I 
110TH CONGRESS 
2D SESSION 
H. R. 5974 
To amend the Internal Revenue Code of 1986 to provide a Federal income 
tax credit for certain home purchases. 
IN THE HOUSE OF REPRESENTATIVES 
MAY 6, 2008 
Mr. TERRY (for himself, Mr. SESSIONS, Mr. CANTOR, Mr. FOSSELLA, Mr. 
WILSON of South Carolina, Mrs. CAPITO, Mr. MARCHANT, and Mr. 
BLUNT) introduced the following bill; which was referred to the Com-
mittee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
a Federal income tax credit for certain home purchases. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. CREDIT FOR CERTAIN HOME PURCHASES. 
(a) ALLOWANCE OF CREDIT.—Subpart A of part IV 
of subchapter A of chapter 1 of the Internal Revenue Code 
of 1986 (relating to refundable credits) is amended by in-
serting after section 25D the following new section: 
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‘‘SEC. 25E. CREDIT FOR CERTAIN HOME PURCHASES. 
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in-
dividual who purchases a principal residence in the United 
States during the 12-month period beginning on the date 
of the enactment of this section, there shall be allowed 
to the taxpayer as a credit against the tax imposed by 
this chapter for the taxable year an amount equal to 10 
percent of the purchase price of the residence. 
‘‘(b) LIMITATIONS.— 
‘‘(1) DOLLAR LIMITATION.—The credit allowed 
under subsection (a) shall not exceed $10,000. 
‘‘(2) DENIAL OF CREDIT FOR RESIDENCES AC-
QUIRED WITH NONCONFORMING LOANS.—No credit 
shall be allowed under subsection (a) with respect to 
the purchase of any residence if the aggregate acqui-
sition 
indebtedness 
(as 
defined 
in 
section 
163(h)(3)(B)) with respect to such residence exceeds 
the limitation on the maximum original principal ob-
ligation of a mortgage that may be purchased by the 
Federal Home Loan Mortgage Corporation (as such 
limitation is in effect at the time of such purchase). 
‘‘(3) LIMITATION
BASED
ON
AMOUNT
OF 
TAX.—In the case of a taxable year to which section 
26(a)(2) does not apply, the credit allowed under 
subsection (a) for any taxable year shall not exceed 
the excess of— 
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‘‘(A) the sum of the regular tax liability 
(as defined in section 26(b)) plus the tax im-
posed by section 55, over 
‘‘(B) the sum of the credits allowable 
under this subpart (other than this section) for 
the taxable year. 
‘‘(4) ONE-TIME ONLY.— 
‘‘(A) IN GENERAL.—If a credit is allowed 
under this section in the case of any individual 
(and such individual’s spouse, if married) with 
respect to the purchase of any principal resi-
dence, no credit shall be allowed under this sec-
tion in any taxable year with respect to the pur-
chase of any other principal residence by such 
individual or a spouse of such individual. 
‘‘(B) JOINT PURCHASE.—In the case of a 
purchase of a principal residence by 2 or more 
unmarried individuals or by 2 married individ-
uals filing separately, no credit shall be allowed 
under this section if a credit under this section 
has been allowed to any of such individuals in 
any taxable year with respect to the purchase of 
any other principal residence. 
‘‘(c) CARRYFORWARD OF UNUSED CREDIT.— 
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‘‘(1) RULE
FOR
YEARS
IN
WHICH
ALL
PER-
SONAL CREDITS ALLOWED AGAINST REGULAR AND 
ALTERNATIVE MINIMUM TAX.—In the case of a tax-
able year to which section 26(a)(2) applies, if the 
credit allowable under subsection (a) exceeds the 
limitation imposed by section 26(a)(2) for such tax-
able year reduced by the sum of the credits allowable 
under this subpart (other than this section), such 
excess shall be carried to the succeeding taxable year 
and added to the credit allowable under subsection 
(a) for such succeeding taxable year. 
‘‘(2) RULE FOR OTHER YEARS.—In the case of 
a taxable year to which section 26(a)(2) does not 
apply, if the credit allowable under subsection (a) 
exceeds the limitation imposed by subsection (b)(3) 
for such taxable year, such excess shall be carried to 
the succeeding taxable year and added to the credit 
allowable under subsection (a) for such succeeding 
taxable year. 
‘‘(3) LIMITATION.—No credit may be carried 
forward under this subsection to any taxable year 
following the first taxable year after the taxable year 
in which the credit arose. 
‘‘(d) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
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‘‘(1) ALLOCATION OF DOLLAR LIMIT.— 
‘‘(A) MARRIED INDIVIDUALS FILING SEPA-
RATELY.—In the case of a married individual 
filing a separate return, subsection (b)(1) shall 
be 
applied 
by 
substituting 
‘$5,000’ 
for 
‘$10,000’. 
‘‘(B) OTHER
INDIVIDUALS.—If two or 
more individuals who are not married purchase 
a principal residence, 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 all such indi-
viduals shall not exceed $10,000. 
‘‘(2) PRINCIPAL RESIDENCE.—The term ‘prin-
cipal residence’ has the same meaning as when used 
in section 121. 
‘‘(3) PURCHASE.— 
‘‘(A) IN GENERAL.—The term ‘purchase’ 
means any acquisition, but only if— 
‘‘(i) the property is not acquired from 
a person related to the person acquiring it, 
and 
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‘‘(ii) the basis of the property in the 
hands of the person acquiring it is not de-
termined— 
‘‘(I) in whole or in part by ref-
erence to the adjusted basis of such 
property in the hands of the person 
from whom acquired, or 
‘‘(II) under section 1014(a) (re-
lating to property acquired from a de-
cedent). 
‘‘(B) CONSTRUCTION.—A residence which 
is constructed by the taxpayer shall be treated 
as purchased by the taxpayer on the date the 
taxpayer first occupies such residence. 
‘‘(4) PURCHASE
PRICE.—The term ‘purchase 
price’ means the adjusted basis of the principal resi-
dence on the date such residence is purchased. 
‘‘(5) RELATED
PERSONS.—A person shall be 
treated as related to another person if the relation-
ship between such persons would result in the dis-
allowance of losses under section 267 or 707(b) (but, 
in applying section 267(b) and (c) for purposes of 
this section, paragraph (4) of section 267(c) shall be 
treated as providing that the family of an individual 
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shall include only his spouse, ancestors, and lineal 
descendants). 
‘‘(e) EXCEPTIONS.—No credit under subsection (a) 
shall be allowed to any taxpayer for any taxable year with 
respect to the purchase of a residence if— 
‘‘(1) a credit under section 1400C (relating to 
first-time homebuyer in the District of Columbia) is 
allowable to the taxpayer (or the taxpayer’s spouse) 
for such taxable year or any prior taxable year, 
‘‘(2) the taxpayer is a nonresident alien, or 
‘‘(3) the taxpayer disposes of such residence (or 
such residence ceases to be the principal residence of 
the taxpayer (and, if married, the taxpayer’s 
spouse)) before the close of such taxable year. 
‘‘(f) REPORTING REQUIREMENT.—Rules similar to 
the rules of section 1400C(f) (as so in effect) shall apply. 
‘‘(g) BASIS ADJUSTMENT.—For purposes of this sub-
title, if a credit is allowed under this section with respect 
to the purchase of any residence, the basis of such resi-
dence shall be reduced by the amount of the credit so al-
lowed. 
‘‘(h) APPLICATION.—This section shall not apply to 
any taxable year beginning after December 31, 2009.’’. 
(b) CONFORMING AMENDMENTS.— 
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