Sec. 215. First-time homebuyer refundable credit
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Section 36 of the Internal Revenue Code of 1986 is amended to read as follows: In the case of an individual who is a first-time homebuyer of a principal residence in the United States during a taxable year, there shall be allowed as a credit against the tax imposed by this subtitle for such taxable year an amount equal to 20 percent of the purchase price of the residence. The credit allowed under subsection
(a)shall not exceed $15,000. The amount allowable as a credit under subsection
(a)(determined without regard to this paragraph and paragraph (3), and after the application of paragraph (1)) for the taxable year shall be reduced (but not below zero) by the amount which bears the same ratio to the amount which is so allowable as— the excess (if any) of— the purchase price of the residence, over an amount equal to 110 percent of the conforming loan limit applicable to the residence, bears to $100,000. For purposes of the preceding sentence, the term conforming loan limit with respect to any residence means the applicable limitation governing the maximum original principal obligation for a mortgage secured by a residence of the same type, as determined and adjusted annually under section 302(b)(2) of the Federal National Mortgage Association Charter Act and section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act. The amount allowable as a credit under subsection
(a)(determined without regard to this paragraph and after the application of paragraphs
(1)and (2)) for the taxable year shall be reduced (but not below zero) by the amount which bears the same ratio to the amount which is so allowable as— the excess (if any) of— the taxpayer's modified adjusted gross income for the preceding taxable year, over the applicable threshold, bears to $50,000. For purposes of subparagraph (A), the term modified adjusted gross income with respect to any taxable year means the adjusted gross income of the taxpayer for such taxable year increased by any amount excluded from gross income under section 911, 931, or 933 for such taxable year. For purposes of subparagraph (A), the applicable threshold is— except as provided in clauses
(ii)and (iii), $100,000, an amount equal to 150 percent of the amount in effect under clause (i), in the case of a head of household (as defined in section 2(b)), and an amount equal to 200 percent of the amount in effect under clause (i), in the case of a joint return. No credit shall be allowed under subsection
(a)with respect to the purchase of any residence for a taxable year— if the taxpayer is a nonresident alien, or if— the taxpayer has not attained age 18 as of the date of such purchase, or a deduction under section 151 with respect to the taxpayer is allowable to another taxpayer for the taxable year. In the case of a taxpayer who is married, the taxpayer shall be treated as meeting the age requirement of subparagraph (B)(i) if the taxpayer or the taxpayer's spouse meets such age requirement. If 2 or more individuals who are not married purchase a principal residence, the amount of the credit under subsection
(a)shall be allocated among such individuals in such manner as the Secretary may prescribe by taking into account the requirements of paragraphs
(2)and (3), except that the total amount of the credits allowed to all such individuals shall not exceed the limitation under paragraph
(1)(as modified by paragraph (7)). If an individual is married at the close of the taxable year, the credit shall be allowed under subsection
(a)only if the individual and the individual's spouse file a joint return for the taxable year. In the case of any taxable year beginning after December 31, 2024, each of the dollar amounts in paragraphs (1), (2)(A)(ii), and (3)(C)(i) shall be increased by an amount equal to— such dollar amount, multiplied by the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting calendar year 2023 for calendar year 2016 in subparagraph (A)(ii) thereof. Any increase determined under the preceding sentence shall be rounded to the next lowest multiple of $50. For purposes of this section— The term first-time homebuyer means any individual who acquires a principal residence located in the United States by purchase if such individual (and, if married, such individual's spouse)— has not claimed any credit or deduction under this title for any previous taxable year with respect to the purchase or ownership of any residence or residential real estate (including for any expenditures relating to the placing in service of any property on, in connection with, or for use in such a residence or real estate), and attests under penalty of perjury that— the individual (and, if married, the individual's spouse) has not owned a principal residence at any time prior to the purchase of the principal residence to which this section applies, and the principal residence to which this section applies was not acquired from a person related to such individual or spouse. The Secretary may, in such manner as the Secretary may prescribe, waive the requirements of subparagraph
(A)for a taxable year in the case of an individual who is not eligible to file a joint return for the taxable year, and who was married at the time the individual or the individual's former spouse purchased a previous residence. The term principal residence has the same meaning as when used in section 121. The term purchase means any acquisition, but only if— the property is not acquired from a person related to the person acquiring such property (or, if either such person is married, such individual's spouse), and the basis of the property in the hands of the person acquiring such property is not determined— in whole or in part by reference to the adjusted basis of such property in the hands of the person from whom acquired, or under section 1014(a). A residence which is constructed by the taxpayer shall be treated as purchased by the taxpayer on the date the taxpayer first occupies such residence. The term purchase price means the adjusted basis (without regard to any reduction under section 1016(a)(38)) of the principal residence on the date such residence is purchased. A person shall be treated as related to another person if the relationship between such persons would result in the disallowance of losses under section 267 or 707(b) (but, in applying subsections
(b)and
(c)of section 267 for purposes of this section, paragraph
(4)of section 267(c) shall be treated as providing that the family of an individual shall include only the individual's spouse, ancestors, lineal descendants, and spouse's ancestors and lineal descendants). An individual's marital status shall be determined in accordance with section 7703. No credit under subsection
(a)shall be allowed to any taxpayer for any taxable year with respect to the purchase of a residence if the taxpayer disposes of such residence (or such residence ceases to be the principal residence of the taxpayer (and, if married, the taxpayer's spouse)) before the close of such taxable year. Except as provided in subparagraph (D), if the taxpayer disposes of the residence with respect to which a credit was allowed under subsection
(a)(or such residence ceases to be the principal residence of the taxpayer (and, if married, the taxpayer's spouse)) during the 5-taxable-year period beginning with the taxable year immediately following the credit year, the tax imposed by this chapter for the taxable year in which such disposal (or cessation) occurs shall be increased by an amount equal to the recapture percentage of the amount of the credit so allowed. For purposes of subparagraph (A), the term credit year means the taxable year in which the credit under subsection
(a)was allowed. For purposes of subparagraph (A), the recapture percentage with respect to any disposal or cessation described in such subparagraph shall be determined in accordance with the following table: If the disposal or The recapture cessation occurs in: percentage is: The 1st taxable year beginning after the credit year 100 percent The 2nd taxable year beginning after the credit year 80 percent The 3rd taxable year beginning after the credit year 60 percent The 4th taxable year beginning after the credit year 40 percent The 5th taxable year beginning after the credit year 20 percent. This paragraph shall not apply in the case of a disposal or cessation described in subparagraph
(A)which occurs after or incident to any of the following: Death of the taxpayer or the taxpayer's spouse. Divorce of the taxpayer. Involuntary conversion of the residence (within the meaning of section 121(d)(5)(A)). Relocation of duty station or qualified official extended duty (as defined in section 121(d)(9)(C)) of the taxpayer or the taxpayer's spouse who is a member of the uniformed services (as defined in section 121(d)(9)(C)(ii)), a member of the Foreign Service of the United States (as defined in section 121(d)(9)(C)(iii)), or an employee of the intelligence community (as defined in section 121(d)(9)(C)(iv)). Change of employment of the taxpayer or the taxpayer's spouse which meets the conditions of section 217(c). Loss of employment, health conditions, or such other unforeseen circumstances as may be specified by the Secretary. For purposes of this subtitle, if a credit is allowed under this section with respect to any property, the taxpayer's basis in such property shall be reduced by the amount of the credit so allowed. A credit shall be allowed under this section only if the following are included on the return of tax: The individual's (and, if married, the individual's spouse's) social security number issued by the Social Security Administration. The street address (not including a post office box) of the principal residence purchased. The purchase price of the principal residence. The date of purchase of the principal residence. The closing disclosure relating to the purchase (in the case of a purchase financed by a mortgage). If the Secretary requires information reporting under section 6045 by a person described in subsection (e)(2) thereof to verify the eligibility of taxpayers for the credit allowable by this section, the exception provided by section 6045(e)(5) shall not apply. . Subsection
(a)of section 1016 of the Internal Revenue Code of 1986, as amended by section 213, is further amended— by redesignating paragraphs
(38)and
(39)as paragraphs
(39)and (40), respectively; and by inserting after paragraph
(37)the following new paragraph: to the extent provided in section 36(e). . Section 26(b)(2) of the Internal Revenue Code of 1986 is amended by striking subparagraph
(W)and by redesignating subparagraphs (X), (Y), and
(Z)as subparagraphs (W), (X), and (Y), respectively. The item relating to section 36 in the table of sections for subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended to read as follows: Sec. 36. First-time homebuyer refundable credit. . Subparagraph
(N)of section 6213(g)(2) of the Internal Revenue Code of 1986 is amended to read as follows: in the case of a return claiming the credit under section 36— the omission of a social security number required under section 36(f)(1)(A), the inclusion of a social security number so required if— the claim of the credit on the return reflects the treatment of such individual as being of an age different from the individual's age based on such social security number, or except as provided in section 36(c)(1)(B), such social security number has been included (other than as a dependent for purposes of section 151) on a return for any previous taxable year claiming any credit or deduction described in section 36(c)(1)(A)(i), the omission of any other required information or documentation described in section 36(f)(1), including the inclusion of a post office box instead of a street address for the purchased residence, the inclusion of any information or documentation described in clause
(iii)if such information or documentation does not support a valid claim for the credit, or a claim of such credit for a taxable year with respect to the purchase of a residence made after the last day of such taxable year, . Notwithstanding the limitations on assessment and collection under section 6501 of the Internal Revenue Code of 1986, the Commissioner of Internal Revenue shall maintain records of returns and return information (as defined in section 6103(b)(2) of such Code) of any taxpayer claiming the credit under section 36 of such Code (as amended by this section) for the taxable year in which such credit is claimed and succeeding taxable years in the individual master files of the Internal Revenue Service. The amendments made by this section shall apply to taxable years beginning after December 31, 2023.