Title: End Hedge Fund Control of American Homes Act
Policy area: Taxation

Summary:
End Hedge Fund Control of American Homes Act
This bill imposes an excise tax, with certain exclusions, on individuals who own more than 100 single family homes. The amount of such tax is the product of $20,000 and the number of homes owned over 100.
The bill establishes a Housing Trust Fund into which the excise tax amounts shall be deposited and used to provide grants for down payment assistance.

[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 5151 Introduced in Senate (IS)]

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117th CONGRESS
  2d Session
                                S. 5151

 To prohibit individuals and entities from owning more than 100 single-
               family residences, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

            November 30 (legislative day, November 29), 2022

  Mr. Merkley introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To prohibit individuals and entities from owning more than 100 single-
               family residences, and for other purposes.

    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 ``End Hedge Fund Control of American 
Homes Act''.

SEC. 2. EXCISE TAX ON CERTAIN TAXPAYERS FAILING TO SELL EXCESS SINGLE-
              FAMILY RESIDENCES.

    (a) In General.--Subtitle D of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new chapter:

             ``CHAPTER 50B--EXCESS SINGLE-FAMILY RESIDENCES

``Sec. 5000E. Excess single-family residences.

``SEC. 5000E. EXCESS SINGLE-FAMILY RESIDENCES.

    ``(a) In General.--In the case of any covered taxpayer who fails to 
meet the requirement of subsection (b) for any taxable year, there is 
hereby imposed a tax equal to the product of--
            ``(1) $20,000, and
            ``(2) the excess of--
                    ``(A) the number of single-family residences owned 
                by the taxpayer as of the last day of the taxable year, 
                over
                    ``(B) 100.
    ``(b) Requirement.--A covered taxpayer meets the requirements of 
this section for any taxable year if the number of single-family 
residences owned by the covered taxpayer as of the last day of the 
taxable year is equal to or less than 90 percent of the number of 
single family homes owned by the covered taxpayer as of the first day 
of the taxable year.
    ``(c) Covered Taxpayer.--For purposes of this section--
            ``(1) In general.--The term `covered taxpayer' means, with 
        respect to any taxable year, any person who owns more than 100 
        single-family residences, as determined on the first day of the 
        taxable year.
            ``(2) Exclusions.--Such term shall not include--
                    ``(A) a mortgage note holder that owns a single-
                family residence through foreclosure,
                    ``(B) a organization which is described in section 
                501(c)(3) and exempt from tax under section 501(a),
                    ``(C) any person primarily engaged in the 
                construction or rehabilitation of single-family 
                residences, or
                    ``(D) any person who owns federally subsidized 
                housing.
            ``(3) Aggregation rules.--
                    ``(A) In general.--For purposes of this section, 
                all persons which are treated as a single employer 
                under subsections (a) and (b) of section 52 shall be 
                treated as a single taxpayer.
                    ``(B) Modifications.--For purposes of this 
                paragraph--
                            ``(i) section 52(a) shall be applied by 
                        substituting `component members' for `members', 
                        and
                            ``(ii) for purposes of applying section 
                        52(b), the term `trade or business' shall 
                        include any activity treated as a trade or 
                        business under paragraph (5) or (6) of section 
                        469(c) (determined without regard to the phrase 
                        `To the extent provided in regulations' in such 
                        paragraph (6)).
                    ``(C) Component member.--For purposes of this 
                paragraph, the term `component member' has the meaning 
                given such term by section 1563(b), except that the 
                determination shall be made without regard to section 
                1563(b)(2).
    ``(d) Other Rules and Definitions.--For purposes of this section--
            ``(1) Single-family residence.--The term `single-family 
        residence' means a residential property consisting of 1-to-4 
        dwelling units.
            ``(2) Own.--
                    ``(A) In general.--The term `own', with respect to 
                a single-family residence, means having a direct 
                majority ownership interest in the single-family 
                residence, regardless of the percentage of that 
                ownership interest.
                    ``(B) Special rule for certain sales.--
                            ``(i) In general.--Notwithstanding 
                        subparagraph (A), for purposes of subsections 
                        (a)(2)(A) and (b), any single-family residence 
                        which is owned by a covered taxpayer as of the 
                        first day of the taxable year and which is sold 
                        or transferred during such taxable year by the 
                        covered taxpayer in a sale or transfer 
                        described in clause (ii) shall be treated as a 
                        single-family residence which is owned by the 
                        covered taxpayer as of the last day of such 
                        taxable year.
                            ``(ii) Sales described.--A sale or transfer 
                        is described in this clause if such sale or 
                        transfer is a sale or transfer to--
                                    ``(I) a corporation or entity 
                                engaged in a trade or business,
                                    ``(II) a group of more than 2 
                                individuals, or
                                    ``(III) a person who owns any other 
                                single-family residence at the time of 
                                such sale.
    ``(e) Reporting.--
            ``(1) In general.--The Secretary shall require such 
        reporting as the Secretary determines necessary or appropriate 
        to carry out the purposes of this section, including reporting 
        with respect to whether any person acquiring a single-family 
        residence from a covered taxpayer owns any other single-family 
        residences at the time of the acquisition.
            ``(2) Failure to report.--
                    ``(A) In general.--Any person who fails to report 
                information required under paragraph (1) or who fails 
                to include correct information in such report shall pay 
                a penalty of $20,000.
                    ``(B) Reasonable cause waiver.--No penalty shall be 
                imposed under this paragraph with respect to any 
                failure if it is shown that such failure is due to 
                reasonable cause and not to willful neglect.
                    ``(C) Treatment of penalty.--The penalty under this 
                paragraph shall be paid upon notice and demand by the 
                Secretary, and shall be assessed and collected in the 
                same manner as an assessable penalty under subchapter B 
                of chapter 68.''.
    (b) Certification.--
            (1) In general.--The reporting required under section 
        5000E(a) of the Internal Revenue Code of 1986, as added by this 
        section, shall include a certification from each individual to 
        whom a single-family residence is sold or transferred from a 
        covered taxpayer.
            (2) Form of certification.--The certification required 
        under this subsection shall be signed by the purchaser or 
        transferee and state the following:
                    (A) The name and address of the purchaser or 
                transferee.
                    (B) The sale is not a sale described in section 
                5000E(d)(2)(B)(ii) of the Internal Revenue Code of 
                1986.
                    (C) The purchaser or transferee will be subject to 
                the penalty imposed under section 5000E(e)(2) of such 
                Code for any false certification.
            (3) Definitions.--Any term used in this subsection which is 
        used in section 5000E of the Internal Revenue Code of 1986 
        shall have the meaning give such term under such section.
    (c) Clerical Amendment.--The table of chapters for subtitle D of 
the Internal Revenue Code of 1986 is amended by adding at the end the 
following new item:

           ``Chapter 50B--Excess Single-Family Residences''.

    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2022.

SEC. 3. USE OF TAX REVENUES FOR DOWN PAYMENT ASSISTANCE GRANTS.

    (a) Establishment of Housing Trust Fund.--
            (1) In general.--Subchapter A of chapter 98 of the Internal 
        Revenue Code of 1986 is amended by adding at the end the 
        following new section:

``SEC. 9512. HOUSING TRUST FUND.

    ``(a) Creation of Trust Fund.--There is established in the Treasury 
of the United States a trust fund to be known as the Housing Trust Fund 
(hereinafter in this section referred to as the `Trust Fund'), 
consisting of such amounts as may be appropriated or credited to such 
Trust Fund as provided in this section and section 9602(b).
    ``(b) Transfers to Trust Fund.--There are hereby appropriated to 
the Housing Trust Fund amounts equivalent to revenues received in the 
Treasury from the tax imposed by section 5000E.
    ``(c) Expenditures From Trust Fund.--Amounts in the Housing Trust 
Fund shall be available, as provided in appropriations Acts, only for 
grants under section 3(b) of the End Hedge Fund Control of American 
Homes Act.''.
            (2) Clerical amendment.--The table of sections for 
        subchapter A of chapter 98 of the Internal Revenue Code of 1986 
        is amended by adding at the end the following new item:
    (b) Grants Program for Down Payment Assistance Programs.--
            (1) Establishment.--The Secretary of Housing and Urban 
        Development shall establish a program under which the Secretary 
        makes grants to State housing finance agencies to establish new 
        or supplement existing programs that provide down payment 
        assistance to families purchasing homes within the State.
            (2) Priority.--A State housing finance agency that receives 
        a grant under this section shall give priority to families 
        seeking assistance to purchase any single-family residence that 
        is sold or transferred by a covered taxpayer (as defined in 
        section 5000E(c) of the Internal Revenue Code of 1986, as added 
        by section 2).
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