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Q: SECTION 1. SHORT TITLE.

This Act may be cited as the ''Responsible Homeowner Relief Act of
2010''.

SEC. 2. DEDUCTION FOR LOSS FROM SALE OF PRINCIPAL RESIDENCE.

(a) In General.--Part VII of subchapter B of chapter I of the
Internal Revenue Code of 1986 (relating to additional itemized
deductions for individuals) is amended by redesignating section 224 as
section 225 and by inserting after section 223 the following new
section:

''SEC. 224. LOSS FROM SALE OF PRINCIPAL RESIDENCE.

''(a) Allowance of Deduction.--In the case of an individual, there
shall be allowed as a deduction for the taxable year any loss
recognized on the sale or exchange of property during the taxable year
if, during the 5-year period ending on the date of the sale or
exchange, such property has been owned and used by the taxpayer as the
taxpayer's principal residence for periods aggregating 2 years or more.
''(b) Limitations.--
''(1) Aggregate limitation.--The aggregate amount allowed
as a deduction under subsection (a) for all taxable years shall
not exceed $9,000.
''(2) Annual limitation.--
''(A) In general.--The amount allowed to a taxpayer
as a deduction under subsection (a) for a taxable year
shall not exceed $3,000.
''(B) Carryforward.--If the deduction allowable
under subsection (a) for any taxable year exceeds the
limitation imposed by subparagraph (A) for the taxable
year, the excess shall be carried to each of the 2
succeeding taxable years and added to the deduction
allowable under subsection (a) for such succeeding
year.
''(3) Exclusion of loss allocated to nonqualified use.--
''(A) In general.--Subsection (a) shall not apply
to so much of the loss from the sale or exchange of
property as is allocated to periods of nonqualified
use.
''(B) Allocation.--For purposes of subparagraph
(A), loss shall be allocated to periods of nonqualified
use based on the ratio which--
''(i) the aggregate periods of nonqualified
use during the period such property was owned
by the taxpayer, bears to
''(ii) the period such property was owned
by the taxpayer.
''(C) Period of nonqualified use; coordination with
recognition of gain attributable to depreciation.--For
purposes of this paragraph, rules similar to the rules
of subparagraphs (C) and (D) of section 121(b)(5) shall
apply.
''(4) Application to only 1 sale.--
''(A) In general.--Subsection (a) shall not apply
to more than 1 sale or exchange of a principal
residence by the taxpayer.
''(B) Special rule for joint returns.--In the case
of a joint return with respect to the sale or exchange
of a principal residence, if a deduction was allowable
under subsection (a) to a spouse for a prior sale or
exchange of a principal residence, paragraphs (1) and
(2)(A) shall be applied by reducing the dollar amounts
therein by the deduction so allowable (one-half of such
deduction in the case of a joint return).
''(5) Sale or exchange with related person.--
''(A) In general.--Subsection (a) shall not apply
to any sale or exchange to a related person.
''(B) Related person.--For purposes of this
subparagraph (A), a person (hereinafter in this
subparagraph referred to as the 'related person') is
related to any person if--
''(i) the related person bears a
relationship to such person specified in
section 267(b) or section 707(b)(1), or
''(ii) the related person and such person
are engaged in trades or business under common
control (within the meaning of subsections (a)
and (b) of section 52).
For purposes of clause (i), in applying section 267(b)
or 707(b)(1), '10 percent' shall be substituted for '50
percent'.
''(c) Home Sales Price Must Be Consistent With Local Market.--The
sale or exchange of a principal residence shall not be taken into
account for purposes of subsection (a) unless the taxpayer demonstrates
to the satisfaction of the Secretary that the price for which such home
is sold (or value received in the case of an exchange) is consistent
with local property values of dwellings of a similar size and condition
at the time of such sale or exchange.
''(d) Applicable Rules.--For purposes of this section, rules
similar to the rules of subsection (d) of section 121 shall apply,
except that paragraph (6) thereof shall be applied by substituting
'loss' for 'gain'.
''(e) Election To Have Section Not Apply.--This section shall not
apply to any sale or exchange with respect to which the taxpayer elects
not to have this section apply.
''(f) Termination.--The section shall not apply to the sale or
exchange of a principal residence after December 31, 2012.''.
(b) Deduction Allowed in Computing Adjusted Gross Income.--
Subsection (a) of section 62 of such Code is amended by inserting
before the last sentence the following new paragraph:
''(22) Loss from sale of principal residence.--The
deduction allowed by section 224.''.
(c) Conforming Amendments.--
(1) Section 165(c) of such Code is amended by striking
''and'' at the end of paragraph (2), by striking the period at
the end of paragraph (3) and inserting ''; and'', and by
inserting after paragraph (3) the following new paragraph:
''(4) to the extent provided in section 224, losses from
the sale or exchange of a principal residence.''.
(2) Section 165(f) of such Code is amended by inserting
''and in section 224 in the case of losses from the sale or
exchange of a principal residence'' before the period at the
end.
(d) Clerical Amendment.--The table of sections for part VII of
subchapter B of chapter 1 of such Code is amended by striking the item
relating to section 224 and inserting the following:

''Sec. 224. Loss from sale of principal residence.''.
(e) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2008.

SEC. 3. WAIVER OF FANNIE MAE AND FREDDIE MAC WAITING PERIOD
REQUIREMENTS AFTER SHORT SALE FOR CERTAIN MORTGAGORS.

(a) In General.--The Federal National Mortgage Association and the
Federal Home Loan Mortgage Corporation shall waive the applicability of
any short sale waiting period requirement with respect to the purchase
and any commitment to purchase, by such Association or Corporation, of
a covered mortgage if the mortgagor under such covered mortgage--
(1) was, at the time of the short sale of the principal
dwelling of such mortgagor that was subject to the previous
mortgage, current on all payments due under the mortgage
satisfied by such short sale; and
(2) has a credit score greater than the equivalent of a
FICO score of 679.
(b) Definitions.--For purposes of this section, the following
definitions shall apply:
(1) Covered mortgage.--The term ''covered mortgage'' means
a mortgage under which the mortgagor is an individual who was
previously the mortgagor under another mortgage on the
principal dwelling of such mortgagor, which principal dwelling
was sold in a short sale.
(2) Short sale.--The term ''short sale'', with respect to
an individual, has the meaning given such term under section
605(a)(7)(B) of the Fair Credit Reporting Act.
(3) Short sale waiting period requirement.--The term
''short sale waiting period requirement'' means any
underwriting or other requirement of the Federal National
Mortgage Association or the Federal Home Loan Mortgage
Corporation that requires, for the purchase by such Association
or Corporation of a mortgage under which the mortgagor is an
individual who was previously the mortgagor under another
mortgage that was sold in a short sale, that any minimum period
of time elapse after the occurrence of such short sale.
(c) Sunset.--The provisions of this section shall cease to be
effective on and after January 1, 2013.
A:
Responsible Homeowner Relief Act of 2010 - Amends the Internal Revenue Code to allow an individual taxpayer a deduction from gross income for loss from the sale or exchange of a principal residence in which such taxpayer resided for at least two years during the five-year period prior to the sale. Limits the aggregate amount of such deduction to $9,000, allowable in three annual installments of $3,000. Terminates such deduction after 2012.

Requires the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac) to waive any short sale waiting period requirement for certain mortgagors who refinance their mortgage in a short sale. Terminates such waiver authority on January 1, 2013.