I 
110TH CONGRESS 
2D SESSION 
H. R. 5992 
To amend the Internal Revenue Code of 1986 to allow a refundable credit 
against income tax for the purchase of real property by a first-time purchaser. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 7, 2008 
Mr. SHULER 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 
refundable credit against income tax for the purchase 
of real property by a first-time purchaser. 
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 ‘‘First Time Property 
Owners Tax Credit Act of 2008’’. 
SEC. 2. REFUNDABLE CREDIT FOR FIRST-TIME PURCHASE 
OF REAL PROPERTY. 
(a) IN GENERAL.—Subpart C of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to refundable credits) is amended by redes-
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ignating section 36 as section 37 and by inserting after 
section 35 the following new section: 
‘‘SEC. 36. FIRST-TIME PURCHASE OF REAL PROPERTY. 
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in-
dividual who is a first-time purchaser of real property in 
the United States during any taxable year, there shall be 
allowed as a credit against the tax imposed by this subtitle 
for the taxable year an amount equal to 5 percent of the 
purchase price of such property. 
‘‘(b) LIMITATIONS.— 
‘‘(1) MAXIMUM DOLLAR AMOUNT.— 
‘‘(A) IN
GENERAL.—The credit allowed 
under subsection (a) shall not exceed the excess 
(if any) of $1,500 (2 times such amount in the 
case of a joint return). 
‘‘(B) INFLATION
ADJUSTMENT.—In the 
case of any taxable year beginning after Decem-
ber 31, 2008, the $1,500 amount under sub-
paragraph (A) shall be increased by an amount 
equal to $1,500, multiplied by the cost-of-living 
adjustment determined under section 1(f)(3) for 
the calendar year in which the taxable year be-
gins by substituting ‘2007’ for ‘1992’ in sub-
paragraph (B) thereof. If the $1,500 amount as 
adjusted under the preceding sentence is not a 
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multiple of $10, such amount shall be rounded 
to the nearest multiple of $10. 
‘‘(2) TAXABLE INCOME LIMITATION.— 
‘‘(A) IN GENERAL.—If the taxable income 
of the taxpayer for any taxable year exceeds the 
maximum taxable income in the table under 
subsection (a), (b), (c), or (d) of section 1, 
whichever is applicable, to which the 25 percent 
rate applies, the dollar amounts in effect under 
paragraph (1)(A) for such taxpayer for the fol-
lowing taxable year shall be reduced (but not 
below zero) by the amount of the excess. 
‘‘(B) CHANGE IN RETURN STATUS.—In the 
case of married individuals filing a joint return 
for any taxable year who did not file such a 
joint return for the preceding taxable year, sub-
paragraph (A) shall be applied by reference to 
the highest taxable income of either such indi-
vidual for the preceding taxable year. 
‘‘(c) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
‘‘(1) FIRST-TIME PURCHASER.— 
‘‘(A) IN GENERAL.—The term ‘first-time 
purchaser’ means any individual if such indi-
vidual (and if married, such individual’s spouse) 
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had no present ownership interest in real prop-
erty during the 2-year period ending on the 
date of acquisition of the property to which sub-
section (a) applies. 
‘‘(B) ONE-TIME ONLY.—If an individual is 
treated as a first-time purchaser with respect to 
any real property, such individual may not be 
treated as a first-time purchaser with respect to 
any other real property. 
‘‘(C) 
MARRIED
INDIVIDUALS
FILING 
JOINTLY.—In the case of married individuals 
who file a joint return, the credit under this 
section is allowable only if both individuals are 
first-time purchasers. 
‘‘(D) OTHER TAXPAYERS.—If 2 or more 
individuals who are not married purchase real 
property— 
‘‘(i) the credit under this section is al-
lowable only if each of the individuals is a 
first-time purchaser, and 
‘‘(ii) the amount of the credit allowed 
under subsection (a) shall be allocated 
among such individuals in such manner as 
the Secretary may prescribe, except that 
the total amount of the credits allowed to 
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all such individuals shall not exceed the 
amount 
in 
effect 
under 
subsection 
(b)(1)(A) for individuals filing joint re-
turns. 
‘‘(2) PURCHASE.—The term ‘purchase’ means 
any acquisition, but only if— 
‘‘(A) the property is not acquired from a 
person whose relationship to the person acquir-
ing it would result in the disallowance of losses 
under section 267 or 707(b) (but, in applying 
section 267 (b) and (c) for purposes of this sec-
tion, paragraph (4) of section 267(c) shall be 
treated as providing that the family of an indi-
vidual shall include only the individual’s spouse, 
ancestors, and lineal descendants), and 
‘‘(B) the basis of the property in the hands 
of the person acquiring it is not determined— 
‘‘(i) in whole or in part by reference 
to the adjusted basis of such property in 
the hands of the person from whom ac-
quired, or 
‘‘(ii) under section 1014(a) (relating 
to property acquired from a decedent). 
‘‘(3) PURCHASE
PRICE.—The term ‘purchase 
price’ means the adjusted basis of the property on 
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the date on which a binding contract to acquire such 
property is entered into. 
‘‘(d) DENIAL OF DOUBLE BENEFIT.—No credit shall 
be allowed under subsection (a) for any expense for which 
a deduction or credit is allowed under any other provision 
of this chapter. 
‘‘(e) BASIS ADJUSTMENT.—For purposes of this sub-
title, if a credit is allowed under this section with respect 
to the purchase of any property, the basis of such property 
shall be reduced by the amount of the credit so allowed. 
‘‘(f) PROPERTY TO WHICH SECTION APPLIES.—The 
provisions of this section apply to real property if— 
‘‘(1) the taxpayer purchases such property on 
or after January 1, 2008, and before January 1, 
2013, or 
‘‘(2) the taxpayer enters into, on or after Janu-
ary 1, 2008, and before January 1, 2013, a binding 
contract to purchase such property before July 1, 
2014.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Subsection (a) of section 1016 of the Inter-
nal Revenue Code of 1986 (relating to general rule 
for adjustments to basis) is amended by striking 
‘‘and’’ at the end of paragraph (35), by striking the 
period at the end of paragraph (36) and inserting ‘‘, 
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and’’, and by adding at the end the following new 
paragraph: 
‘‘(37) in the case of real property with respect 
to which a credit was allowed under section 36, to 
the extent provided in section 36(e).’’. 
(2) Section 1324(b)(2) of title 31, United 
States Code, is amended by inserting ‘‘or 36’’ after 
‘‘section 35’’. 
(c) CLERICAL AMENDMENT.—The table of sections 
for subpart C of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by strik-
ing the item relating to section 36 and inserting the fol-
lowing new items: 
‘‘Sec. 36. First-time purchase of real property. 
‘‘Sec. 37. Overpayments of tax.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2007. 
Æ 
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