Renters Tax Credit Act of 2014

To amend the Internal Revenue Code of 1986 to provide a renter’s credit. 1. Short title This Act may be cited as the Renters Tax Credit Act of 2014 2. Renters tax credit (a) In general Subpart D of part IV of subchapter A of chapter 1 45S. Renters credit (a) In general For purposes of section 38, in the case of a qualified credit recipient, the renters credit for any taxable year is an amount equal to the sum of the renter’s credit amounts allocated to such qualified credit recipient under this section for months ending during the taxable year. (b) Renter’s credit amount (1) In general For purposes of this section, the term renters credit amount (2) Qualified renter For purposes of this section, the term qualified renter (A) 60 percent of local median income, or (B) 150 percent of the Federal poverty line, in each case as determined by the Secretary of Housing and Urban Development for a family of the size involved. (3) Rent reduction amount For purposes of this section— (A) In general The term rent reduction amount (B) Limitation The rent reduction amount taken into account under this section shall not exceed the excess of— (i) the rent charged to the qualified renter (or, if lower, specified modest rent), over (ii) 30 percent of the qualified renter’s income (prorated monthly) as determined by the renters credit agency of the State. (C) Specified modest rent The term specified modest rent (i) the Fair Market Rent determined by the Secretary of Housing and Urban Development for the zip code (if the unit is located in a metropolitan area) or non-metropolitan county, or (ii) such amount as may be determined by the State with respect to the area in which the unit is located if such amount is within 25 percent of the amount determined under clause (i) with respect to such unit. (D) Utilities The renters credit agency of the State may determine whether and how to take into account the cost of utilities in determining the rent reduction amount. (E) Credit adjustment The renters credit agency of the State may elect to increase the rent reduction amount such that such amount does not exceed 110 percent of such amount as determined without regard to this subparagraph. (c) Qualified credit recipient For purposes of this section, the term qualified credit recipient (d) Allocations by renters credit agency to credit recipients (1) In general The renters credit agency may make allocations of renters credit amounts to qualified credit recipients under this section on the basis of— (A) the identity of the qualified renter, such that the renters credit amount is allowed to the owner of any rental unit which such qualified renter occupies (or the lender referred to in subsection (c)) for any month, or (B) one or more rental units, such that the renters credit amount is allowed to the owner of such units (or the lender referred to in subsection (c)) for such months as such units are occupied by a qualified renter. (2) Restrictions on unit based allocations A renters credit agency may make allocations of renters credit as described in paragraph (1)(B) only if— (A) such units are part of a project or building in which not more than 40 percent of the units receive allocations under this section (the Secretary may provide such exceptions to the requirement of this subparagraph as the Secretary determines appropriate for small buildings or buildings with respect to which more than 40 percent of the units were previously subsidized under other Federal programs), and (B) the Secretary has approved a mobility plan submitted by such renters credit agency which provides for an adequate method to ensure that qualified renters have the ability to move from a unit which is eligible for credit under this section without losing the rent subsidy provided by this section. (e) Allocations of credit authority to State agencies (1) Renters credit dollar amount for agencies (A) State limitation The aggregate credit amounts which a renters credit agency may allocate for any calendar year is the portion of the State renters credit ceiling allocated under this paragraph for such calendar year to such agency. (B) State ceiling initially allocated to State housing credit agencies Except as provided in subparagraphs (D) and (E), the State renters credit ceiling for each calendar year shall be allocated to the renters credit agency of such State. If there is more than 1 renters credit agency of a State, all such agencies shall be treated as a single agency. (C) State renters credit ceiling The State renters credit ceiling applicable to any State and any calendar year shall be an amount equal to the sum of— (i) the unused State renters credit ceiling (if any) of such State for the preceding calendar year, (ii) the greater of— (I) $17.50 multiplied by the State population, or (II) $20,000,000, (iii) the amount of State renters credit ceiling returned in the calendar year, plus (iv) the amount (if any) allocated under subparagraph (D) to such State by the Secretary. For purposes of clause (i), the unused State renters credit ceiling for any calendar year is the excess (if any) of the sum of the amounts described in clauses (ii) through (iv) over the aggregate renters credit dollar amount allocated for such year. (D) Unused renters credit carryovers allocated among certain States (i) In general The unused renters credit carryover of a State for any calendar year shall be assigned to the Secretary for allocation among qualified States for the succeeding calendar year. (ii) Unused renters credit carryover For purposes of this subparagraph, the unused renters credit carryover of a State for any calendar year is the excess (if any) of— (I) the unused State renters credit ceiling for the year preceding such year, over (II) the aggregate renters credit dollar amount allocated for such year. (iii) Formula for allocation of unused housing credit carryovers among qualified States The amount allocated under this subparagraph to a qualified State for any calendar year shall be the amount determined by the Secretary to bear the same ratio to the aggregate unused renters credit carryovers of all States for the preceding calendar year as such State's population for the calendar year bears to the population of all qualified States for the calendar year. For purposes of the preceding sentence, population shall be determined in accordance with section 146(j). (iv) Qualified State For purposes of this subparagraph, the term qualified State (I) which allocated its entire State renters credit ceiling for the preceding calendar year, and (II) for which a request is made (not later than May 1 of the calendar year) to receive an allocation under clause (iii). (E) Application of certain rules For purposes of this paragraph, rules similar to the rules of subparagraphs (E), (F), and (G) of section 42(h)(3) shall apply. (F) Inflation adjustment (i) In general In the case of a calendar year after 2013, the $20,000,000 and $17.50 amounts in subparagraph (C) shall each be increased by an amount equal to— (I) such dollar amount, multiplied by (II) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting calendar year 2001 calendar year 1992 (ii) Rounding (I) In the case of the $20,000,000 amount, any increase under clause (i) which is not a multiple of $50,000 shall be rounded to the next lowest multiple of $50,000. (II) In the case of the $17.50 amount, any increase under clause (i) which is not a multiple of 50 cents shall be rounded to the next lowest multiple of 50 cents. (f) Other definitions For purposes of this section— (1) Renters credit agency The term renters credit agency (2) Possessions treated as States The term State (g) Regulations The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section. . (b) Credit To be part of general business credit (1) In general Subsection (b) of section 38 of such Code is amended by striking plus , plus (37) the renters credit determined under section 45S(a). . (2) Credit allowable against alternative minimum tax Subparagraph (B) of section 38(c)(4) of such Code is amended by redesignating clauses (vii) through (ix) as clauses (viii) through (x), respectively, and by inserting after clause (vi) the following new clause: (vii) the credit determined under section 45S, . (c) Clerical amendment The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item: Sec. 45S. Renters credit. . (d) Effective date The amendments made by this section shall apply to allocations made for calendar years after 2014 and to taxable years ending after December 31, 2014.

Summary: Renters Tax Credit Act of 2014 - Amends the Internal Revenue Code to allow a business-related tax credit for a portion of the rent paid by a qualified renter. Defines "qualified renter" as a family unit with income not greater than the higher of 60% of local median income or 150% of the federal poverty line. Establishes the amount of such credit as the rent reduction amount, which: (1) is the amount by which the fair market rent for a rental unit exceeds the rent charged to the qualified renter; and (2) shall not exceed the excess of the rent charged to the qualified renter (or, if lower, specified modest rent) over 30% of the qualified renter's income (prorated monthly).