I 
108TH CONGRESS 
1ST SESSION H. R. 3610
To amend the Internal Revenue Code of 1986 to replace the recapture 
bond provisions of the low income housing tax credit program. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 21, 2003
Mr. HOUGHTON (for himself, Mrs. JOHNSON of Connecticut, Mr. RANGEL, 
and Mr. NEAL of Massachusetts) 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 replace 
the recapture bond provisions of the low income housing 
tax credit program.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. REPEAL OF RECAPTURE BOND RULE. 
(a) IN GENERAL.—Paragraph (6) of section 42(j) of 
the Internal Revenue Code of 1986 (relating to recapture 
of credit) is amended to read as follows: 
‘‘(6) NO
RECAPTURE
ON
DISPOSITION
OF 
BUILDING
(OR
INTEREST
THEREIN)
REASONABLY
EXPECTED TO CONTINUE AS A QUALIFIED LOW-IN-
COME BUILDING.—
‘‘(A) IN GENERAL.—In the case of a dis-
position of a building or an interest therein, the 
taxpayer shall be discharged from liability for 
any additional tax under this subsection by rea-
son of such disposition if it is reasonably ex-
pected that such building will continue to be op-
erated as a qualified low-income building for 
the remaining compliance period with respect to 
such building. 
‘‘(B) STATUTE OF LIMITATIONS.—
‘‘(i) EXTENSION OF PERIOD.—The pe-
riod for assessing a deficiency attributable 
to the application of subparagraph (A) 
with respect to a building (or interest 
therein) during the compliance period with 
respect to such building shall not expire 
before the expiration of 3 years after the 
end of such compliance period. 
‘‘(ii) ASSESSMENT.—Such deficiency 
may be assessed before the expiration of 
the 3-year period referred to in clause (i) 
notwithstanding the provisions of any
other law or rule of law which would other-
wise prevent such assessment.’’. 
(b) INFORMATION REPORTING.—
(1) IN GENERAL.—Subpart B of part III of 
subchapter A of chapter 61 of such Code (relating 
to information concerning transactions with other 
persons) is amended by inserting after section 
6050T the following new section: 
‘‘SEC. 6050U. RETURNS RELATING TO PAYMENT OF LOW-IN-
COME 
HOUSING 
CREDIT 
REPAYMENT 
AMOUNT. 
‘‘(a) REQUIREMENT OF REPORTING.—Every person 
who, at any time during the taxable year, is an owner of 
a building (or an interest therein)—
‘‘(1) which is in the compliance period at any 
time during such year, and 
‘‘(2) with respect to which recapture is required 
by section 42(j), 
shall, at such time as the Secretary may prescribe, make 
the return described in subsection (b). 
‘‘(b) FORM AND MANNER OF RETURNS.—A return 
is described in this subsection if such return—
‘‘(1) is in such form as the Secretary may pre-
scribe, and 
‘‘(2) contains—
‘‘(A) the name, address, and TIN of each 
person who, with respect to such building or in-
terest, was formerly an investor in such owner 
at any time during the compliance period, 
‘‘(B) the amount (if any) of any credit re-
capture amount required under section 42(j), 
and 
‘‘(C) such other information as the Sec-
retary may prescribe. 
‘‘(c) STATEMENTS TO BE FURNISHED TO PERSONS 
WITH RESPECT TO WHOM INFORMATION IS REQUIRED.—
Every person required to make a return under subsection 
(a) shall furnish to each person whose name is required 
to be set forth in such return a written statement show-
ing—
‘‘(1) the name and address of the person re-
quired to make such return and the phone number 
of the information contact for such person, and 
‘‘(2) the information required to be shown on 
the return with respect to such person. 
The written statement required under the preceding sen-
tence shall be furnished on or before March 31 of the year 
following the calendar year for which the return under 
subsection (a) is required to be made.
serting after the item relating to section 6050S 
the following new item:
‘‘Sec. 6050U. Returns relating to payment of low-income housing credit repay-
ment amount.’’.
(c) EFFECTIVE DATE.—
(1) IN GENERAL.—The amendments made by 
this section shall apply with respect to any liability 
for the credit recapture amount under section 42(j) 
of the Internal Revenue Code of 1986 that arises 
after the date of the enactment of this Act. 
(2) SPECIAL RULE FOR LOW-INCOME HOUSING 
BUILDINGS SOLD BEFORE DATE OF ENACTMENT OF 
THIS ACT.—In the case of a building disposed of be-
fore the date of the enactment of this Act with re-
spect to which the taxpayer posted a bond (or alter-
native form of security) under section 42(j) of the 
Internal Revenue Code of 1986 (as in effect before 
the enactment of this Act), the taxpayer may elect 
(by notifying the Secretary of the Treasury in writ-
ing)—
(A) to cease to be subject to the bond re-
quirements under section 42(j)(6) of such Code 
(as in effect before the enactment of this Act), 
and
(B) to be subject to the requirements of 
section 42(j) of such Code (as amended by this 
Act).
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