I 
108TH CONGRESS 
2D SESSION 
H. R. 3875
To amend the Internal Revenue Code of 1986 to provide that qualified 
homeowner downpayment assistance is a charitable purpose. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 2, 2004
Mr. COLLINS (for himself and Mr. BECERRA) 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 provide 
that qualified homeowner downpayment assistance is a 
charitable purpose.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. QUALIFIED HOMEOWNER DOWNPAYMENT AS-
SISTANCE. 
(a) IN GENERAL.—Section 501 of the Internal Rev-
enue Code of 1986 (relating to exemption of tax on cor-
porations, certain trusts, etc.) is amended by redesig-
nating subsection (q) as subsection (r) and by inserting 
after subsection (p) the following new subsection:
‘‘(q) QUALIFIED HOMEOWNER DOWNPAYMENT AS-
SISTANCE.—
‘‘(1) IN GENERAL.—For purposes of subsection 
(c)(3) and sections 170(c)(2), 2055(a)(2), and 
2522(a)(2), the term ‘charitable purposes’ includes 
the provision of qualified homeowner downpayment 
assistance. 
‘‘(2) QUALIFIED HOMEOWNER DOWNPAYMENT 
ASSISTANCE.—For purposes of this subsection, the 
term ‘qualified homeowner downpayment assistance’ 
means a gift of cash for the purpose of providing 
any downpayment for a qualified home purchase. 
‘‘(3) QUALIFIED HOME PURCHASE.—
‘‘(A) IN GENERAL.—For purposes of this 
subsection, the term ‘qualified home purchase’ 
means the acquisition of any property as a prin-
cipal residence (within the meaning of section 
121) if the amount of the acquisition indebted-
ness (within the meaning of section 163(h)(3)) 
with respect to such property is less than the 
maximum mortgage amount applicable at the 
time the indebtedness is incurred for the area 
in which the property is located. 
‘‘(B) MAXIMUM MORTGAGE AMOUNT.—For 
purposes of this paragraph, the term ‘maximum
mortgage amount’ means the maximum single-
family home mortgage loan which would be eli-
gible for insurance from the Department of 
Housing and Urban Development pursuant to 
section 203(b) or 234(c) of the National Hous-
ing Act.’’. 
(b) NO CHARITABLE DEDUCTION FOR CONTRIBU-
TIONS FOR DOWNPAYMENT ASSISTANCE.—Subsection (f) 
of section 170 of the Internal Revenue Code of 1986 (re-
lating to disallowance of deduction in certain cases and 
special rules) is amended by adding at the end the fol-
lowing new paragraph: 
‘‘(11) DENIAL OF DEDUCTION OF CONTRIBU-
TIONS FOR DOWNPAYMENT ASSISTANCE.—No deduc-
tion shall be allowed under this section for a con-
tribution to an organization which provides home-
owner downpayment assistance if the contribution is 
made directly or indirectly in connection with a 
transaction in which the purchaser of a home re-
ceived downpayment assistance and the contrib-
utor—
‘‘(A) received the downpayment assistance, 
‘‘(B) sold the home to the purchaser, 
‘‘(C) loaned money to the purchaser, or
‘‘(D) otherwise received a commission or 
other benefit associated with the transaction.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years ending after the 
date of the enactment of this Act.
Æ