Affordable HOUSE Act of 2021
Bill: H.R.4204 | Sponsor: Rep. Neguse, Joe (D-CO)
Policy area: Taxation

Summary:
Affordable Housing Opportunities for Utilization, Sustainment, and Expansion Act of 2021 or the Affordable HOUSE Act of 2021
This bill modifies the low-income housing tax credit basis limitation rules applicable to the acquisition of buildings in service within the previous 10 years.

To amend the Internal Revenue Code of 1986 to modify the low-income 
housing credit basis limitation rules in the case of the acquisition of 
                         an existing building.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Affordable Housing Opportunities for 
Utilization, Sustainment, and Expansion Act of 2021'' or the 
``Affordable HOUSE Act of 2021''.

SEC. 2. MODIFICATION OF PREVIOUS OWNERSHIP RULES; LIMITATION ON 
              ACQUISITION BASIS.

    (a) Limitation on Acquisition Basis.--
            (1) In general.--Section 42(d)(2)(B)(ii) of the Internal 
        Revenue Code of 1986 is amended by inserting ``, or the 
        taxpayer elects the application of subparagraph (C)(ii)'' after 
        ``service''.
            (2) Limitation.--Section 42(d)(2)(C) of such Code is 
        amended--
                    (A) by striking ``for purposes of subparagraph (A), 
                the adjusted basis'' and inserting the following: ``For 
                purposes of subparagraph (A)--
                            ``(i) In general.--The adjusted basis'', 
                        and
                    (B) by adding at the end the following new clauses:
                            ``(ii) Buildings in service within previous 
                        10 years.--If the period between the date of 
                        acquisition of the building by the taxpayer and 
                        the date the building 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 adjusted basis shall not exceed 
                        the sum of--
                                    ``(I) the lowest amount paid for 
                                acquisition of the building by any 
                                person during the 10 years preceding 
                                the date of the acquisition of the 
                                building by the taxpayer, adjusted as 
                                provided in clause (iii), and
                                    ``(II) the value of any capital 
                                improvements 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 2016 in 
                                subparagraph (A)(ii) thereof.
                        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.''.
            (3) Conforming amendments.--Section 42(d)(2)(D)(i) of such 
        Code is amended--
                    (A) by striking ``for subparagraph (b)'' in the 
                heading, and
                    (B) by striking ``subparagraph (B)'' in the matter 
                preceding subclause (I) and inserting ``subparagraph 
                (B)(ii) or (C)(ii)''.
    (b) Modification of Placed in Service Rule.--Section 
42(d)(2)(B)(iii) of such Code is amended to read as follows:
                            ``(iii) the building was not owned by the 
                        taxpayer or by any person related (as of the 
                        date of acquisition by the taxpayer) to the 
                        taxpayer at any time during the 5-year period 
                        ending on the date of acquisition by the 
                        taxpayer, and''.
    (c) Effective Date.--The amendments made by this section shall 
apply to buildings placed in service after December 31, 2020.
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