Revitalizing Economies, Housing, And Businesses Act of 2021
Bill: H.R.1483 | Sponsor: Rep. Blumenauer, Earl (D-OR)
Policy area: Taxation

Summary:
Revitalizing Economies, Housing, And Businesses Act of 2021 or the REHAB Act of 2021
This bill modifies provisions relating to the rehabilitation tax credit. Specifically, the bill allows an increased 15% credit for non-historic buildings placed in service 50 years prior to the current calendar year. It also allows the credit for buildings within a half-mile of public transportation facilities, for residential lodging purposes, and for expenses related to building expansion on the same block as a qualified rehabilitation building.
The bill allows a 25% credit for rent-restricted housing units and for expenses related to public infrastructure projects required by state or local governments as a condition of project completion.

To amend the Internal Revenue Code of 1986 to modify the rehabilitation 
                                credit.

    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 ``Revitalizing Economies, Housing, And 
Businesses Act of 2021'' or as the ``REHAB Act of 2021''.

SEC. 2. MODIFICATION OF REHABILITATION CREDIT.

    (a) Reinstatement of Credit for Qualified Rehabilitated 
Buildings.--
            (1) In general.--Subsection (a) of section 47 of the 
        Internal Revenue Code of 1986 is amended to read as follows:
    ``(a) Determination of Credit.--
            ``(1) In general.--For purposes of section 46, the 
        rehabilitation credit for any taxable year is the sum of--
                    ``(A) in the case of any qualified rehabilitated 
                building other than a certified historic structure 
                which is placed in service during such taxable year, 10 
                percent of the qualified rehabilitation expenditures 
                with respect to such building, and
                    ``(B) in the case of any qualified rehabilitated 
                building which is a certified historic structure which 
                is placed in service during such taxable year or any of 
                the 4 immediately preceding taxable years, the ratable 
                share for such taxable year.
            ``(2) Ratable share.--For purposes of paragraph (1)(B), the 
        ratable share for any taxable year is an amount equal to 20 
        percent of the qualified rehabilitation expenditures with 
        respect to the certified historic structure, as allocated 
        ratably to each of the 5 years to which paragraph (1)(B) 
        applies.''.
            (2) Conforming amendments.--
                    (A) Section 47(c) of such Code is amended--
                            (i) in paragraph (1)--
                                    (I) in subparagraph (A), by 
                                amending clause (iii) to read as 
                                follows:
                            ``(iii) in the case of any building other 
                        than a certified historic structure, in the 
                        rehabilitation process--
                                    ``(I) 50 percent or more of the 
                                existing external walls of such 
                                building are retained in place as 
                                external walls,
                                    ``(II) 75 percent or more of the 
                                existing external walls of such 
                                building are retained in place as 
                                internal or external walls, and
                                    ``(III) 75 percent or more of the 
                                existing internal structural framework 
                                of such building is retained in place, 
                                and'', and
                                    (II) by redesignating subparagraphs 
                                (B) and (C) as subparagraphs (C) and 
                                (D), respectively, and by inserting 
                                after subparagraph (A) the following 
                                new subparagraph:
                    ``(B) Building must be first placed in service 
                before 1936.--In the case of a building other than a 
                certified historic structure, a building shall not be a 
                qualified rehabilitated building unless the building 
                was first placed in service before 1936.'', and
                            (ii) in paragraph (2)(B), by amending 
                        clause (iv) to read as follows:
                            ``(iv) Certified historic structure, etc.--
                        Any expenditure attributable to the 
                        rehabilitation of a certified historic 
                        structure or a building in a registered 
                        historic district, unless the rehabilitation is 
                        a certified rehabilitation (within the meaning 
                        of subparagraph (C)). The preceding sentence 
                        shall not apply to a building in a registered 
                        historic district if--
                                    ``(I) such building was not a 
                                certified historic structure,
                                    ``(II) the Secretary of the 
                                Interior certified to the Secretary 
                                that such building is not of historic 
                                significance to the district, and
                                    ``(III) if the certification 
                                referred to in subclause (II) occurs 
                                after the beginning of the 
                                rehabilitation of such building, the 
                                taxpayer certifies to the Secretary 
                                that, at the beginning of such 
                                rehabilitation, he in good faith was 
                                not aware of the requirements of 
                                subclause (II).''.
                    (B) Paragraph (4) of section 145(d) of such Code is 
                amended--
                            (i) by striking ``of section 47(c)(1)(B)'' 
                        each place it appears and inserting ``of 
                        section 47(c)(1)(C)'', and
                            (ii) by striking ``section 47(c)(1)(B)(i)'' 
                        and inserting ``section 47(c)(1)(C)(i)''.
    (b) Increase in Credit Rate for Qualified Rehabilitated Buildings 
Other Than Certified Historic Structures.--Section 47(a)(1) of such 
Code, as amended by subsection (a), is amended by striking ``10 
percent'' and inserting ``15 percent''.
    (c) Modification of Date Before Which Buildings Other Than 
Certified Historic Structures Must Be Placed in Service.--Section 
47(c)(1)(B) of such Code, as amended by subsection (a), is amended by 
striking ``1936'' and inserting ``the calendar year which is 50 years 
prior to the calendar year in which the building is placed in service 
(within the meaning of subsection (b)(1))''.
    (d) Requirement That Buildings Other Certified Historic Structures 
Must Be Close to Public Transportation Centers.--Section 47(c)(1) of 
such Code, as amended by subsection (a), is amended by redesignating 
subparagraphs (C) and (D) as subparagraphs (D) and (E), respectively, 
and by inserting after subparagraph (B) the following new subparagraph:
                    ``(C) Building must be close to public 
                transportation center.--
                            ``(i) In general.--In the case of a 
                        building other than a certified historic 
                        structure, a building shall not be a qualified 
                        rehabilitated building unless the building is 
                        not further than one-half mile from at least 
                        one of the following:
                                    ``(I) A location which provides 
                                passenger boarding on a fixed guideway 
                                (as defined in section 5302(7) of title 
                                49, United States Code), commuter rail 
                                passenger transportation (as defined in 
                                section 24102(3) of title 49, United 
                                States Code), or intercity rail 
                                passenger transportation (as defined in 
                                section 24102(4) of title 49, United 
                                States Code).
                                    ``(II) A planned site for a 
                                location described in subclause (I) if 
                                the Secretary of Transportation has 
                                issued a full funding grant agreement 
                                with respect to such location under 
                                section 5309(k)(2) of title 49, United 
                                States Code.
                            ``(ii) Identification of qualified areas.--
                        The Secretary, in consultation with the 
                        Secretary of Transportation, shall identify 
                        areas which are described in clause (i).''.
    (e) Elimination of Certain Lodging Restrictions on Buildings Other 
Than Certified Historic Structures.--Section 50(b)(2)(C) of such Code 
is amended by striking ``certified historic structure'' and inserting 
``qualified rehabilitated building''.
    (f) Requirement That Buildings That Are Not Certified Historic 
Structures and Not in a Registered Historic District Receive 
Certification of Status.--Section 47(c)(1) of such Code, as amended by 
subsections (a) and (d), is amended by redesignating subparagraphs (D) 
and (E) as subparagraphs (E) and (F), respectively, and by inserting 
after subparagraph (C) the following new subparagraph:
                    ``(D) Buildings that are not certified historic 
                structures and not in registered historic district must 
                receive certification of status.--
                            ``(i) In general.--In the case of a 
                        building which is neither a certified historic 
                        structure nor located in a registered historic 
                        district, such building shall not be a 
                        qualified rehabilitated building unless the 
                        Secretary of the Interior certifies to the 
                        Secretary that such building is--
                                    ``(I) not a certified historic 
                                structure, and
                                    ``(II) not in a registered historic 
                                district.
                            ``(ii) Determinations by national park 
                        service.--To the maximum extent practicable, 
                        the Secretary of the Interior shall make 
                        certifications under clause (i) within 30 days 
                        of the receipt of an application for such 
                        certification.''.
    (g) Credit for Certain Related Expenditures.--
            (1) Credit for certain expenditures for public 
        infrastructure.--Section 47(c)(2) of such Code is amended by 
        adding at the end the following new subparagraph:
                    ``(E) Treatment of certain expenditures for public 
                infrastructure.--
                            ``(i) In general.--In the case of any 
                        qualified rehabilitated building, expenditures 
                        for qualified public infrastructure (or 
                        improvements thereto) shall be treated for 
                        purposes of this section as qualified 
                        rehabilitation expenditures with respect to 
                        such building if providing such qualified 
                        public infrastructure is related to such 
                        building and is required by any State or local 
                        government.
                            ``(ii) Limitation.--The amount treated as 
                        qualified rehabilitation expenditures with 
                        respect to any building under clause (i) shall 
                        not exceed 25 percent of the qualified 
                        rehabilitation expenditures with respect to 
                        such building (determined after the application 
                        of clause (i) and subparagraph (F)).
                            ``(iii) Bonus credit amount.--In the case 
                        of any amount treated as qualified 
                        rehabilitation expenditures under clause (i), 
                        subsection (a)(1) shall be applied by 
                        substituting `25 percent' for `15 percent'.
                            ``(iv) Qualified public infrastructure.--
                        For purposes of this subparagraph, the term 
                        `qualified public infrastructure' means water 
                        and sewer lines, electrical lines and 
                        equipment, telecommunications lines and 
                        equipment, and road and sidewalks, which are 
                        located in the public right of way and are not 
                        owned by the taxpayer.''.
            (2) Credit for expansion and adjacent buildings with 
        respect to qualified rehabilitated buildings other than 
        certified historic structures.--Section 47(c)(2) of such Code, 
        as amended by paragraph (1), is amended by adding at the end 
        the following new subparagraph:
                    ``(F) Treatment of building expansions and certain 
                adjacent buildings with respect to qualified 
                rehabilitated buildings other than certified historic 
                structures.--
                            ``(i) In general.--In the case any 
                        qualified rehabilitated building other than a 
                        certified historic structure--
                                    ``(I) clause (iii) of subparagraph 
                                (B) shall not apply, and
                                    ``(II) amounts described in 
                                subparagraph (A)(i) which are in 
                                connection with the rehabilitation or 
                                construction of a qualified adjacent 
                                building shall be treated as qualified 
                                rehabilitation expenditures with 
                                respect to such qualified rehabilitated 
                                building.
                            ``(ii) Limitation.--The amount treated as 
                        qualified rehabilitation expenditures with 
                        respect to any qualified rehabilitated building 
                        under clause (i) shall not exceed 100 percent 
                        of the qualified rehabilitation expenditures 
                        with respect to such building (determined 
                        without regard to clause (i) and subparagraph 
                        (E)).
                            ``(iii) Qualified adjacent building.--For 
                        purposes of this subparagraph, the term 
                        `qualified adjacent building' means, with 
                        respect to any qualified rehabilitated 
                        building, any building if such building and 
                        such qualified rehabilitated building are both 
                        on the same block.''.
            (3) Expenditures related to public infrastructure, adjacent 
        buildings, and building expansions disregarded in determining 
        if rehabilitation is substantial.--Section 47(c)(1)(E), as 
        redesignated by subsections (a), (d), and (f), is amended by 
        adding at the end the following new clause:
                            ``(iv) Certain expenditures disregarded.--
                        Amounts which are otherwise treated as 
                        qualified rehabilitation expenditures by reason 
                        of subparagraph (E) or (F) of paragraph (2) 
                        shall not be treated as qualified 
                        rehabilitation expenditures for purposes of 
                        this subparagraph.''.
    (h) Bonus Credit for Rent-Restricted Housing Units.--Section 47 of 
such Code is amended by adding at the end the following new subsection:
    ``(e) Bonus Credit for Rent-Restricted Housing Units.--
            ``(1) In general.--Subsection (a)(1) shall be applied by 
        substituting `25 percent' for `15 percent' with respect to so 
        much of the qualified rehabilitation expenditures (determined 
        without regard to subsection (c)(2)(E)) with respect to any 
        qualified rehabilitated building as are properly allocable to 
        residential units which are--
                    ``(A) rent-restricted (within the meaning of 
                section 42(g)(2)), and
                    ``(B) occupied by individuals whose income is 100 
                percent or less of area median gross income (within the 
                meaning of section 42(g)(1)).
            ``(2) Failure to maintain rent-restriction subject to 
        recapture.--In the case of any failure to maintain any 
        residential unit taken into account under paragraph (1) as a 
        residential unit described in such paragraph during the 
        recapture period, section 50(a) shall apply as though the 
        qualified rehabilitated building ceased to be investment credit 
        property except that the recapture period and recapture 
        percentage shall be determined under paragraph (3) and in 
        determining the increase in tax under such section in lieu of 
        reducing the credit determined under this section to zero such 
        credit shall be determined without regard to paragraph (1). The 
        application of section 50(a) with respect to a building as 
        described in this paragraph shall not prevent the reapplication 
        of such section to such building if such building is disposed 
        of or otherwise ceases to be investment credit property and the 
        tax imposed under such section by reason of such reapplication 
        shall be reduced by the tax previously imposed as described in 
        this paragraph.
            ``(3) Recapture period; recapture percentage.--For purposes 
        of this subsection--
                    ``(A) Recapture period.--The term `recapture 
                period' means the 10-year period beginning on the date 
                the building is placed in service.
                    ``(B) Recapture percentage.--The term `recapture 
                percentage' means--
                            ``(i) in the case of a failure described in 
                        paragraph (2) that occurs during the first year 
                        of the recapture period, 100 percent, and
                            ``(ii) in the case of such a failure which 
                        occurs during any subsequent year of the 
                        recapture period, the percentage which is 10 
                        percentage points less than the percentage 
                        which applied for the previous year (as 
                        determined under this subparagraph).''.
    (i) Public Reporting.--Section 47 of such Code, as amended by 
subsection (h), is amended by adding at the end the following new 
subsection:
    ``(f) Public Reporting With Respect to Qualified Rehabilitated 
Buildings Other Than Certified Historic Structures.--
            ``(1) In general.--No credit shall be allowed under this 
        section with respect to any qualified rehabilitated building 
        other than a certified historic structure unless the taxpayer 
        submits to the Secretary a report (at such time and in such 
        manner as the Secretary may provide) which includes the 
        information described in paragraph (2).
            ``(2) Information.--The report described in paragraph (1) 
        shall include the following:
                    ``(A) The name of the building and, if applicable, 
                the name of the project of which such building is a 
                part.
                    ``(B) Each of the following with respect to the 
                location of the building: city, State, zip code, 2010 
                census tract (and whether such tract is metropolitan 
                statistical area).
                    ``(C) The total cost of the building and, if 
                applicable, the total cost of the project of which such 
                building is a part.
                    ``(D) The total amount of credit allowed under this 
                section with respect to such building and, if 
                applicable, with respect to the project of which such 
                building is a part.
                    ``(E) The year the building is placed in service.
                    ``(F) The number of housing units in the building 
                and number of such housing units which are rent-
                restricted (within the meaning of section 42(g)(2)).
                    ``(G) The primary purpose of the building.
            ``(3) Reports made publicly available.--The Secretary shall 
        ensure that reports made under paragraph (1) are made available 
        to the public.''.
    (j) Effective Date.--The amendments made by this section shall 
apply to property the construction of which begins after the date of 
the enactment of this Act.
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