Sec. 801. Renters tax credit
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Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: For purposes of section 38, in the case of a qualified credit recipient, the renters credit for any taxable year is an amount equal to the sum of the renters credit amounts allocated to such qualified credit recipient under this section for months ending during the taxable year. For purposes of this section, the term renters credit amount means the rent reduction amount with respect to each rental unit which is occupied by a qualified renter.
For purposes of this section, the term qualified renter means a family unit with income not greater than the higher of— 60 percent of local median income, or 150 percent of the Federal poverty line, in each case as determined by the Secretary of Housing and Urban Development for a family of the size involved. For purposes of this section— The term rent reduction amount is the amount by which the fair market rent for the unit involved exceeds the rent charged to the qualified renter.
The rent reduction amount taken into account under this section shall not exceed the excess of— the rent charged to the qualified renter (or, if lower, specified modest rent), over 30 percent of the qualified renters income (prorated monthly) as determined by the renters credit agency of the State. The term specified modest rent means— the Fair Market Rent determined by the Secretary of Housing and Urban Development for the ZIP code (if the unit is located in a metropolitan area) or non-metropolitan county, or such amount as may be determined by the State with respect to the area in which the unit is located if such amount is within 25 percent of the amount determined under clause
(i)with respect to such unit. The renters credit agency of the State may determine whether and how to take into account the cost of utilities in determining the rent reduction amount. The renters credit agency of the State may elect to increase the rent reduction amount such that such amount does not exceed 110 percent of such amount as determined without regard to this subparagraph. For purposes of this section, the term qualified credit recipient means, with respect to any rental unit occupied by a qualified renter, the owner of such unit but only to the extent of the renters credit amounts which have been allocated to such person by the renters credit agency. In lieu of the owner of the unit, the renters credit agency may treat the lender of any loan to such owner as the qualified credit recipient if such unit secures such loan. The renters credit agency may make allocations of renters credit amounts to qualified credit recipients under this section on the basis of— the identity of the qualified renter, such that the renters credit amount is allowed to the owner of any rental unit which such qualified renter occupies (or the lender referred to in subsection (c)) for any month, or one or more rental units, such that the renters credit amount is allowed to the owner of such units (or the lender referred to in subsection (c)) for such months as such units are occupied by a qualified renter. A renters credit agency may make allocations of renters credit as described in paragraph (1)(B) only if— such units are part of a project or building in which not more than 40 percent of the units receive allocations under this section (the Secretary may provide such exceptions to the requirement of this subparagraph as the Secretary determines appropriate for small buildings or buildings with respect to which more than 40 percent of the units were previously subsidized under other Federal programs), and the Secretary has approved a mobility plan submitted by such renters credit agency which provides for an adequate method to ensure that qualified renters have the ability to move from a unit which is eligible for credit under this section without losing the rent subsidy provided by this section. The aggregate credit amounts which a renters credit agency may allocate for any calendar year is the portion of the State renters credit ceiling allocated under this paragraph for such calendar year to such agency. Except as provided in subparagraphs
(D)and (E), the State renters credit ceiling for each calendar year shall be allocated to the renters credit agency of such State. If there is more than 1 renters credit agency of a State, all such agencies shall be treated as a single agency. The State renters credit ceiling applicable to any State and any calendar year shall be an amount equal to the sum of— the unused State renters credit ceiling (if any) of such State for the preceding calendar year, the greater of— $17.50 multiplied by the State population, or $20,000,000, the amount of State renters credit ceiling returned in the calendar year, plus the amount (if any) allocated under subparagraph
(D)to such State by the Secretary. For purposes of clause (i), the unused State renters credit ceiling for any calendar year is the excess (if any) of the sum of the amounts described in clauses
(ii)through
(iv)over the aggregate renters credit dollar amount allocated for such year. The unused renters credit carryover of a State for any calendar year shall be assigned to the Secretary for allocation among qualified States for the succeeding calendar year. For purposes of this subparagraph, the unused renters credit carryover of a State for any calendar year is the excess (if any) of— the unused State renters credit ceiling for the year preceding such year, over the aggregate renters credit dollar amount allocated for such year. The amount allocated under this subparagraph to a qualified State for any calendar year shall be the amount determined by the Secretary to bear the same ratio to the aggregate unused renters credit carryovers of all States for the preceding calendar year as such State's population for the calendar year bears to the population of all qualified States for the calendar year. For purposes of the preceding sentence, population shall be determined in accordance with section 146(j). For purposes of this subparagraph, the term qualified State means, with respect to a calendar year, any State— which allocated its entire State renters credit ceiling for the preceding calendar year, and for which a request is made (not later than May 1 of the calendar year) to receive an allocation under clause (iii). For purposes of this paragraph, rules similar to the rules of subparagraphs (E), (F), and
(G)of section 42(h)(3) shall apply. In the case of a calendar year after 2015, the $20,000,000 and $17.50 amounts in subparagraph
(C)shall each be increased by an amount equal to— such dollar amount, multiplied by the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting calendar year 2001 for calendar year 1992 in subparagraph
(B)thereof. In the case of the $20,000,000 amount, any increase under clause
(i)which is not a multiple of $50,000 shall be rounded to the next lowest multiple of $50,000. In the case of the $17.50 amount, any increase under clause
(i)which is not a multiple of 50 cents shall be rounded to the next lowest multiple of 50 cents. For purposes of this section— The term renters credit agency means, with respect to any State, the housing credit agency of such State (as defined in section 42(h)(8)(A)) or such other agency as is authorized to carry out the activities of the renters credit agency under this section. The term State includes a possession of the United States. The Secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section. . Subsection
(b)of section 38 of such Code is amended by striking plus at the end of paragraph (35), by striking the period at the end of paragraph
(36)and inserting , plus , and by adding at the end the following new paragraph: the renters credit determined under section 45S(a). . Subparagraph
(B)of section 38(c)(4) of such Code is amended by redesignating clauses
(vii)through
(ix)as clauses
(viii)through (x), respectively, and by inserting after clause
(vi)the following new clause: the credit determined under section 45S, . The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item: Sec. 45S. Renters credit. . The amendments made by this section shall apply to allocations made for calendar years after 2014 and to taxable years ending after December 31, 2014.