II 

117TH CONGRESS 

2D SESSION S. 4728 

To amend the Internal Revenue Code of 1986 to allow for a credit against 

tax for rent paid on the personal residence of the taxpayer. 

IN THE SENATE OF THE UNITED STATES 

AUGUST 2, 2022 

Mr. WARNOCK introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to allow for 

a credit against tax for rent paid on the personal residence of the taxpayer. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Rent Relief Act of 

5 2022’’. 

6 SEC. 2. REFUNDABLE CREDIT FOR RENT PAID FOR PRIN7 CIPAL RESIDENCE. 

8 (a) IN GENERAL.—Subpart C of part IV of sub9 chapter A of chapter 1 of the Internal Revenue Code of 


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1 1986 is amended by inserting after section 36B the fol2 lowing new section: 

3 ‘‘SEC. 36C. RENT PAID FOR PRINCIPAL RESIDENCE. 

4 ‘‘(a) IN GENERAL.—In the case of an individual who 

5 leases the individual’s principal residence (within the 

6 meaning of section 121) during the taxable year and who 

7 pays rent with respect to such residence in excess of 30 

8 percent of the taxpayer’s gross income for such taxable 

9 year, there shall be allowed as a credit against the tax 

10 imposed by this subtitle for such taxable year an amount 

11 equal to the applicable percentage of such excess. 

12 ‘‘(b) CREDIT LIMITED BY 100 PERCENT OF SMALL

13 AREA FAIR MARKET RENT.—Solely for purposes of deter14 mining the amount of the credit allowed under subsection 

15 (a) with respect to a residence for the taxable year, there 

16 shall not be taken into account rent in excess of an 

17 amount equal to 100 percent of the small area fair market 

18 rent (including the utility allowance) applicable to the resi19 dence involved (as most recently published, as of the be20 ginning of the taxable year, by the Department of Housing 

21 and Urban Development). 

22 ‘‘(c) DEFINITIONS AND SPECIAL RULES.—For pur23 poses of this section— 

24 ‘‘(1) APPLICABLE PERCENTAGE.— 


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1 ‘‘(A) IN GENERAL.—Except as provided in 

2 subparagraph (B), the applicable percentage 

3 shall be determined in accordance with the fol4 lowing table: 

The applicable 

‘‘If gross income is: percentage is: 

Not over $25,000 .............................................................. 100 percent

Over $25,000, but not over $50,000 ................................ 75 percent

Over $50,000, but not over $75,000 ................................ 50 percent

Over $75,000, but not over $100,000 .............................. 25 percent

Over $100,000 .................................................................. 0 percent. 

5 ‘‘(B) HIGH-COST AREAS.—In the case of 

6 an individual whose principal residence is lo7 cated in an area designated by the Secretary of 

8 Housing and Urban Development as an area 

9 which has high construction, land, or utility 

10 costs relative to area median gross income for 

11 purposes of section 42(d)(5), each of the dollar 

12 amounts in the table contained in subparagraph 

13 (A) shall be increased by $25,000. 

14 ‘‘(2) PARTIAL YEAR RESIDENCE.—The Sec15 retary shall prescribe such rules as are necessary to 

16 carry out the purposes of this section for taxpayers 

17 with respect to whom a residence is a principal resi18 dence for only a portion of the taxable year. 

19 ‘‘(3) SPECIAL RULE FOR INDIVIDUALS RESID20 ING IN GOVERNMENT-SUBSIDIZED HOUSING.—In the 

21 case of a principal residence— 


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1 ‘‘(A) the rent with respect to which is sub2 sidized under a Federal, State, local, or tribal 

3 program, and 

4 ‘‘(B) with respect to which the taxpayer 

5 elects the application of this paragraph, 

6 in lieu of the credit determined under subsection (a), 

7 there shall be allowed as a credit against the tax im8 posed by this subtitle for such taxable year an 

amount equal to 1 9 ⁄12 of the amount of rent paid by 

10 the taxpayer (and not subsidized under any such 

11 program) during the taxable year with respect to 

12 such residence. 

13 ‘‘(4) RENT.—The term ‘rent’ includes any 

14 amount paid for utilities of a type taken into ac15 count for purposes of determining the utility allow16 ance under section 42(g)(2)(B)(ii). 

17 ‘‘(d) RECONCILIATION OF CREDIT AND ADVANCE

18 PAYMENTS.—The amount of the credit allowed under this 

19 section for any taxable year shall be reduced (but not 

20 below zero) by the aggregate amount of any advance pay21 ments of such credit under section 7527A for such taxable 

22 year. 

23 ‘‘(e) TERMINATION.—This section shall not apply to 

24 taxable years beginning after December 31, 2024.’’. 


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1 (b) ADVANCE PAYMENT.—Chapter 77 of the Internal 

2 Revenue Code of 1986 is amended by inserting after sec3 tion 7527 the following new section: 

4 ‘‘SEC. 7527A. ADVANCE PAYMENT OF MIDDLE CLASS TAX 

5 CREDIT. 

6 ‘‘(a) IN GENERAL.—Not later than 6 months after 

7 the date of the enactment of the Rent Relief Act of 2022, 

8 the Secretary shall establish a program for making ad9 vance payments of the credit allowed under section 36C 

10 on a monthly basis to any taxpayer who— 

11 ‘‘(1) the Secretary has determined will be al12 lowed such credit for the taxable year, and 

13 ‘‘(2) has made an election under subsection (c). 

14 ‘‘(b) AMOUNT OF ADVANCE PAYMENT.— 

15 ‘‘(1) IN GENERAL.—For purposes of subsection 

16 (a), the amount of the monthly advance payment of 

17 the credit provided to a taxpayer during the applica18 ble period shall be equal to the lesser of— 

19 ‘‘(A) an amount equal to— 

20 ‘‘(i) the amount of the credit which 

21 the Secretary has determined will be al22 lowed to such taxpayer under section 36C 

23 for the taxable year ending in such applica24 ble period, divided by 

25 ‘‘(ii) 12, or 


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1 ‘‘(B) such other amount as is elected by 

2 the taxpayer. 

3 ‘‘(2) APPLICABLE PERIOD.—For purposes of 

4 this section, the term ‘applicable period’ means the 

5 12-month period from the month of July of the tax6 able year through the month of June of the subse7 quent taxable year. 

8 ‘‘(c) ELECTION OF ADVANCE PAYMENT.—A taxpayer 

9 may elect to receive an advance payment of the credit al10 lowed under section 36C for any taxable year by including 

11 such election on a timely filed return for the preceding 

12 taxable year. 

13 ‘‘(d) INTERNAL REVENUE SERVICE NOTIFICA14 TION.—The Internal Revenue Service shall take such 

15 steps as may be appropriate to ensure that taxpayers who 

16 are eligible to receive the credit under section 36C are 

17 aware of the availability of the advance payment of such 

18 credit under this section. 

19 ‘‘(e) AUTHORITY.—The Secretary may prescribe such 

20 regulations or other guidance as may be appropriate or 

21 necessary for the purposes of carrying out this section.’’. 

22 (c) CLERICAL AMENDMENTS.— 

23 (1) IN GENERAL.—The table of sections for 

24 subpart C of part IV of subchapter A of chapter 1 

25 of the Internal Revenue Code of 1986 is amended by 


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1 inserting after the item relating to section 36B the 

2 following new item: 

‘‘Sec. 36C. Rent paid for principal residence.’’. 

3 (2) ADVANCE PAYMENT.—The table of sections 

4 for chapter 77 of such Code is amended by inserting 

5 after the item relating to section 7527 the following 

6 new item: 

‘‘Sec. 7527A. Advance payment of middle class tax credit.’’. 

7 (d) EFFECTIVE DATE.—The amendments made by 

8 this section shall apply to taxable years beginning after 

9 December 31, 2022. 

Æ 


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