I 
119TH CONGRESS 
1ST SESSION H. R. 1745 
To amend the Internal Revenue Code of 1986 to impose an excise tax 
on the failure of certain hedge funds owning excess single-family resi-
dences to dispose of such residences, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 27, 2025 
Mr. SMITH of Washington (for himself and Ms. SA´NCHEZ) 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 impose 
an excise tax on the failure of certain hedge funds own-
ing excess single-family residences to dispose of such 
residences, and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Humans over Private 
Equity for Homeownership Act’’ or the ‘‘HOPE for 
Homeownership Act’’. 
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SEC. 2. EXCISE TAX ON CERTAIN TAXPAYERS FAILING TO 
SELL EXCESS SINGLE-FAMILY RESIDENCES. 
(a) IN GENERAL.—Subtitle D of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following new chapter: 
‘‘CHAPTER 50B—EXCESS SINGLE-FAMILY 
RESIDENCES 
‘‘Sec. 5000E. Newly acquired single-family residences. 
‘‘Sec. 5000F. Excess single-family residences. 
‘‘Sec. 5000G. Definitions and other special rules. 
‘‘SEC. 5000E. NEWLY ACQUIRED SINGLE-FAMILY RESI-
DENCES. 
‘‘(a) IN GENERAL.—In the case of a hedge fund tax-
payer, there is hereby imposed a tax on the acquisition 
of any newly acquired single-family residence equal to the 
greater of— 
‘‘(1) 15 percent of the purchase price, or 
‘‘(2) $10,000 
‘‘(b) NEWLY
ACQUIRED
SINGLE-FAMILY
RESI-
DENCE.—For purposes of this section, the term ‘newly ac-
quired single-family residence’ means any single-family 
residence which was acquired by the taxpayer in any tax-
able year which begins after the date of the enactment 
of this chapter. 
‘‘(c) PURCHASE PRICE.—For purposes of this sec-
tion, the term ‘purchase price’ means the adjusted basis 
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of the newly acquired single-family residence on the date 
such residence is purchased. 
‘‘SEC. 5000F. EXCESS SINGLE-FAMILY RESIDENCES. 
‘‘(a) IN GENERAL.—In the case of an applicable tax-
payer who fails to meet the requirements of subsection (b), 
there is hereby imposed a tax equal to the product of— 
‘‘(1) $5,000, and 
‘‘(2) the excess of— 
‘‘(A) the number of applicable single-family 
residences owned by the taxpayer as of the last 
day of the taxable year, over 
‘‘(B) the maximum permissible units for 
the taxable year. 
‘‘(b) REQUIREMENT.— 
‘‘(1) IN
GENERAL.—An applicable taxpayer 
meets the requirement of this subsection for any tax-
able year if the number of applicable single-family 
residences owned by the taxpayer as of the last day 
of the taxable year is equal to or less than the max-
imum permissible units determined with respect to 
such taxpayer for such taxable year. 
‘‘(2) SPECIAL RULE FOR CERTAIN SALES.—For 
purposes of applying paragraph (1), a single-family 
residence which is sold or transferred in a disquali-
fied sale during the taxable year shall be treated as 
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‘‘(A) manages funds pooled from investors, 
and 
‘‘(B) is a fiduciary with respect to such in-
vestors. 
‘‘(2) APPLICABLE ENTITY.— 
‘‘(A) IN GENERAL.—The term ‘applicable 
entity’ means— 
‘‘(i) any partnership, 
‘‘(ii) any corporation, or 
‘‘(iii) any real estate investment trust. 
‘‘(B) EXCEPTIONS.—The term ‘applicable 
entity’ shall not include— 
‘‘(i) an organization which is de-
scribed in section 501(c)(3) and exempt 
from tax under section 501(a), or 
‘‘(ii) an organization which is pri-
marily engaged in the construction or reha-
bilitation of single-family residences and 
which offers such residences for sale in the 
ordinary course of business. 
‘‘(b) HEDGE FUND TAXPAYER.—For purposes of 
this section, the term ‘hedge fund taxpayer’ means, with 
respect to any taxable year, any applicable taxpayer which 
has $50,000,000 or more in net value or assets under 
management on any day during the taxable year. 
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‘‘(c) SINGLE-FAMILY RESIDENCE.—For purposes of 
this chapter— 
‘‘(1) IN
GENERAL.—The term ‘single-family 
residence’ means a residential property consisting of 
1-to-4 dwelling units. 
‘‘(2) EXCEPTIONS.—A residential property shall 
not be treated as a residential property described in 
clause (i) if— 
‘‘(A) such property is unoccupied and ac-
quired through foreclosure (other than such a 
residence acquired through foreclosure by a 
hedge fund taxpayer, as defined in section 
5000F((d)(3)), 
‘‘(B) such property is— 
‘‘(i) not rented or leased, and 
‘‘(ii) used as the principal residence 
(within the meaning of section 121) of any 
person who has an ownership interest in 
the applicable taxpayer, or 
‘‘(C) such property— 
‘‘(i) was a building with respect to 
which a credit was allowed under section 
42 (relating to the low-income housing 
credit), and 
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‘‘(ii) is not owned by a hedge fund 
taxpayer 
(as 
defined 
in 
section 
5000F(d)(3)). 
‘‘(d) ACQUISITION; OWNERSHIP.—For purposes of 
this chapter, an applicable taxpayer shall be treated— 
‘‘(1) as acquiring a single-family residence if 
the applicable taxpayer acquires a majority owner-
ship interest in the single-family residence, regard-
less of the percentage of that ownership interest, 
and 
‘‘(2) as owning a single-family residence if the 
applicable taxpayer owns a majority ownership inter-
est in the single-family residence, regardless of the 
percentage of that ownership interest. 
‘‘(e) AGGREGATION RULES.— 
‘‘(1) IN GENERAL.—For purposes of this chap-
ter, all persons which are treated as a single em-
ployer under subsections (a) and (b) of section 52 
shall be treated as a single person. 
‘‘(2) MODIFICATIONS.—For purposes of this 
subsection— 
‘‘(A) section 52(a) shall be applied by sub-
stituting ‘component members’ for ‘members’, 
and 
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‘‘(B) for purposes of applying section 
52(b), the term ‘trade or business’ shall include 
any activity treated as a trade or business 
under paragraph (5) or (6) of section 469(c) 
(determined without regard to the phrase ‘To 
the extent provided in regulations’ in such para-
graph (6)). 
‘‘(3) COMPONENT MEMBER.—For purposes of 
this paragraph, the term ‘component member’ has 
the meaning given such term by section 1563(b), ex-
cept that the determination shall be made without 
regard to section 1563(b)(2).’’. 
(b) CLERICAL AMENDMENT.—The table of chapters 
for subtitle D of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new item: 
‘‘CHAPTER 50B—EXCESS SINGLE-FAMILY RESIDENCES’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of enactment of this Act. 
SEC. 3. DISALLOWANCE OF MORTGAGE INTEREST AND DE-
PRECIATION IN CONNECTION WITH SINGLE 
FAMILY RESIDENCES OWNED BY COVERED 
TAXPAYERS. 
(a) MORTGAGE INTEREST.— 
(1) IN GENERAL.—Section 163 of the Internal 
Revenue Code of 1986 is amended by redesignating 
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subsection (n) as subsection (o) and by inserting 
after subsection (m) the following new subsection: 
‘‘(n) CERTAIN INTEREST PAID BY COVERED TAX-
PAYERS.— 
‘‘(1) IN GENERAL.—No deduction shall be al-
lowed under this chapter for a taxable year with re-
spect to interest paid or accrued on acquisition in-
debtedness with respect to any single-family resi-
dence if the owner of such single-family residence is 
liable for tax under chapter 50B for such taxable 
year. 
‘‘(2) DEFINITIONS.—For purposes of this sub-
section— 
‘‘(A) ACQUISITION
INDEBTEDNESS.—The 
term ‘acquisition indebtedness’ has the meaning 
given such term under subsection (h)(3)(B), de-
termined— 
‘‘(i) by substituting ‘single-family resi-
dence (as defined in section 5000G(b))’ for 
‘qualified residence’, and 
‘‘(ii) without regard to clause (ii) 
thereof. 
‘‘(B) SINGLE-FAMILY
RESIDENCE.—The 
term ‘single-family residence’ has the meaning 
given such term under section 5000G(b) 
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‘‘(C) OWNERSHIP.—The rules of section 
5000G(c) shall apply for purposes of deter-
mining ownership.’’. 
(2) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to taxable years begin-
ning after the date of the enactment of this Act. 
(b) DEPRECIATION.— 
(1) IN GENERAL.—Section 167 of the Internal 
Revenue Code of 1986 is amended by redesignating 
subsection (i) as subsection (j) and by inserting after 
subsection (h) the following new subsection: 
‘‘(i) DEDUCTION DISALLOWED FOR DISQUALIFIED 
SINGLE FAMILY PROPERTY OWNERS.— 
‘‘(1) IN GENERAL.—No deduction shall be al-
lowed under this section for a taxable year with re-
spect to a single-family residence if the owner of 
such single-family residence is liable for tax under 
chapter 50B for such taxable year. 
‘‘(2) DEFINITIONS.—For purposes of this sub-
section— 
‘‘(A) SINGLE-FAMILY
RESIDENCE.—The 
term ‘single-family residence’ has the meaning 
given such term under section 5000G(b). 
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‘‘(B) OWNERSHIP.—The rules of section 
5000G(c) shall apply for purposes of deter-
mining ownership.’’. 
(2) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to taxable years begin-
ning after the date of the enactment of this Act. 
Æ 
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