[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 2371 Introduced in Senate (IS)]
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118th CONGRESS
1st Session
S. 2371
To amend the Internal Revenue Code of 1986 to exclude from gross income
interest received on certain loans secured by rural or agricultural
real property.
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IN THE SENATE OF THE UNITED STATES
July 19, 2023
Mr. Moran (for himself and Mr. King) introduced the following bill;
which was read twice and referred to the Committee on Finance
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A BILL
To amend the Internal Revenue Code of 1986 to exclude from gross income
interest received on certain loans secured by rural or agricultural
real property.
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 ``Access to Credit for our Rural
Economy Act of 2023'' or as the ``ACRE Act of 2023''.
SEC. 2. EXCLUSION OF INTEREST ON LOANS SECURED BY RURAL OR AGRICULTURAL
REAL PROPERTY.
(a) In General.--Part III of subchapter B of chapter 1 of the
Internal Revenue Code of 1986 is amended by inserting after section
139I the following new section:
``SEC. 139J. INTEREST ON LOANS SECURED BY RURAL OR AGRICULTURAL REAL
PROPERTY.
``(a) In General.--Gross income shall not include interest received
by a qualified lender on any qualified real estate loan.
``(b) Qualified Lender.--For purposes of this section, the term
`qualified lender' means--
``(1) any bank or savings association the deposits of which
are insured under the Federal Deposit Insurance Act (12 U.S.C.
1811 et seq.), and
``(2) any entity wholly owned, directly or indirectly, by a
company that is treated as a bank holding company for purposes
of section 8 of the International Banking Act of 1978 (12
U.S.C. 3106) if--
``(A) such entity is organized, incorporated, or
established under the laws of the United States or any
State of the United States, and
``(B) the principal place of business of such
entity is in the United States.
``(c) Qualified Real Estate Loan.--For purposes of this section--
``(1) In general.--The term `qualified real estate loan'
means any loan--
``(A) secured by rural or agricultural real estate
or by a leasehold mortgage (with a status as a lien) on
rural or agricultural real estate, and
``(B) in the case of any loan with respect to
single family residence described in paragraph (2)(B)--
``(i) the proceeds of which are used to
purchase or improve such residence, and
``(ii) the principal of which (when added
to the principal of all other such loans with
respect to such residence) does not (as of the
time the interest income on such loan is
accrued) exceed $750,000.
For purposes of the preceding sentence, the determination of
whether property securing such loan is rural or agricultural
real estate shall be made as of the time the interest income on
such loan is accrued.
``(2) Rural or agricultural real estate.--The term `rural
or agricultural real estate' means--
``(A) any real property which is substantially used
for the production of one or more agricultural
products,
``(B) any single family residence--
``(i) which is the principal residence
(within the meaning of section 121) of its
occupant, and
``(ii) which is located in a rural area
within the meaning of section 1.11(b)(3) of the
Agricultural Credit Act of 1987 (12 U.S.C.
2019(b)(3)), and
``(C) any aquaculture facility.
``(3) Aquaculture facility.--The term `aquaculture
facility' means any land, structure, or other appurtenance that
is used for aquaculture (including any hatchery, rearing pond,
raceway, pen, or incubator) that is located in any State.
``(d) Coordination With Section 265.--Qualified real estate loans
shall be treated as obligations described in section 265(a)(2) the
interest on which is wholly exempt from the taxes imposed by this
subtitle.''.
(b) Clerical Amendment.--The table of sections for such part III is
amended by inserting after the item relating to section 139I the
following new item:
``Sec. 139J. Interest on loans secured by rural or agricultural real
property.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after the date of the enactment of
this Act.
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