II 

116TH CONGRESS 

2D SESSION S. 4078 

To amend the Internal Revenue Code of 1986 to improve the low-income 

housing credit and provide relief relating to the coronavirus emergency, 

and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JUNE 25, 2020 

Mr. WYDEN (for himself, Ms. CANTWELL, Mr. BENNET, and Mr. CARDIN) 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 improve 

the low-income housing credit and provide relief relating 

to the coronavirus emergency, and for other purposes. 

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 ‘‘Emergency Affordable 

5 Housing Act of 2020’’. 

6 SEC. 2. EXTENSION OF PERIOD FOR REHABILITATION EX7 PENDITURES. 

8 (a) IN GENERAL.—Clause (ii) of section 42(e)(3)(A) 

9 of the Internal Revenue Code of 1986 is amended by inVerDate Sep 11 2014 06:09 Jul 08, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S4078.IS S4078

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1 serting ‘‘(any 36-month period, in the case of buildings 

2 receiving an allocation of housing credit dollar amount be3 fore January 1, 2022)’’ after ‘‘24-month period’’. 

4 (b) CONFORMING AMENDMENT.—Subparagraph (A) 

5 of section 42(e)(4) of the Internal Revenue Code of 1986 

6 is amended by inserting ‘‘(or 36-month period, if applica7 ble)’’ after ‘‘24-month period’’. 

8 (c) EFFECTIVE DATE.—The amendments made by 

9 this section shall apply to buildings receiving an allocation 

10 of housing credit dollar amount after December 31, 2016. 

11 SEC. 3. EXTENSION OF BASIS EXPENDITURE DEADLINE. 

12 (a) IN GENERAL.—Clause (i) of section 42(h)(1)(E) 

13 of the Internal Revenue Code of 1986 is amended by in14 serting ‘‘(the third calendar year, in the case of an alloca15 tion made before January 1, 2022)’’ after ‘‘second cal16 endar year’’. 

17 (b) QUALIFIED BUILDING.—Clause (ii) of section 

18 42(h)(1)(E) of the Internal Revenue Code of 1986 is 

19 amended— 

20 (1) by striking ‘‘the date which is 1 year after 

21 the date that the allocation was made’’ and inserting 

22 ‘‘the applicable date’’; 

23 (2) by inserting ‘‘(or third, if applicable)’’ after 

24 ‘‘second’’ in the first sentence; 


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1 (3) by inserting ‘‘(or third)’’ after ‘‘second’’ in 

2 the second sentence; 

3 (4) by striking ‘‘BUILDING.—For purposes of’’ 

4 and inserting ‘‘BUILDING.— 

5 ‘‘(I) IN GENERAL.—For purposes 

6 of’’; and 

7 (5) by adding at the end the following new sub8 clause: 

9 ‘‘(II) APPLICABLE DATE.—For 

10 purposes of subclause (I), the applica11 ble date is 1 year after the date that 

12 the allocation was made with respect 

13 to the building (2 years, in the case of 

14 allocations made before January 1, 

15 2022).’’. 

16 (c) EFFECTIVE DATE.—The amendments made by 

17 this section shall apply to buildings receiving an allocation 

18 of housing credit dollar amount after December 31, 2016. 

19 SEC. 4. TAX-EXEMPT BOND FINANCING REQUIREMENT. 

20 (a) IN GENERAL.—Subparagraph (B) of section 

21 42(h)(4) of the Internal Revenue Code of 1986 is amended 

22 by adding at the end the following: ‘‘In the case of build23 ings financed by an obligation issued in calendar years 

24 ending before January 1, 2022, the preceding sentence 


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1 shall be applied by substituting ‘25 percent’ for ‘50 per2 cent’.’’. 

3 (b) EFFECTIVE DATE.—The amendment made by 

4 this section shall apply to buildings placed in service in 

5 taxable years beginning after December 31, 2019. 

6 SEC. 5. MINIMUM CREDIT RATE. 

7 (a) IN GENERAL.—Subsection (b) of section 42 of the 

8 Internal Revenue Code of 1986 is amended— 

9 (1) by redesignating paragraph (3) as para10 graph (4); and 

11 (2) by inserting after paragraph (2) the fol12 lowing new paragraph: 

13 ‘‘(3) MINIMUM CREDIT RATE.—In the case of 

14 any new or existing building to which paragraph (2) 

15 does not apply, the applicable percentage shall not 

16 be less than 4 percent.’’. 

17 (b) EFFECTIVE DATE.—The amendments made by 

18 this section shall apply to buildings which receive alloca19 tions of housing credit dollar amount or, in the case of 

20 projects financed by tax-exempt bonds as described in sec21 tion 42(h)(4) of the Internal Revenue Code of 1986, which 

22 are placed in service by the taxpayer after January 20, 

23 2020. 


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1 SEC. 6. INCREASES IN STATE ALLOCATIONS. 

2 (a) IN GENERAL.—Clause (ii) of section 42(h)(3)(C) 

3 of the Internal Revenue Code of 1986 is amended— 

4 (1) by striking ‘‘$1.75’’ in subclause (I) and in5 serting ‘‘$4.56 ($3.58 in the case of calendar year 

6 2021)’’; and 

7 (2) by striking ‘‘$2,000,000’’ in subclause (II) 

8 and inserting ‘‘$5,214,051 ($4,097,486 in the case 

9 of calendar year 2021)’’. 

10 (b) COST-OF-LIVING ADJUSTMENT.—Subparagraph 

11 (H) of section 42(h)(3) of the Internal Revenue Code of 

12 1986 is amended— 

13 (1) by striking ‘‘2002’’ in clause (i) and insert14 ing ‘‘2020’’; 

15 (2) by striking ‘‘the $2,000,000 and $1.75 

16 amounts in subparagraph (C)’’ in clause (i) and in17 serting ‘‘the dollar amounts applicable to such cal18 endar year under subclauses (I) and (II) of subpara19 graph (C)(ii)’’; 

20 (3) by striking ‘‘2001’’ in clause (i)(II) and in21 serting ‘‘2019’’; 

22 (4) by striking ‘‘$2,000,000 amount’’ in clause 

23 (ii)(I) and inserting ‘‘amount under subparagraph 

24 (C)(ii)(II)’’; and 


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1 (5) by striking ‘‘$1.75 amount’’ in clause 

2 (ii)(II) and inserting ‘‘amount under subparagraph 

3 (C)(ii)(I)’’. 

4 (c) EFFECTIVE DATE.—The amendments made by 

5 this section shall apply to calendar years beginning after 

6 December 31, 2020. 

7 SEC. 7. INCREASE IN CREDIT FOR CERTAIN PROJECTS DES8 IGNATED TO SERVE EXTREMELY LOW-IN9 COME HOUSEHOLDS. 

10 (a) IN GENERAL.—Paragraph (5) of section 42(d) of 

11 the Internal Revenue Code of 1986 is amended by adding 

12 at the end the following new subparagraph: 

13 ‘‘(C) INCREASE IN CREDIT FOR PROJECTS

14 DESIGNATED TO SERVE EXTREMELY LOW-IN15 COME HOUSEHOLDS.—In the case of any build16 ing— 

17 ‘‘(i) 20 percent or more of the resi18 dential units in which are rent-restricted 

19 (determined as if the imputed income limi20 tation applicable to such units were 30 

21 percent of area median gross income) and 

22 are designated by the taxpayer for occu23 pancy by households the aggregate house24 hold income of which does not exceed the 

25 greater of— 


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1 ‘‘(I) 30 percent of area median 

2 gross income, or 

3 ‘‘(II) 100 percent of an amount 

4 equal to the Federal poverty line 

5 (within the meaning of section 

6 36B(d)(3)), and 

7 ‘‘(ii) which is designated by the hous8 ing credit agency as requiring the increase 

9 in credit under this subparagraph in order 

10 for such building to be financially feasible 

11 as part of a qualified low-income housing 

12 project, 

13 subparagraph (B) shall not apply to the portion 

14 of such building which is comprised of such 

15 units, and the eligible basis of such portion of 

16 the building shall be 150 percent of such basis 

17 determined without regard to this subpara18 graph.’’. 

19 (b) RESERVED STATE ALLOCATION.—Subparagraph 

20 (C) of section 42(h)(3) of the Internal Revenue Code of 

21 1986 is amended— 

22 (1) by striking ‘‘plus’’ at the end of clause (iii); 

23 (2) by striking the period at the end of clause 

24 (iv) and inserting ‘‘, plus’’; 


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1 (3) by inserting after clause (iv) the following 

2 new clause: 

3 ‘‘(v) an amount equal to 10 percent of 

4 the sum of the amounts determined under 

5 clauses (i), (ii), (iii), and (iv) (if any).’’; 

6 and 

7 (4) by adding at the end the following: ‘‘Any 

8 amount allocated pursuant to clause (v) shall be ac9 counted for separately and shall be allocated only to 

10 buildings to which subsection (d)(5)(C) applies.’’. 

11 (c) EFFECTIVE DATE.—The amendments made by 

12 this section shall apply to buildings which receive alloca13 tions of housing credit dollar amount or, in the case of 

14 projects financed by tax-exempt bonds as described in sec15 tion 42(h)(4) of the Internal Revenue Code of 1986, which 

16 receive a determination of housing credit dollar amount, 

17 after the date of the enactment of this Act. 

18 SEC. 8. INCLUSION OF INDIAN AREAS AS DIFFICULT DE19 VELOPMENT AREAS FOR PURPOSES OF CER20 TAIN BUILDINGS. 

21 (a) IN GENERAL.—Subclause (I) of section 

22 42(d)(5)(B)(iii) of the Internal Revenue Code of 1986 is 

23 amended by inserting before the period the following: ‘‘, 

24 and any Indian area’’. 


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1 (b) INDIAN AREA.—Clause (iii) of section 

2 42(d)(5)(B) of the Internal Revenue Code of 1986 is 

3 amended by redesignating subclause (II) as subclause (IV) 

4 and by inserting after subclause (I) the following new sub5 clauses: 

6 ‘‘(II) INDIAN AREA.—For pur7 poses of subclause (I), the term ‘In8 dian area’ means any Indian area (as 

9 defined in section 4(11) of the Native 

10 American Housing Assistance and 

11 Self Determination Act of 1996 (25 

12 U.S.C. 4103(11))). 

13 ‘‘(III) SPECIAL RULE FOR

14 BUILDINGS IN INDIAN AREAS.—In the 

15 case of an area which is a difficult de16 velopment area solely because it is an 

17 Indian area, a building shall not be 

18 treated as located in such area unless 

19 such building is assisted or financed 

20 under the Native American Housing 

21 Assistance and Self Determination 

22 Act of 1996 (25 U.S.C. 4101 et seq.) 

23 or the project sponsor is an Indian 

24 tribe (as defined in section 

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1 ing entity (as defined in section 4(22) 

2 of such Act (25 U.S.C. 4103(22))), or 

3 wholly owned or controlled by such an 

4 Indian tribe or tribally designated 

5 housing entity.’’. 

6 (c) EFFECTIVE DATE.—The amendments made by 

7 this section shall apply to buildings placed in service after 

8 December 31, 2019. 

9 SEC. 9. INCLUSION OF RURAL AREAS AS DIFFICULT DEVEL10 OPMENT AREAS. 

11 (a) IN GENERAL.—Subclause (I) of section 

12 42(d)(5)(B)(iii) of the Internal Revenue Code of 1986, as 

13 amended by section 8, is amended by inserting ‘‘, any 

14 rural area’’ after ‘‘median gross income’’. 

15 (b) RURAL AREA.—Clause (iii) of section 

16 42(d)(5)(B) of the Internal Revenue Code of 1986, as 

17 amended by section 8, is further amended by redesig18 nating subclause (IV) as subclause (V) and by inserting 

19 after subclause (III) the following new subclause: 

20 ‘‘(IV) RURAL AREA.—For pur21 poses of subclause (I), the term ‘rural 

22 area’ means any non-metropolitan 

23 area, or any rural area as defined by 

24 section 520 of the Housing Act of 

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1 fied allocation plan under subsection 

2 (m)(1)(B).’’. 

3 (c) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply to buildings placed in service after 

5 December 31, 2019. 

6 SEC. 10. INCREASE IN CREDIT FOR BOND-FINANCED 

7 PROJECTS DESIGNATED BY HOUSING CREDIT 

8 AGENCY. 

9 (a) IN GENERAL.—Clause (v) of section 42(d)(5)(B) 

10 of the Internal Revenue Code of 1986 is amended by strik11 ing the second sentence. 

12 (b) TECHNICAL AMENDMENT.—Clause (v) of section 

13 42(d)(5)(B) of the Internal Revenue Code of 1986, as 

14 amended by subsection (a), is further amended— 

15 (1) by striking ‘‘STATE’’ in the heading; and 

16 (2) by striking ‘‘State housing credit agency’’ 

17 and inserting ‘‘housing credit agency’’. 

18 (c) EFFECTIVE DATE.—The amendments made by 

19 this section shall apply to buildings which receive a deter20 mination of housing credit dollar amount after the date 

21 of the enactment of this Act. 

22 SEC. 11. REPEAL OF QUALIFIED CONTRACT OPTION. 

23 (a) TERMINATION OF OPTION FOR CERTAIN BUILD24 INGS.— 


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1 (1) IN GENERAL.—Subclause (II) of section 

2 42(h)(6)(E)(i) of the Internal Revenue Code of 1986 

3 is amended by inserting ‘‘in the case of a building 

4 described in clause (iii),’’ before ‘‘on the last day’’. 

5 (2) BUILDINGS DESCRIBED.—Subparagraph 

6 (E) of section 42(h)(6) of such Code is amended by 

7 adding at the end the following new clause: 

8 ‘‘(iii) BUILDINGS DESCRIBED.—A 

9 building described in this clause is a build10 ing— 

11 ‘‘(I) which received its allocation 

12 of housing credit dollar amount before 

13 January 1, 2020, or 

14 ‘‘(II) in the case of a building 

15 any portion of which is financed as 

16 described in paragraph (4), which re17 ceived before January 1, 2020, a de18 termination from the issuer of the 

19 tax-exempt bonds or the housing cred20 it agency that the building is eligible 

21 to receive an allocation of housing 

22 credit dollar amount under the rules 

23 of paragraphs (1) and (2) of sub24 section (m).’’. 


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1 (b) RULES RELATING TO EXISTING PROJECTS.— 

2 Subparagraph (F) of section 42(h)(6) of the Internal Rev3 enue Code of 1986 is amended by striking ‘‘the nonlow4 income portion’’ and all that follows and inserting ‘‘the 

5 nonlow-income portion and the low-income portion of the 

6 building for fair market value (determined by the housing 

7 credit agency by taking into account the rent restrictions 

8 required for the low-income portion of the building to con9 tinue to meet the standards of paragraphs (1) and (2) of 

10 subsection (g)). The Secretary shall prescribe such regula11 tions as may be necessary or appropriate to carry out this 

12 paragraph.’’. 

13 (c) CONFORMING AMENDMENTS.— 

14 (1) Paragraph (6) of section 42(h) of the Inter15 nal Revenue Code of 1986 is amended by striking 

16 subparagraph (G) and by redesignating subpara17 graphs (H), (I), (J), and (K) as subparagraphs (G), 

18 (H), (I), and (J), respectively. 

19 (2) Subclause (II) of section 42(h)(6)(E)(i) of 

20 such Code, as amended by subsection (a), is further 

21 amended by striking ‘‘subparagraph (I)’’ and insert22 ing ‘‘subparagraph (H)’’. 

23 (d) TECHNICAL AMENDMENT.—Subparagraph (I) of 

24 section 42(h)(6) of the Internal Revenue Code of 1986, 


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1 as redesignated by subsection (c), is amended by striking 

2 ‘‘agreement’’ and inserting ‘‘commitment’’. 

3 (e) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply to buildings with respect to which 

5 a written request described in section 42(h)(6)(H) of the 

6 Internal Revenue Code of 1986 is submitted after the date 

7 of the enactment of this Act. 

8 SEC. 12. PROHIBITION OF LOCAL APPROVAL AND CON9 TRIBUTION REQUIREMENTS. 

10 (a) IN GENERAL.—Paragraph (1) of section 42(m) 

11 of the Internal Revenue Code of 1986 is amended— 

12 (1) by striking clause (ii) of subparagraph (A) 

13 and by redesignating clauses (iii) and (iv) thereof as 

14 clauses (ii) and (iii); and 

15 (2) by adding at the end the following new sub16 paragraph: 

17 ‘‘(E) LOCAL APPROVAL OR CONTRIBUTION

18 NOT TAKEN INTO ACCOUNT.—The selection cri19 teria under a qualified allocation plan shall not 

20 include consideration of— 

21 ‘‘(i) any support or opposition with re22 spect to the project from local or elected 

23 officials, or 

24 ‘‘(ii) any local government contribu25 tion to the project, except to the extent 


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1 such contribution is taken into account as 

2 part of a broader consideration of the 

3 project’s ability to leverage outside funding 

4 sources, and is not prioritized over any 

5 other source of outside funding.’’. 

6 (b) EFFECTIVE DATE.—The amendments made by 

7 this section shall apply to allocations of housing credit dol8 lar amounts made after December 31, 2020. 

9 SEC. 13. ADJUSTMENT OF CREDIT TO PROVIDE RELIEF 

10 DURING COVID–19 OUTBREAK. 

11 (a) IN GENERAL.—At the election of a taxpayer who 

12 is an owner of an eligible low-income building— 

13 (1) the credit determined under section 42 of 

14 the Internal Revenue Code of 1986 for the first or 

15 second taxable year of such building’s credit period 

16 ending on or after July 1, 2020, shall be 150 per17 cent of the amount which would (but for this sub18 section) be so allowable with respect to such building 

19 for such taxable year; and 

20 (2) the aggregate credits allowable under such 

21 section with respect to such building shall be re22 duced, on a pro rata basis for each subsequent tax23 able year in the credit period, by the increase in the 

24 credit allowed by reason of paragraph (1) with re25 spect to such first or second taxable year. 


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1 The preceding sentence shall not be construed to affect 

2 whether any taxable year is part of the credit, compliance, 

3 or extended use periods for purposes of such section 42. 

4 (b) ELIGIBLE LOW-INCOME BUILDING.—For pur5 poses of this section, the term ‘‘eligible low-income build6 ing’’ means a qualified low-income building with respect 

7 to which— 

8 (1) the first year in the credit period ends on 

9 or after July 1, 2020, and before July 1, 2022; and 

10 (2) construction or leasing delays have occurred 

11 after January 31, 2020, due to the outbreak of 

12 coronavirus disease 2019 (COVID–19) in the United 

13 States. 

14 (c) ELECTION.— 

15 (1) IN GENERAL.—The election under sub16 section (a) shall be made at such time and in such 

17 manner as shall be prescribed by the Secretary of 

18 the Treasury (or the Secretary’s delegate) and, once 

19 made, shall be irrevocable by the taxpayer and any 

20 successor in ownership. 

21 (2) PARTNERSHIPS.—In the case of an eligible 

22 low-income building owned by a partnership or S 

23 corporation, such election shall be made at the entity 

24 level. 


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1 (3) CERTIFICATION.—An owner making such 

2 election shall provide to the housing credit agency, 

3 at the same time and in addition to such other infor4 mation as may be required under section 42(l)(1) of 

5 the Internal Revenue Code of 1986 with respect to 

6 the building, a certification that the purpose of mak7 ing such election is to offset any reductions in cap8 ital or additional costs arising by reason of the out9 break of coronavirus disease 2019 (COVID–19) in 

10 the United States. Such certification shall include 

11 any documentation which the housing credit agency 

12 may request. 

13 (d) DEFINITIONS.—Any term used in this section 

14 which is also used in section 42 of the Internal Revenue 

15 Code of 1986 shall have the same meaning as when used 

16 in such section. 

17 SEC. 14. CREDIT FOR LOW-INCOME HOUSING SUPPORTIVE 

18 SERVICES. 

19 (a) IN GENERAL.—Subpart D of part IV of sub20 chapter A of chapter 1 of the Internal Revenue Code of 

21 1986 is amended by inserting after section 42 the fol22 lowing new section: 


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1 ‘‘SEC. 42A. CREDIT FOR CONTRIBUTIONS TO LOW-INCOME 

2 HOUSING SUPPORTIVE SERVICES. 

3 ‘‘(a) IN GENERAL.—For purposes of section 38, the 

4 amount of the low-income housing supportive services 

5 credit determined under this section for the applicable tax6 able year is an amount equal to 25 percent of the qualified 

7 supportive housing contribution made by the taxpayer. 

8 ‘‘(b) QUALIFIED SUPPORTIVE HOUSING CONTRIBU9 TION.—For purposes of this section— 

10 ‘‘(1) IN GENERAL.—The term ‘qualified sup11 portive housing contribution’ means the total 

12 amount contributed in cash by the taxpayer to a 

13 qualified supportive housing reserve fund with re14 spect to a qualified low-income building, determined 

15 as of the date the building is placed in service. 

16 ‘‘(2) QUALIFIED SUPPORTIVE HOUSING RE17 SERVE FUND.—The term ‘qualified supportive hous18 ing reserve fund’ means, with respect to any quali19 fied low-income building, a separate fund reserved 

20 exclusively for payment for qualified supportive serv21 ices provided to tenants of the building pursuant to 

22 an extended supportive services commitment. The 

23 owner of such building shall designate an adminis24 trator to separately account for the amounts in the 

25 fund in such manner as the Secretary may prescribe. 

26 ‘‘(3) LIMITATIONS.— 


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1 ‘‘(A) IN GENERAL.—No amount attrib2 utable to any governmental grant, including 

3 grants provided by the government of any 

4 State, possession, tribe, or locality, shall be 

5 taken into account under paragraph (1). 

6 ‘‘(B) DOLLAR LIMITATION.—The total 

7 qualified supportive housing contributions taken 

8 into account under this section with respect to 

9 any qualified low-income building shall not ex10 ceed— 

11 ‘‘(i) $120,000, multiplied by 

12 ‘‘(ii) the number of low-income units 

13 in the building which are occupied at the 

14 close of the applicable taxable year. 

15 ‘‘(c) APPLICABLE TAXABLE YEAR.—For purposes of 

16 this section, the term ‘applicable taxable year’ means the 

17 first taxable year in the credit period with respect to the 

18 qualified low-income building described in subsection 

19 (b)(1). 

20 ‘‘(d) QUALIFIED SUPPORTIVE SERVICES.—For pur21 poses of this section, the term ‘qualified supportive serv22 ices’ means services— 

23 ‘‘(1) provided by the owner of a qualified low24 income building (directly or through contracts with 


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1 a third party service provider) to tenants of the 

2 building, 

3 ‘‘(2) which include health services (including 

4 mental health services), coordination of tenant bene5 fits, job training, financial counseling, resident en6 gagement services, or services the principal purpose 

7 of which is to help tenants retain permanent hous8 ing, or such other services as the Secretary may by 

9 regulation provide, 

10 ‘‘(3) which are provided at no cost to tenants, 

11 and 

12 ‘‘(4) usage of or participation in which is not 

13 required for tenants. 

14 Such term includes reasonable and necessary measures for 

15 the provision of such services, including measures to en16 gage tenants in and coordinate such services and measures 

17 required to obtain the certification described in subsection 

18 (e)(4). 

19 ‘‘(e) EXTENDED SUPPORTIVE SERVICES COMMIT20 MENT.—The term ‘extended supportive services commit21 ment’ means any agreement between the owner of a quali22 fied low-income building and the housing credit agency 

23 which— 

24 ‘‘(1) requires that amounts in a qualified sup25 portive housing reserve fund are spent exclusively on 


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1 the provision of qualified supportive services to ten2 ants of such building, 

3 ‘‘(2) requires that the amounts in such fund be 

4 spent entirely during the extended use period, and 

5 provides for the manner in which such spending will 

6 be distributed across such period, 

7 ‘‘(3) requires the designation of one or more in8 dividuals to engage tenants regarding and coordinate 

9 delivery of qualified supportive services, 

10 ‘‘(4) requires the maintenance of an appro11 priate certification, as determined by the Secretary 

12 in consultation with the housing credit agencies, for 

13 qualified supportive services, subject to recertifi14 cation at least once every 5 years, 

15 ‘‘(5) requires appropriate annual reporting to 

16 the housing credit agency on expenditures and out17 comes, as determined by such agency, and 

18 ‘‘(6) is binding on all successors in ownership of 

19 such building. 

20 ‘‘(f) RECAPTURE OF QUALIFIED SUPPORTIVE HOUS21 ING RESERVE AMOUNTS.— 

22 ‘‘(1) IN GENERAL.—If the owner of a qualified 

23 low-income building is determined to be noncompli24 ant with the extended supportive services commit25 ment or extended low-income housing commitment 


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1 with respect to such building, any remaining 

2 amounts in the qualified supportive housing reserve 

3 fund with respect to such building shall be trans4 ferred to the housing credit agency. 

5 ‘‘(2) USE OF REPAYMENTS.—A housing credit 

6 agency shall use any amount received pursuant to 

7 paragraph (1) only for purposes of qualified low-in8 come buildings. 

9 ‘‘(g) SPECIAL RULES.— 

10 ‘‘(1) IN GENERAL.—Notwithstanding any other 

11 provision of this section, no credit shall be allowed 

12 under this section for any taxable year with respect 

13 to any qualified low-income building unless— 

14 ‘‘(A) the building has received an alloca15 tion of the low-income housing credit under sec16 tion 42 by a housing credit agency which is ap17 proved by the governmental unit (in accordance 

18 with rules similar to the rules of section 

19 147(f)(2) (other than subparagraph (B)(ii) 

20 thereof)) of which such agency is a part, 

21 ‘‘(B) the housing credit agency sets forth 

22 selection criteria to determine appropriate, evi23 dence-based supportive services and provides a 

24 procedure that the agency (or an agent or other 

25 private contractor of such agency) will follow in 


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1 monitoring for noncompliance with the provi2 sions of this section and in reporting such non3 compliance to the Secretary, 

4 ‘‘(C) an extended low-income housing com5 mitment is in effect with respect to such build6 ing as of the end of such taxable year, 

7 ‘‘(D) an extended supportive services com8 mitment is in effect with respect to such build9 ing as of the end of such taxable year, and 

10 ‘‘(E) appropriate books and records for 

11 itemized expenses and expenditures with respect 

12 to the qualified supportive housing reserve fund 

13 are maintained on an annual basis, and are 

14 available for inspection upon request by the 

15 housing credit agency. 

16 ‘‘(2) DENIAL OF DOUBLE BENEFIT.—The de17 ductions otherwise allowed under this chapter for the 

18 taxable year shall be reduced by the amount of the 

19 credit allowed under this section for such taxable 

20 year. 

21 ‘‘(h) DEFINITIONS.—Any term used in this section 

22 which is also used in section 42 shall have the same mean23 ing as when used in such section.’’. 

24 (b) CREDIT TO BE PART OF GENERAL BUSINESS

25 CREDIT.— 


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1 (1) IN GENERAL.—Section 38(b) of the Internal 

2 Revenue Code of 1986 is amended by striking 

3 ‘‘plus’’ at the end of paragraph (32), by striking the 

4 period at the end of paragraph (33) and inserting ‘‘, 

5 plus’’, and by adding at the end the following new 

6 paragraph: 

7 ‘‘(34) the low-income housing supportive serv8 ices credit determined under section 42A(a).’’. 

9 (2) TREATMENT AS SPECIFIED CREDIT.— 

10 Clause (iii) of section 38(c)(4)(B) of such Code is 

11 amended by inserting ‘‘, and the credit determined 

12 under section 42A’’ after ‘‘2007’’. 

13 (c) TREATMENT FOR PURPOSES OF TAX ON BASE

14 EROSION PAYMENTS.—Paragraph (4) of section 59A(b) 

15 of the Internal Revenue Code of 1986 is amended by re16 designating subparagraphs (B) and (C) as subparagraphs 

17 (C) and (D), respectively, and by inserting after subpara18 graph (A) the following new subparagraph: 

19 ‘‘(B) the low-income housing supportive 

20 services credit determined under section 

21 42A(a),’’. 

22 (d) PASSIVE ACTIVITY CREDITS.— 

23 (1) IN GENERAL.—Section 469 of the Internal 

24 Revenue Code of 1986 is amended by striking ‘‘42’’ 


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25 

•S 4078 IS

1 each place it appears in subsections (i)(3)(C), 

2 (i)(6)(B)(i), and (k)(1) and inserting ‘‘42 or 42A’’. 

3 (2) CONFORMING AMENDMENTS.—The head4 ings of subsections (i)(3)(C) and (i)(6)(B) of section 

5 469 of such Code are each amended by striking 

6 ‘‘CREDIT’’ and inserting ‘‘CREDITS’’. 

7 (e) CLERICAL AMENDMENT.—The table of sections 

8 for subpart D of part IV of subchapter A of chapter 1 

9 of the Internal Revenue Code of 1986 is amended by in10 serting after the item relating to section 42 the following 

11 new item: 

‘‘Sec. 42A. Credit for contributions to low-income housing supportive services.’’. 

12 (f) EFFECTIVE DATE.—The amendments made by 

13 this section shall apply to buildings placed in service after 

14 December 31, 2020. 

Æ 


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