I
107TH CONGRESS
1ST SESSION
H. R. 3000
To amend the Internal Revenue Code of 1986 to allow a business credit
for the development of low-to-moderate income housing for home owner-
ship, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
OCTOBER 2, 2001
Mr. SHOWS 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
business credit for the development of low-to-moderate
income housing for home ownership, and for other pur-
poses.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; ETC.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Low-to-Moderate Income Home Ownership Tax Credit
Act’’.
(b) TABLE OF CONTENTS.—The table of contents for
this Act is as follows:
Sec. 1. Short title; etc.
Sec. 2. Credit for low-to-moderate income housing for home ownership.
Sec. 3. Partial exclusion of gain from sale of low-to-moderate income housing.
Sec. 4. Expansion of rehabilitation credit.
SEC. 2. CREDIT FOR LOW-TO-MODERATE INCOME HOUSING
FOR HOME OWNERSHIP.
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to business related credits) is amended by
adding at the end the following:
‘‘SEC. 42A. LOW-TO-MODERATE INCOME HOME OWNERSHIP
CREDIT.
‘‘(a) IN GENERAL.—For purposes of section 38, the
amount of the home ownership credit determined under
this section for any taxable year in the credit period shall
be an amount equal to the applicable percentage of the
qualified basis of each qualified low-to-moderate income
building.
‘‘(b) APPLICABLE
PERCENTAGE: 
PERCENT
PRESENT VALUE CREDIT FOR NEW BUILDINGS; 30 PER-
CENT PRESENT VALUE CREDIT FOR EXISTING BUILD-
INGS.—For purposes of this section—
‘‘(1) IN GENERAL.—The term ‘applicable per-
centage’ means the appropriate percentage pre-
scribed by the Secretary for the earlier of—
‘‘(A) the first month of the credit period
with respect to a low-to-moderate income build-
ing, or
‘‘(B) at the election of the taxpayer, the
month in which the taxpayer and the housing
credit agency enter into an agreement with re-
spect to such building (which is binding on such
agency, the taxpayer, and all successors in in-
terest) as to the housing credit dollar amount
to be allocated to such building.
A month may be elected under subparagraph (B)
only if the election is made not later than the 5th
day after the close of such month. Such an election,
once made, shall be irrevocable.
‘‘(2) METHOD
OF
PRESCRIBING
PERCENT-
AGES.—The percentages prescribed by the Secretary
for any month shall be percentages which will yield
over a 10-year period amounts of credit under sub-
section (a) which have a present value equal to—
‘‘(A) 70 percent of the qualified basis of a
new building, and
‘‘(B) 30 percent of the qualified basis of
an existing building.
‘‘(3) METHOD OF DISCOUNTING.—The present
value under paragraph (2) shall be determined—
‘‘(A) as of the last day of the 1st year of
the 10-year period referred to in paragraph (2),
‘‘(B) by using a discount rate equal to 72
percent of the average of the annual Federal
mid-term rate and the annual Federal long-
term rate applicable under section 1274(d)(1)
to the month applicable under subparagraph
(A) or (B) of paragraph (1) and compounded
annually, and
‘‘(C) by assuming that the credit allowable
under this section for any year is received on
the last day of such year.
‘‘(c) QUALIFIED BASIS; ELIGIBLE BASIS; QUALIFIED
LOW-TO-MODERATE INCOME BUILDING.—For purposes
of this section—
‘‘(1) QUALIFIED BASIS.—
‘‘(A) 
DETERMINATION.—The 
qualified
basis of any qualified low-to-moderate income
building for any taxable year is an amount
equal to—
‘‘(i) the applicable fraction (deter-
mined as of the close of such taxable year)
of
‘‘(ii) the eligible basis of such build-
ing.