Title: Taxi Medallion Loan Forgiveness Debt Relief Act of 2021
Policy area: Taxation

Summary:
Taxi Medallion Loan Forgiveness Debt Relief Act of 2021
This bill excludes from gross income, for income tax purposes, income of a taxpayer, other than a C corporation, attributable to the discharge of qualified taxi medallion indebtedness that is discharged before 2023.

[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2077 Introduced in House (IH)]

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117th CONGRESS
  1st Session
                                H. R. 2077

  To amend the Internal Revenue Code of 1986 to exclude discharges of 
           indebtedness on taxi medallions from gross income.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 19, 2021

   Mr. Meeks (for himself, Mrs. Carolyn B. Maloney of New York, Mr. 
   Suozzi, Ms. Velazquez, Miss Rice of New York, Mr. Espaillat, Ms. 
 Ocasio-Cortez, Mr. Nadler, Mr. Torres of New York, Ms. Clarke of New 
    York, Ms. Meng, Mr. Jeffries, Ms. Malliotakis, and Mr. Bowman) 
 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 exclude discharges of 
           indebtedness on taxi medallions from gross income.

    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 ``Taxi Medallion Loan Forgiveness Debt 
Relief Act of 2021''.

SEC. 2. EXCLUSION OF DISCHARGES OF QUALIFIED TAXI MEDALLION 
              INDEBTEDNESS.

    (a) In General.--Section 108(a)(1) of the Internal Revenue Code of 
1986 is amended by striking ``or'' at the end of subparagraph (D), by 
striking the period at the end of subparagraph (E) and inserting ``, 
or'', and by inserting after subparagraph (E) the following new 
subparagraph:
                    ``(F) in the case of a taxpayer other than a C 
                corporation, the indebtedness discharged is qualified 
                taxi medallion indebtedness which is discharged before 
                January 1, 2023.''.
    (b) Special Rules Relating to Qualified Taxi Medallion 
Indebtedness.--Section 108 of such Code is amended by adding at the end 
the following new subsection:
    ``(j) Special Rules Relating to Qualified Taxi Medallion 
Indebtedness.--
            ``(1) Basis reduction.--The amount excluded from gross 
        income by reason of subsection (a)(1)(E) shall be applied to 
        reduce (but not below zero) the basis of the taxi medallions of 
        the taxpayer that secure the discharged indebtedness.
            ``(2) Qualified taxi medallion indebtedness.--For purposes 
        of this section--
                    ``(A) In general.--The term `qualified taxi 
                medallion indebtedness' means indebtedness which--
                            ``(i) is secured by a taxi medallion, and
                            ``(ii) with respect to which such taxpayer 
                        makes an election to have this paragraph apply.
                    ``(B) Limitation.--With respect to a taxpayer, the 
                aggregate amount treated as qualified taxi medallion 
                indebtedness for any period shall not exceed $2,000,000 
                ($1,000,000 in the case of a married individual filing 
                a separate return).
                    ``(C) Exception for certain discharges not related 
                to taxpayer's financial condition.--Subsection 
                (a)(1)(F) shall not apply to the discharge of a loan if 
                the discharge is on account of services performed for 
                the lender or any other factor not directly related to 
                a decline in the value of the taxi medallion or to the 
                financial condition of the taxpayer.
                    ``(D) Ordering rule.--If any loan is discharged, in 
                whole or in part, and only a portion of such loan is 
                qualified taxi medallion indebtedness, subsection 
                (a)(1)(F) shall apply only to so much of the amount 
                discharged as exceeds the amount of the loan (as 
                determined immediately before such discharge) which is 
                not qualified taxi medallion indebtedness.''.
    (c) Conforming Amendments.--
            (1) Section 108(a)(2) of such Code is amended by adding at 
        the end the following new subparagraph:
                    ``(D) Taxi medallion exclusion takes precedence 
                over insolvency exclusion unless elected otherwise.--
                Paragraph (1)(B) shall not apply to a discharge to 
                which paragraph (1)(F) applies unless the taxpayer 
                elects to apply paragraph (1)(B) in lieu of paragraph 
                (1)(F).''.
    (d) Effective Date.--The amendments made by this section shall 
apply to discharges of indebtedness after December 31, 2016.
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