tax under 17
486	486	chapter 50B for such taxable year. 18
487	487	‘‘(2) D
488	488	EFINITIONS.—For purposes of this sub-19
489	489	section— 20
490	490	‘‘(A) S
491	491	INGLE-FAMILY RESIDENCE .—The 21
492	492	term ‘single-family residence’ has the meaning 22
493	493	given such term under section 5000G(b). 23
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497	497	‘‘(B) OWNERSHIP.—The rules of section 1
498	498	5000G(c) shall apply for purposes of deter-2
499	499	mining ownership.’’. 3
500	500	(2) E
501	501	FFECTIVE DATE.—The amendments made 4
502	502	by this subsection shall apply to taxable years begin-5
503	503	ning after the date of the enactment of this Act. 6
504	504	Æ
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