I 
115TH CONGRESS 
1ST SESSION H. R. 1661 
To amend the Internal Revenue Code of 1986 to reform the low-income 
housing credit, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 21, 2017 
Mr. TIBERI (for himself, Mr. NEAL, Mr. MEEHAN, Mr. BLUMENAUER, Mr. 
KELLY of Pennsylvania, Ms. SA´NCHEZ, Mr. PAULSEN, Mr. CROWLEY, 
Mr. REICHERT, Mr. THOMPSON of California, Mr. SMITH of Missouri, 
Mr. DANNY K. DAVIS of Illinois, Mr. CURBELO of Florida, Mr. MEEKS, 
Mr. FASO, Mr. KATKO, Mr. PASCRELL, and Mr. RENACCI) 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 reform 
the low-income housing credit, 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; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Affordable Housing Credit Improvement Act of 2017’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title; table of contents. 
TITLE I—REFORMS RELATING TO TENANT ELIGIBILITY 
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Sec. 101. Average income test. 
Sec. 102. Uniform income eligibility for rural projects. 
Sec. 103. Codification of rules relating to increased tenant income. 
Sec. 104. Modification of student occupancy rules. 
Sec. 105. Tenant voucher payments taken into account as rent for certain pur-
poses. 
TITLE II—CREDIT RATE AND OTHER RULES RELATING TO 
CREDIT ELIGIBILITY AND DETERMINATION 
Sec. 201. Minimum credit rate. 
Sec. 202. Reconstruction or replacement period after casualty loss. 
Sec. 203. Modification of rights relating to building purchase. 
Sec. 204. Modification of 10-year rule; limitation on acquisition basis. 
Sec. 205. Certain relocation costs taken into account as rehabilitation expendi-
tures. 
Sec. 206. Repeal of qualified census tract population cap. 
Sec. 207. Determination of community revitalization plan to be made by hous-
ing credit agency. 
Sec. 208. Prohibition of local approval and contribution requirements. 
Sec. 209. Increase in credit for certain projects designated to serve extremely 
low-income households. 
Sec. 210. Increase in credit for bond-financed projects designated by State 
agency. 
Sec. 211. Elimination of basis reduction for low-income housing properties re-
ceiving energy credit benefits. 
Sec. 212. Restriction of planned foreclosures. 
Sec. 213. Increase of population cap for difficult development areas. 
TITLE III—REFORMS RELATING TO NATIVE AMERICAN 
ASSISTANCE 
Sec. 301. Selection criteria under qualified allocation plans. 
Sec. 302. Inclusion of Indian areas as difficult development areas for purposes 
of certain buildings. 
TITLE IV—AFFORDABLE HOUSING TAX CREDIT 
Sec. 401. Affordable housing tax credit. 
TITLE I—REFORMS RELATING 
TO TENANT ELIGIBILITY 
SEC. 101. AVERAGE INCOME TEST. 
(a) IN GENERAL.—Paragraph (1) of section 42(g) of 
the Internal Revenue Code of 1986 is amended— 
(1) by striking ‘‘subparagraph (A) or (B)’’ and 
inserting ‘‘subparagraph (A), (B), or (C)’’, and 
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(2) by inserting after subparagraph (B) the fol-
lowing new subparagraph: 
‘‘(C) AVERAGE INCOME TEST.— 
‘‘(i) IN GENERAL.—The project meets 
the minimum requirements of this sub-
paragraph if 40 percent or more (25 per-
cent or more in the case of a project de-
scribed in section 142(d)(6)) of the resi-
dential units in such project are both rent- 
restricted and occupied by individuals 
whose income does not exceed the imputed 
income limitation designated by the tax-
payer with respect to the respective unit. 
‘‘(ii) SPECIAL
RULES
RELATING
TO 
INCOME
LIMITATION.—For purposes of 
clause (i)— 
‘‘(I) 
DESIGNATION.—The 
tax-
payer shall designate the imputed in-
come limitation of each unit taken 
into account under such clause. 
‘‘(II) AVERAGE TEST.—The aver-
age of the imputed income limitations 
designated under subclause (I) shall 
not exceed 60 percent of area median 
gross income. 
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‘‘(III) 
10-PERCENT
INCRE-
MENTS.—The designated imputed in-
come limitation of any unit under sub-
clause (I) shall be 20 percent, 30 per-
cent, 40 percent, 50 percent, 60 per-
cent, 70 percent, or 80 percent of 
area median gross income.’’. 
(b) RULES RELATING TO NEXT AVAILABLE UNIT.— 
Subparagraph (D) of section 42(g)(2) of the Internal Rev-
enue Code of 1986 is amended— 
(1) in clause (i), by striking ‘‘clause (ii)’’ and 
inserting ‘‘clauses (ii), (iii), and (iv)’’, 
(2) in clause (ii)— 
(A) by striking ‘‘If’’ and inserting ‘‘In the 
case of a project with respect to which the tax-
payer elects the requirements of subparagraph 
(A) or (B) of paragraph (1), if’’, 
(B) by striking the second sentence, and 
(C) by striking ‘‘NEXT AVAILABLE UNIT 
MUST BE RENTED TO LOW-INCOME TENANT IF 
INCOME RISES ABOVE 140 PERCENT OF INCOME 
LIMIT’’ in the heading and inserting ‘‘RENTAL 
OF NEXT AVAILABLE UNIT IN CASE OF 20–50 OR 
40–60 TEST’’, and 
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(3) by adding at the end the following new 
clauses: 
‘‘(iii) RENTAL
OF
NEXT
AVAILABLE 
UNIT
IN
CASE
OF
AVERAGE
INCOME 
TEST.—In the case of a project with re-
spect to which the taxpayer elects the re-
quirements of subparagraph (C) of para-
graph (1), if the income of the occupants 
of the unit increases above 140 percent of 
the greater of— 
‘‘(I) 60 percent of area median 
gross income, or 
‘‘(II) the imputed income limita-
tion designated with respect to the 
unit under paragraph (1)(C)(ii)(I), 
clause (i) shall cease to apply to any such 
unit if any residential rental unit in the 
building (of a size comparable to, or small-
er than, such unit) is occupied by a new 
resident whose income exceeds the limita-
tion described in clause (v). 
‘‘(iv) 
DEEP
RENT
SKEWED 
PROJECTS.—In the case of a project de-
scribed in section 142(d)(4)(B), clause (ii) 
or (iii), whichever is applicable, shall be 
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applied by substituting ‘170 percent’ for 
‘140 percent’, and— 
‘‘(I) in the case of clause (ii), by 
substituting ‘any low-income unit in 
the building is occupied by a new resi-
dent whose income exceeds 40 percent 
of area median gross income’ for ‘any 
residential rental unit’ and all that 
follows in such clause, and 
‘‘(II) in the case of clause (iii), 
by substituting ‘any low-income unit 
in the building is occupied by a new 
resident whose income exceeds the 
lesser of 40 percent of area median 
gross income or the imputed income 
limitation designated with respect to 
such 
unit 
under 
paragraph 
(1)(C)(ii)(I)’ for ‘any residential rent-
al unit’ and all that follows in such 
clause. 
‘‘(v) LIMITATION
DESCRIBED.—For 
purposes of clause (iii), the limitation de-
scribed in this clause with respect to any 
unit is— 
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‘‘(I) the imputed income limita-
tion designated with respect to such 
unit under paragraph (1)(C)(ii)(I), in 
the case of a unit which was taken 
into account as a low-income unit 
prior to becoming vacant, and 
‘‘(II) the imputed income limita-
tion which would have to be des-
ignated with respect to such unit 
under such paragraph in order for the 
project to continue to meet the re-
quirements 
of 
paragraph 
(1)(C)(ii)(II), in the case of any other 
unit.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to elections made under section 
42(g)(1) of the Internal Revenue Code of 1986 after the 
date of the enactment of this Act. 
SEC. 102. UNIFORM INCOME ELIGIBILITY FOR RURAL 
PROJECTS. 
(a) IN GENERAL.—Paragraph (8) of section 42(i) of 
the Internal Revenue Code of 1986 is amended by striking 
the second sentence. 
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(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2017. 
SEC. 103. CODIFICATION OF RULES RELATING TO IN-
CREASED TENANT INCOME. 
(a) IN GENERAL.—Clause (i) of section 42(g)(2)(D) 
of the Internal Revenue Code of 1986, as amended by this 
Act, is amended by striking ‘‘clauses (ii), (iii), and (iv)’’ 
and all that follows and inserting ‘‘clauses (ii), (iii), (iv), 
and (vi), notwithstanding an increase in the income of the 
occupants above the income limitation applicable under 
paragraph (1)— 
‘‘(I) a low-income unit shall con-
tinue to be treated as a low-income 
unit if the income of such occupants 
initially was 60 percent or less of area 
median gross income and such unit 
continues to be rent-restricted, and 
‘‘(II) a unit to which, at the time 
of initial occupancy by such occu-
pants, any Federal, State, or local 
government income restriction ap-
plied, and which subsequently becomes 
part of a building with respect to 
which rehabilitation expenditures are 
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taken into account under subsection 
(e), shall be treated as a low-income 
unit if the income of such occupants 
initially was 60 percent or less of area 
median gross income and does not ex-
ceed 120 percent of area median gross 
income as of the date of acquisition of 
the property by the taxpayer.’’. 
(b) EXCEPTION.—Subparagraph (D) of section 
42(g)(2) of the Internal Revenue Code of 1986, as amend-
ed by this Act, is amended by adding at the end the fol-
lowing new clause: 
‘‘(vi) EXCEPTION TO RULE RELATING 
TO INCREASED TENANT INCOME.—In the 
case of an occupant of a low-income unit 
who initially qualified to occupy such unit 
by reason of paragraph (1)(C) with an in-
come in excess of 60 percent of area me-
dian gross income but not in excess of 80 
percent of area median gross income, 
clause (i) shall be applied for substituting 
‘80 percent’ for ‘60 percent’ each place it 
appears.’’. 
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(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2016. 
SEC. 104. MODIFICATION OF STUDENT OCCUPANCY RULES. 
(a) IN GENERAL.—Subparagraph (D) of section 
42(i)(3) of the Internal Revenue Code of 1986 is amended 
to read as follows: 
‘‘(D) RULES RELATING TO STUDENTS.— 
‘‘(i) IN
GENERAL.—A unit occupied 
solely by individuals who— 
‘‘(I) have not attained age 24, 
and 
‘‘(II) are enrolled in a full-time 
course of study at an institution of 
higher education (as defined in section 
3304(f)), 
shall not be treated as a low-income unit. 
‘‘(ii) EXCEPTION FOR CERTAIN FED-
ERAL PROGRAMS.—In the case of a feder-
ally assisted building (as defined in sub-
section (d)(6)(C)(i)), clause (i) shall not 
apply to a unit the occupants of which 
meet all requirements applicable under the 
housing program described in subsection 
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(d)(6)(C)(i) through which the building is 
assisted, financed, or operated. 
‘‘(iii) OTHER
EXCEPTIONS.—Clause 
(i) shall not apply to a unit occupied by an 
individual who— 
‘‘(I) is married, 
‘‘(II) is a person with disabilities 
(as defined in section 3(b)(3)(E) of 
the United States Housing Act of 
1937), 
‘‘(III) is a veteran (as defined in 
section 101(2) of title 38, United 
States Code), 
‘‘(IV) has one or more qualifying 
children 
(as 
defined 
in 
section 
152(c)), or 
‘‘(V) meets the income limitation 
applicable under subsection (g)(1) to 
the project of which the building is a 
part and is, or was immediately prior 
to attaining the age of majority— 
‘‘(aa) an emancipated minor 
or in legal guardianship as deter-
mined by a court of competent 
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jurisdiction in the individual’s 
State of legal residence, 
‘‘(bb) under the care and 
placement responsibility of the 
State agency responsible for ad-
ministering a plan under part B 
or part E of title IV of the Social 
Security Act, or 
‘‘(cc) was an unaccompanied 
youth (within the meaning of sec-
tion 725(6) of the McKinney- 
Vento Homeless Assistance Act 
(42 U.S.C. 11434a(6))) or a 
homeless child or youth (within 
the meaning of section 725(2) of 
such 
Act 
(42 
U.S.C. 
11434a(2))).’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2017. 
SEC. 105. TENANT VOUCHER PAYMENTS TAKEN INTO AC-
COUNT AS RENT FOR CERTAIN PURPOSES. 
(a) IN GENERAL.—Subparagraph (B) of section 
42(g)(2) of the Internal Revenue Code of 1986 is amended 
by adding at the end the following new sentence: ‘‘In the 
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case of a project with respect to which the taxpayer elects 
the requirements of subparagraph (C) of paragraph (1), 
or the portion of a project to which subsection (d)(5)(C) 
applies, clause (i) shall not apply with respect to any ten-
ant-based assistance (as defined in section 8(f)(7) of the 
United States Housing Act of 1937 (42 U.S.C. 
1437f(f)(7))).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to rent paid in taxable years begin-
ning after December 31, 2017. 
TITLE 
II—CREDIT 
RATE 
AND 
OTHER RULES RELATING TO 
CREDIT ELIGIBILITY AND DE-
TERMINATION 
SEC. 201. MINIMUM CREDIT RATE. 
(a) IN GENERAL.—Subsection (b) of section 42 of the 
Internal Revenue Code of 1986 is amended— 
(1) by redesignating paragraph (3) as para-
graph (4), and 
(2) by inserting after paragraph (2) the fol-
lowing new paragraph: 
‘‘(3) MINIMUM CREDIT RATE.—In the case of 
any new or existing building to which paragraph (2) 
does not apply and which is placed in service by the 
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taxpayer after December 31, 2016, the applicable 
percentage shall not be less than 4 percent.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to buildings placed in service after 
December 31, 2016. 
SEC. 202. RECONSTRUCTION OR REPLACEMENT PERIOD 
AFTER CASUALTY LOSS. 
(a) IN GENERAL.—Subparagraph (E) of section 
42(j)(4) of the Internal Revenue Code of 1986 is amended 
by striking ‘‘a reasonable period established by the Sec-
retary’’ and inserting ‘‘a reasonable period established by 
the applicable housing credit agency (not to exceed 25 
months from the date on which the casualty loss arises). 
The determination under paragraph (1) shall not be made 
with respect to a property the basis of which is affected 
by a casualty loss until the period described in the pre-
ceding sentence with respect to such property has ex-
pired.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to casualty losses arising after the 
date of the enactment of this Act. 
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SEC. 203. MODIFICATION OF RIGHTS RELATING TO BUILD-
ING PURCHASE. 
(a) IN GENERAL.—Subparagraph (A) of section 
42(i)(7) of the Internal Revenue Code of 1986 is amend-
ed— 
(1) by striking ‘‘a right of 1st refusal’’ and in-
serting ‘‘an option’’, and 
(2) by striking ‘‘the property’’ and inserting 
‘‘the property or a partnership interest relating to 
the property’’. 
(b) CONFORMING AMENDMENT.—Subparagraph (B) 
of section 42(i)(7) of the Internal Revenue Code of 1986 
is amended by adding at the end the following new sen-
tence: ‘‘In the case of a purchase of a partnership interest, 
the minimum purchase price is an amount equal to such 
interest’s ratable share of the amount determined under 
the first sentence of this subparagraph.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to agreements entered into or 
amended after the date of the enactment of this Act. 
SEC. 204. MODIFICATION OF 10-YEAR RULE; LIMITATION ON 
ACQUISITION BASIS. 
(a) IN GENERAL.—Clause (ii) of section 42(d)(2)(B) 
of the Internal Revenue Code of 1986 is amended by in-
serting ‘‘, or the taxpayer elects the application of sub-
paragraph (C)(ii)’’ after ‘‘service’’. 
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(b) LIMITATION ON ACQUISITION BASIS.—Subpara-
graph (C) of section 42(d)(2) of the Internal Revenue 
Code of 1986 is amended— 
(1) by striking ‘‘For purposes of subparagraph 
(A), the adjusted basis’’ and inserting ‘‘For pur-
poses of subparagraph (A)— 
‘‘(i) 
IN
GENERAL.—The 
adjusted 
basis’’, and 
(2) by adding at the end the following new 
clauses: 
‘‘(ii) BUILDINGS IN SERVICE WITHIN 
PREVIOUS
YEARS.—If the period be-
tween the date of acquisition of the build-
ing by the taxpayer and the date the build-
ing was last placed in service is less than 
10 years, the taxpayer’s basis attributable 
to the acquisition of the building which is 
taken into account in determining the ad-
justed basis shall not exceed the sum of— 
‘‘(I) the lowest amount paid for 
acquisition of the building by any per-
son during the 10 years preceding the 
date of the acquisition of the building 
by the taxpayer, adjusted as provided 
in clause (iii), and 
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‘‘(II) the value of any capital im-
provements made by the person who 
sells the building to the taxpayer 
which are reflected in such seller’s 
basis. 
‘‘(iii) ADJUSTMENT.—With respect to 
a basis determination made in any taxable 
year, the amount described in clause (ii)(I) 
shall be increased by an amount equal to— 
‘‘(I) such amount, multiplied by 
‘‘(II) a cost-of-living adjustment, 
determined in the same manner as 
under section 1(f)(3) for the calendar 
year in which the taxable year begins 
by taking into account the acquisition 
year in lieu of calendar year 1992. 
For purposes of the preceding sentence, 
the acquisition year is the calendar year in 
which the lowest amount referenced in 
clause (ii)(I) was paid for the acquisition 
of the building.’’. 
(c) CONFORMING AMENDMENTS.—Clause (i) of sec-
tion 42(d)(2)(D) of the Internal Revenue Code of 1986 
is amended— 
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(1) by striking ‘‘FOR SUBPARAGRAPH (B)’’ in 
the heading, and 
(2) by striking ‘‘subparagraph (B)(ii)’’ in the 
matter preceding subclause (I) and inserting ‘‘sub-
paragraph (B)(ii) or (C)(ii)’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to buildings placed in service after 
December 31, 2016. 
SEC. 205. CERTAIN RELOCATION COSTS TAKEN INTO AC-
COUNT AS REHABILITATION EXPENDITURES. 
(a) IN GENERAL.—Paragraph (2) of section 42(e) of 
the Internal Revenue Code of 1986 is amended by adding 
at the end the following new subparagraph: 
‘‘(C) CERTAIN
RELOCATION
COSTS.—In 
the case of a rehabilitation of a building to 
which section 280B does not apply, costs relat-
ing to the relocation of occupants, including— 
‘‘(i) amounts paid to occupants, 
‘‘(ii) amounts paid to third parties for 
services relating to such relocation, and 
‘‘(iii) amounts paid for temporary 
housing for occupants, 
shall be treated as chargeable to capital account 
and taken into account as rehabilitation ex-
penditures.’’. 
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SEC. 207. DETERMINATION OF COMMUNITY REVITALIZA-
TION PLAN TO BE MADE BY HOUSING CREDIT 
AGENCY. 
(a) IN
GENERAL.—Subclause (III) of section 
42(m)(1)(B)(ii) of the Internal Revenue Code of 1986 is 
amended by inserting ‘‘, as determined by the housing 
credit agency according to criteria established by such 
agency,’’ after ‘‘(d)(5)(C)) and’’. 
(b) CRITERIA.—Paragraph (1) of section 42(m) of 
the Internal Revenue Code of 1986 is amended by adding 
at the end the following new subparagraph: 
‘‘(E) CRITERIA FOR DETERMINATION RE-
LATING TO CONCERTED COMMUNITY REVITAL-
IZATION PLAN.—For purposes of subparagraph 
(B)(ii)(III), the criteria which shall be estab-
lished by a housing credit agency for deter-
mining whether the development of a project 
contributes to a concerted community develop-
ment plan shall take into account any factors 
the agency deems appropriate, including the ex-
tent to which the proposed plan— 
‘‘(i) is geographically specific, 
‘‘(ii) outlines a clear plan for imple-
mentation and goals for outcomes, 
‘‘(iii) includes a strategy for applying 
for or obtaining commitments of public or 
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private investment (or both) in nonhousing 
infrastructure, amenities, or services, and 
‘‘(iv) demonstrates the need for com-
munity revitalization.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to allocations of housing credit dol-
lar amounts made under qualified allocation plans (as de-
fined in section 42(m)(1)(B) of the Internal Revenue Code 
of 1986) adopted after December 31, 2017. 
SEC. 208. PROHIBITION OF LOCAL APPROVAL AND CON-
TRIBUTION REQUIREMENTS. 
(a) IN GENERAL.—Paragraph (1) of section 42(m) 
of the Internal Revenue Code of 1986, as amended by sec-
tion 207, is further amended— 
(1) by striking clause (ii) of subparagraph (A) 
and by redesignating clauses (iii) and (iv) thereof as 
clauses (ii) and (iii), and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(F) LOCAL APPROVAL OR CONTRIBUTION 
NOT TAKEN INTO ACCOUNT.—The selection cri-
teria under a qualified allocation plan shall not 
include consideration of— 
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‘‘(i) any support or opposition with re-
spect to the project from local or elected 
officials, or 
‘‘(ii) any local government contribu-
tion to the project, except to the extent 
such contribution is taken into account as 
part of a broader consideration of the 
project’s ability to leverage outside funding 
sources, and is not prioritized over any 
other source of outside funding.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to allocations of housing credit dol-
lar amounts made after December 31, 2017. 
SEC. 209. INCREASE IN CREDIT FOR CERTAIN PROJECTS 
DESIGNATED TO SERVE EXTREMELY LOW-IN-
COME HOUSEHOLDS. 
(a) IN GENERAL.—Paragraph (5) of section 42(d) of 
the Internal Revenue Code of 1986 is amended by adding 
at the end the following new subparagraph: 
‘‘(C) INCREASE IN CREDIT FOR PROJECTS 
DESIGNATED
TO
SERVE
EXTREMELY
LOW-IN-
COME HOUSEHOLDS.—In the case of any build-
ing— 
‘‘(i) 20 percent or more of the resi-
dential units in which are designated by 
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the taxpayer for occupancy by households 
the aggregate household income of which 
does not exceed the greater of— 
‘‘(I) 30 percent of area median 
gross income, or 
‘‘(II) 100 percent of an amount 
equal to the Federal poverty line 
(within 
the 
meaning 
of 
section 
36B(d)(3)), and 
‘‘(ii) which is designated by the hous-
ing credit agency as requiring the increase 
in credit under this subparagraph in order 
for such building to be financially feasible 
as part of a qualified low-income housing 
project, 
subparagraph (B) shall not apply to the portion 
of such building which is comprised of such 
units, and the eligible basis of such portion of 
the building shall be 150 percent of such basis 
determined without regard to this subpara-
graph.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to buildings placed in service after 
December 31, 2016. 
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SEC. 210. INCREASE IN CREDIT FOR BOND-FINANCED 
PROJECTS DESIGNATED BY STATE AGENCY. 
(a) IN GENERAL.—Clause (v) of section 42(d)(5)(B) 
of the Internal Revenue Code of 1986 is amended by strik-
ing the second sentence. 
(b) TECHNICAL AMENDMENT.—Clause (v) of section 
42(d)(5)(B) of the Internal Revenue Code of 1986, as 
amended by subsection (a), is further amended— 
(1) by striking ‘‘STATE’’ in the heading, and 
(2) by striking ‘‘State housing credit agency’’ 
and inserting ‘‘housing credit agency’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to buildings placed in service after 
December 31, 2016. 
SEC. 211. ELIMINATION OF BASIS REDUCTION FOR LOW-IN-
COME HOUSING PROPERTIES RECEIVING EN-
ERGY CREDIT BENEFITS. 
(a) IN GENERAL.—Paragraph (3) of section 50(c) of 
the Internal Revenue Code of 1986 is amended— 
(1) by striking ‘‘and’’ at the end of subpara-
graph (A), 
(2) by striking the period at the end of sub-
paragraph (B) and inserting ‘‘, and’’, and 
(3) by adding at the end the following new sub-
paragraph: 
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‘‘(C) paragraph (1) shall not apply to any 
property with respect to which a credit is al-
lowed under section 42.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to property placed in service after 
December 31, 2016. 
SEC. 212. RESTRICTION OF PLANNED FORECLOSURES. 
(a) 
IN
GENERAL.—Subclause 
(I) 
of 
section 
42(h)(6)(E)(i) of the Internal Revenue Code of 1986 is 
amended to read as follows: 
‘‘(I) on the 61st day after the 
taxpayer (or a successor in interest) 
provides notice to the housing credit 
agency that the building has been ac-
quired by foreclosure (or instrument 
in lieu of foreclosure) and that the 
taxpayer intends the termination of 
such period, unless the housing credit 
agency determines that such acquisi-
tion is part of an arrangement with 
the taxpayer a purpose of which is to 
terminate such period, or’’. 
(b) CONFORMING AMENDMENT.—The second sen-
tence of clause (i) of section 42(h)(6)(E) of the Internal 
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Revenue Code of 1986 is amended by striking ‘‘Subclause 
(II)’’ and inserting ‘‘Subclauses (I) and (II)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to acquisitions by foreclosure (or 
instrument in lieu of foreclosure) after December 31, 
2017. 
SEC. 213. INCREASE OF POPULATION CAP FOR DIFFICULT 
DEVELOPMENT AREAS. 
(a) 
IN
GENERAL.—Subclause 
(II) 
of 
section 
42(d)(5)(B)(iii) of the Internal Revenue Code of 1986 is 
amended by striking ‘‘20 percent’’ and inserting ‘‘30 per-
cent’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to designations made under section 
42(d)(5)(B)(iii) of the Internal Revenue Code of 1986 
after December 31, 2017. 
TITLE III—REFORMS RELATING 
TO 
NATIVE 
AMERICAN 
AS-
SISTANCE 
SEC. 301. SELECTION CRITERIA UNDER QUALIFIED ALLO-
CATION PLANS. 
(a) IN GENERAL.—Subparagraph (C) of section 
42(m)(1) of the Internal Revenue Code of 1986 is amend-
ed by striking ‘‘and’’ at the end of clause (ix), by striking 
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the period at the end of clause (x) and inserting ‘‘, and’’, 
and by adding at the end the following new clause: 
‘‘(xi) the affordable housing needs of 
individuals in the State who are members 
of Indian tribes (as defined in section 
45A(c)(6)).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to allocations of credits under sec-
tion 42 of the Internal Revenue Code of 1986 made after 
December 31, 2017. 
SEC. 302. INCLUSION OF INDIAN AREAS AS DIFFICULT DE-
VELOPMENT AREAS FOR PURPOSES OF CER-
TAIN BUILDINGS. 
(a) 
IN
GENERAL.—Subclause 
(I) 
of 
section 
42(d)(5)(B)(iii) of the Internal Revenue Code of 1986 is 
amended by inserting before the period the following: ‘‘, 
and any Indian area’’. 
(b) 
INDIAN
AREA.—Clause 
(iii) 
of 
section 
42(d)(5)(B) of the Internal Revenue Code of 1986 is 
amended by redesignating subclause (II) as subclause 
(III) and by inserting after subclause (I) the following new 
subclause: 
‘‘(II) INDIAN
AREA.—For pur-
poses of subclause (I), the term ‘In-
dian area’ means any Indian area (as 
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defined in section 4(11) of the Native 
American Housing Assistance and 
Self Determination Act of 1996 (25 
U.S.C. 4103(11)).’’. 
(c) ELIGIBLE BUILDINGS.—Clause (iii) of section 
42(d)(5)(B) of the Internal Revenue Code of 1986, as 
amended by subsection (b), is amended by adding at the 
end the following new subclause: 
‘‘(IV) SPECIAL RULE FOR BUILD-
INGS IN INDIAN AREAS.—In the case 
of an area which is a difficult develop-
ment area solely because it is an In-
dian area, a building shall not be 
treated as located in such area unless 
such building is assisted or financed 
under the Native American Housing 
Assistance and Self Determination 
Act of 1996 (25 U.S.C. 4101 et seq.) 
or the project sponsor is an Indian 
tribe 
(as 
defined 
in 
section 
45A(c)(6)), a tribally designated hous-
ing entity (as defined in section 4(22) 
of such Act (25 U.S.C. 4103(22))), or 
wholly owned or controlled by such an 
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Indian tribe or tribally designated 
housing entity.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to buildings placed in service after 
December 31, 2017. 
TITLE IV—AFFORDABLE 
HOUSING TAX CREDIT 
SEC. 401. AFFORDABLE HOUSING TAX CREDIT. 
(a) IN GENERAL.—The heading of section 42 of the 
Internal Revenue Code of 1986 is amended by striking 
‘‘LOW-INCOME’’ and inserting ‘‘AFFORDABLE’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Subsection (a) of section 42 of the Internal 
Revenue Code of 1986 is amended by striking ‘‘low- 
income’’ and inserting ‘‘affordable’’. 
(2) Paragraph (5) of section 38(b) of such Code 
is amended by striking ‘‘low-income’’ and inserting 
‘‘affordable’’. 
(3) The heading of subparagraph (D) of section 
469(i)(3) of such Code is amended by striking 
‘‘LOW-INCOME’’ and inserting ‘‘AFFORDABLE’’. 
(4) The heading of subparagraph (B) of section 
469(i)(6) of such Code is amended by striking 
‘‘LOW-INCOME’’ and inserting ‘‘AFFORDABLE’’. 
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(5) Paragraph (7) of section 772(a) of such 
Code is amended by striking ‘‘low-income’’ and in-
serting ‘‘affordable’’. 
(6) Paragraph (5) of section 772(d) of such 
Code is amended by striking ‘‘low-income’’ and in-
serting ‘‘affordable’’. 
(c) CLERICAL AMENDMENT.—The item relating to 
section 42 in the table of sections for subpart D of part 
IV of subchapter A of chapter 1 of the Internal Revenue 
Code of 1986 is amended to read as follows: 
‘‘Sec. 42. Affordable housing credit.’’. 
Æ 
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