[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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