,i #aaith ,,congress #ast ,session ,h4 ,r4 #fijj ,,in ,,the ,,house ,,of ,,representatives ,december #ah1 #bjbe,mr4 ,thompson of ,california 7for himself1 ,mr4 ,larson of ,connecticut1 ,mr4 ,davis of ,illinois1 ,ms4 ,snchez1 ,ms4 ,sewell1 ,ms4 ,del,bene1 ,ms4 ,chu1 ,ms4 ,moore of ,wisconsin1 ,mr4 ,boyle of ,pennsylvania1 ,mr4 ,beyer1 ,mr4 ,evans of ,pennsylvania1 ,mr4 ,schneider1 ,mr4 ,panetta1 ,mr4 ,gomez1 ,mr4 ,horsford1 ,ms4 ,plaskett1 ,mr4 ,suozzi1 ,mr4 ,bell1 ,ms4 ,craig1 ,ms4 ,de,lauro1 ,mr4 ,garamendi1 ,mr4 ,goldman of ,new ,york1 ,ms4 ,johnson of ,texas1 ,mr4 ,kennedy of ,new ,york1 ,ms4 ,matsui1 ,ms4 ,mc,bride1 ,ms4 ,mc,donald ,rivet1 ,mr4 ,mc,garvey1 ,mr4 ,mrvan1 ,mr4 ,quigley1 ,ms4 ,salinas1 ,ms4 ,titus1 and ,ms4 ,scholten7 introduced the following bill2 which was referred to the ,committee on ,ways and ,means1 and in addition to the ,committees on ,education and ,workforce1 and ,energy and ,commerce1 for a period to be subsequently determined by the ,speaker1 in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned ,a ,,bill ,to amend the ,internal ,revenue ,code of #aihf to address the nation's cost-of-living crisis4 #a4 ,short title2 etc 7a7 ,short title ,this ,act may be cited as the ,american ,affordability ,act of #bjbe4 7b7 ,amendment of #aihf code ,except as otherwise expressly provided1 whenever in this ,act an amendment is expressed in terms of an amendment to a section or other provision1 the reference shall be considered to be made to a section or other provision of the ,internal ,revenue ,code of #aihf4 7c7 ,table of contents ,the table of contents of this ,act is as follows3 ,sec4 #a4 ,short title2 etc4,title ,i--,housing and municipal infrastructure,subtitle ,a--,low-income housing credit,part #a--,reform of ,state allocation formulas,sec4 #aaaja4 ,increases in ,state allocations4,part #b--,reforms relating to tenant eligibility,sec4 #aabja4 ,average income test applicability to exempt facility bonds4,sec4 #aabjb4 ,codification of rules relating to increased tenant income4,sec4 #aabjc4 ,modification of student occupancy rules4,sec4 #aabjd4 ,tenant voucher payments taken into account as rent for certain purposes4,sec4 #aabje4 ,requirement that low-income housing credit-supported housing protect victims of domestic abuse4,sec4 #aabjf4 ,clarification of general public use requirement relating to veterans1 etc4,part #c--,rules relating to credit eligibility and determination,sec4 #aacja4 ,reconstruction or replacement period after casualty loss4,sec4 #aacjb4 ,modification of previous ownership rules2 limitation on acquisition basis4,sec4 #aacjc4 ,certain relocation costs taken into account as rehabilitation expenditures4,sec4 #aacjd4 ,repeal of qualified census tract population cap4,sec4 #aacje4 ,determination of community revitalization plan to be made by housing credit agency4,sec4 #aacjf4 ,prohibition of local approval and contribution requirements4,sec4 #aacjg4 ,increase in credit for certain projects designated to serve extremely low-income households4,sec4 #aacjh4 ,increase in credit for bond-financed projects designated by ,state agency4,sec4 #aacji4 ,elimination of basis reduction for low-income housing properties energy efficient commercial building deduction4,sec4 #aacaj4 ,restriction of planned foreclosures4,sec4 #aacaa4 ,increase of population cap for difficult development areas4,sec4 #aacab4 ,increased cost oversight and accountability4,part #d--,reforms relating to ,native ,american assistance,sec4 #aadja4 ,selection criteria under qualified allocation plans4,sec4 #aadjb4 ,inclusion of ,indian areas as difficult development areas for purposes of certain buildings4,part #e--,reforms relating to rural assistance,sec4 #aaeja4 ,inclusion of rural areas as difficult development areas4,sec4 #aaejb4 ,uniform income eligibility for rural projects4,part #f--;,exempt facility bonds,sec4 #aafja4 ,revision and clarification of the treatment of refunding issues4,part #g--,reforms relating to disabled veterans,sec4 #aagja4 ,treatment of veteran disability compensation or pension payments for purposes of low income housing tax credit and residential rental project bonds4,part #h--,reforms relating to certain other populations,sec4 #aahja4 ,additional housing credit allocations for certain populations who face unique barriers to affordable housing4,part #i--,qualified contracts and right of first refusal,sec4 #aaija4 ,repeal of qualified contract option4,sec4 #aaijb4 ,modification and clarification of rights relating to building purchase4,subtitle ,b--,additional housing incentives,sec4 #abjja4 ,investment credit for conversion of non-residential buildings to affordable housing4,sec4 #abjjb4 ,neighborhood homes credit4,sec4 #abjjc4 ,modification of historic rehabilitation tax credit4,sec4 #abjjd4 ,increase of exclusion of gain from sale of principal residence4,sec4 #abjje4 ,middle-income housing tax credit4,subtitle ,c--,affording the ,american dream,sec4 #acjja4 ,first-time homebuyer refundable tax credit4,sec4 #acjjb4 ,refundable credit for rent paid for principal residence4,title ,,ii--,lowering energy costs,subtitle ,a--,lowering costs through an all-of-the-above energy policy,sec4 #bajja4 ,clean energy production credit4,sec4 #bajjb4 ,clean electricity investment credit4,sec4 #bajjc4 ,advanced manufacturing production credit4,sec4 #bajjd4 ,repeal of restriction on the extension of advance energy project credit program4,sec4 #bajje4 ,reversion of construction date for clean hydrogen production credit4,sec4 #bajjf4 ,reversion of termination for residential clean energy credit4,sec4 #bajjg4 ,reinstatement of special rate for sustainable aviation fuel4,subtitle ,b--,lowering costs through energy efficiency,sec4 #bbjja4 ,energy efficient home improvement credit4,sec4 #bbjjb4 ,new energy efficient home credit4,sec4 #bbjjc4 ,repeal of termination of new energy efficient commercial buildings deduction4,sec4 #bbjjd4 ,restoration of cost recovery for energy property4,subtitle ,c--,lowering costs for electric vehicles and charging infrastructure,sec4 #bcjja4 ,reversion of termination date for previously-owned vehicle credit4,sec4 #bcjjb4 ,reversion of termination date for clean vehicle credit4,sec4 #bcjjc4 ,qualified commercial clean vehicles credit4,sec4 #bcjjd4 ,reversion of termination date for alternative fuel vehicle refueling property credit4,sec4 #bcjje4 ,credit for certain new electric bicycles4,subtitle ,d--,lowering costs of clean infrastructure and resiliency,sec4 #bdjja4 ,qualifying water reuse project credit4,sec4 #bdjjb4 ,recycling property investment credit4,sec4 #bdjjc4 ,exclusion of amounts received from ,state-based catastrophe loss mitigation programs4,sec4 #bdjjd4 ,exclusion from gross income of certain emergency agricultural assistance4,sec4 #bdjje4 ,credit for disaster mitigation expenditures4,sec4 #bdjjf4 ,establishment of electric power transmission line credit4,sec4 #bdjjg4 ,qualifying advanced battery project credit4,title ,,iii--,child and dependent care,subtitle ,a--,child tax credit,sec4 #cajja4 ,establishment of refundable child tax credit with monthly advance payment4,subtitle ,b--,child and dependent care,sec4 #cbjja4 ,enhancement of ,child and ,dependent ,care ,tax ,credit4,sec4 #cbjjb4 ,increased maximum contribution to dependent care assistance programs4,sec4 #cbjjc4 ,credit for working family caregivers4,sec4 #cbjjd4 ,licensed family child care credit4,subtitle ,c--,ensuring affordable adoptions,sec4 #ccjja4 ,refundable adoption tax credit4,title ,,iv--,education and workforce training,subtitle ,a--,ensuring affordable higher education,sec4 #dajja4 ,american opportunity credit expanded to #f years1 made temporarily fully refundable4,sec4 #dajjb4 ,expansion of ,pell ,grant exclusion from gross income4,sec4 #dajjc4 ,expansion of ,american ,opportunity and ,lifetime ,learning ,credits4,sec4 #dajjd4 ,elimination of denial of ,american ,opportunity ,tax ,credit for students convicted of a felony drug offense4,sec4 #dajje4 ,modification of treatment of student loan forgiveness4,sec4 #dajjf4 ,student loan interest deduction limitation applied separately to each spouse4,subtitle ,b--,supporting our workforce,sec4 #dbjja4 ,educator expense deduction to include early childhood educators4,sec4 #dbjjb4 ,allowance of deduction for certain expenses of the trade or business of being an employee4,sec4 #dbjjc4 ,modification of deduction for cash tips4,sec4 #dbjjd4 ,deduction for certain overtime compensation4,sec4 #dbjje4 ,above-the-line deduction of expenses of performing artists4,sec4 #dbjjf4 ,permanent extension of earned income credit rules for individuals without qualifying children4,sec4 #dbjjg4 ,application of earned income credit to possessions of the ,united ,states4,sec4 #dbjjh4 ,election to use prior year earned income for earned income tax credit4,title ,v--,healthcare,sec4 #ejjja4 ,increase in eligibility for health insurance premium assistance tax credit4,sec4 #ejjjb4 ,filling the coverage gap4,sec4 #ejjjc4 ,freeze of premium adjustment percentage increase4,sec4 #ejjjd4 ,requiring coverage of certain immunizations recommended by the ,advisory ,committee on ,immunization ,practices4 ,i ,housing and municipal infrastructure ,a ,low-income housing credit #a ,reform of ,state allocation formulas #aaaja4 ,increases in ,state allocations 7a7 ,in general ,clause 7ii7 of section #db7;h77#c77;,c7 of the ,internal ,revenue ,code of #aihf is amended-- 7#a7 in subclause 7,i71 by striking #a4ge and inserting the per capita amount1 and 7#b7 in subclause 7,,ii71 by striking #b1jjj1jjj and inserting the minimum amount4 7b7 ,per capita amount2 minimum amount ,section #db7;h77#c7 of the ,internal ,revenue ,code of #aihf is amended by striking subparagraphs 7,h7 and 7,i7 and inserting the following3 7,h7 ,per capita amount ,for purposes of subparagraph 7,c77ii77,i71 the per capita amount shall be determined as follows3 7i7 ,calendar year #bjbf ,for calendar year #bjbf1 the per capita amount is #d4be4 7ii7 ,calendar year #bjbg ,for calendar year #bjbg1 the per capita amount is the product of-- 7,i7 #a4be1 and 7,,ii7 the dollar amount under clause 7i7 increased by an amount equal to-- 7aa7 such dollar amount1 multiplied by 7bb7 the cost-of-living adjustment determined under section #a7;f77#c7 for such calendar year1 determined by substituting calendar year #bjbe for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 ,if the amount determined after application of the preceding sentence is not a multiple of #e1jjj1 such amount shall be rounded to the next lowest multiple of #e1jjj4 7iii7 ,calendar years after #bjbg ,in the case of any calendar year after #bjbg1 the per capita amount is the dollar amount determined under clause 7ii7 increased by an amount equal to-- 7,i7 such dollar amount1 multiplied by 7,,ii7 the cost-of-living adjustment determined under section #a7;f77#c7 for such calendar year1 determined by substituting calendar year #bjbf for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 ,any amount increased under the preceding sentence which is not a multiple of #e cents shall be rounded to the next lowest multiple of #e cents4 7,i7 ,minimum amount ,for purposes of subparagraph 7,c77ii77,,ii71 the minimum amount shall be determined as follows3 7i7 ,calendar year #bjbf ,for calendar year #bjbf1 the minimum amount is #d1hgf1jjj4 7ii7 ,calendar year #bjbg ,for calendar year #bjbg1 the minimum amount is the product of-- 7,i7 #a4be1 and 7,,ii7 the dollar amount under clause 7i7 increased by an amount equal to-- 7aa7 such dollar amount1 multiplied by 7bb7 the cost-of-living adjustment determined under section #a7;f77#c7 for such calendar year1 determined by substituting calendar year #bjbe for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 ,if the amount determined after application of the preceding sentence is not a multiple of #e cents1 such amount shall be rounded to the next lowest multiple of #e cents4 7iii7 ,calendar years after #bjbg ,in the case of any calendar year after #bjbg1 the minimum amount is the dollar amount determined under clause 7ii7 increased by an amount equal to-- 7,i7 such dollar amount1 multiplied by 7,,ii7 the cost-of-living adjustment determined under section #a7;f77#c7 for such calendar year1 determined by substituting calendar year #bjbf for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 ,any amount increased under the preceding sentence which is not a multiple of #e1jjj shall be rounded to the next lowest multiple of #e1jjj4 4 7c7 ,effective date ,the amendments made by this section shall apply to calendar years beginning after ,december #ca1 #bjbe4 #b ,reforms relating to tenant eligibility #aabja4 ,average income test applicability to exempt facility bonds 7a7 ,in general ,paragraph 7#a7 of section #adb7;d7 is amended-- 7#a7 by striking 7,a7 or 7,b7 and inserting 7,a71 7,b71 or 7,c71 and 7#b7 by inserting after subparagraph 7,b7 the following new subparagraph3 7,c7 ,average income test ,a project meets the requirements of this subparagraph if it meets the minimum requirements of section #db7;g77#a77;,c74 4 7b7 ,effective date ,the amendments made by this section shall apply to elections made under section #adb7;d77#a7 of the ,internal ,revenue ,code of #aihf after ,march #bc1 #bjah4 #aabjb4 ,codification of rules relating to increased tenant income 7a7 ,in general ,clause 7i7 of section #db7;g77#b77;,d7 is amended by striking clauses 7ii71 7iii71 and 7iv7 and all that follows and inserting 8clauses 7ii71 7iii71 7iv71 and 7vi71 notwithstanding an increase in the income of the occupants above the income limitation applicable under paragraph 7#a7-- 7,i7 a low-income unit shall continue to be treated as a low-income unit if the income of such occupants initially was #fj percent or less of area median gross income and such unit continues to be rent-restricted1 and 7,,ii7 a unit to which1 at the time of initial occupancy by such occupants1 any ,federal1 ,state1 or local government income restriction applied1 and which subsequently becomes part of a building with respect to which rehabilitation expenditures are taken into account under subsection 7e71 shall be treated as a low-income unit if the income of such occupants initially was #fj percent or less of area median gross income and does not exceed #abj percent of area median gross income as of the date of acquisition of the property by the taxpayer4 4 7b7 ,exception ,subparagraph 7,d7 of section #db7;g77#b7 is amended by adding at the end the following new clause3 7vi7 ,exception to rule relating to increased tenant income ,in the case of an occupant of a low-income unit who initially qualified to occupy such unit by reason of paragraph 7#a77;,c7 with an income in excess of #fj percent of area median gross income but not in excess of #hj percent of area median gross income1 clause 7i7 shall be applied for substituting #hj percent for #fj percent each place it appears4 4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #aabjc4 ,modification of student occupancy rules 7a7 ,in ,general ,subparagraph 7,d7 of section #db7;i77#c7 is amended to read as follows3 7,d7 ,rules relating to students 7i7 ,in general ,a unit occupied solely by individuals who-- 7,i7 have not attained age #bd1 and 7,,ii7 are enrolled in a full-time course of study at an institution of higher education 7as defined in section #ccjd7;f771 shall not be treated as a low-income unit4 7ii7 ,exception for certain ,federal programs ,in the case of a federally-assisted building 7as defined in subsection 7d77#f77;,c77i771 clause 7i7 shall not apply to a unit all of the occupants of which meet all applicable requirements under the housing program described in such subsection through which the building is assisted1 financed1 or operated4 7iii7 ,other exceptions ,an individual shall not be treated as described in clause 7i7 if the individual meets the income limitation applicable under subsection 7g77#a7 to the project of which the building is a part and-- 7,i7 is married1 7,,ii7 is a person with disabilities 7as defined in section #c7;b77#c77;,e7 of the ,united ,states ,housing ,act of #aicg71 7,,iii7 is a veteran 7as defined in section #aja7b7 of title #ch1 ,united ,states ,code71 7,,iv7 has #a or more qualifying children 7as defined in section #aeb7;c771 7,v7 is or has been a victim or threatened victim of domestic violence1 dating violence1 sexual assault1 or stalking 7as defined in section #djjjb of the ,violence ,against ,women ,act of #aiid71 7,,vi7 is or has been a victim of any form of human trafficking1 or 7,,vii7 is1 or was prior to attaining the age of majority-- 7aa7 an emancipated minor or in legal guardianship as determined by a court of competent jurisdiction in the individual's ,state of legal residence1 7bb7 under the care and placement responsibility of the ,state agency responsible for administering a plan under part ,b or part ,e of title ,,iv of the ,social ,security ,act1 or 7cc7 an unaccompanied youth 7within the meaning of section #gbe7f7 of the ,mc,kinney-,vento ,homeless ,assistance ,act 7#db ,u4,s4,c4 #aadcd;a7#f777 or a homeless child or youth 7within the meaning of section #gbe7b7 of such ,act 7#db ,u4,s4,c4 #aadcd;a7#b7774 ,for purposes of subclause 7,,vi71 an individual is or has been a victim of human trafficking if such individual was subjected to an act or practice described in paragraph 7#aa7 or 7#ab7 of section #ajc of the ,trafficking ,victims ,protection ,act of #bjjj4 4 7b7 ,effective date ,the amendment made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #aabjd4 ,tenant voucher payments taken into account as rent for certain purposes 7a7 ,in general ,subparagraph 7,b7 of section #db7;g77#b7 is amended by adding at the end the following new sentence3 ,in the case of a project with respect to which the taxpayer elects the requirements of subparagraph 7,c7 of paragraph 7#a71 or the portion of a project to which subsection 7d77#e77;,c7 applies1 clause 7i7 shall not apply with respect to any tenant-based assistance 7as defined in section #h7;f77#g7 of the ,united ,states ,housing ,act of #aicg 7#db ,u4,s4,c4 #adcg;f7f77#g77744 7b7 ,effective date ,the amendments made by this section shall apply to rent paid in taxable years beginning after ,december #ca1 #bjbe4 #aabje4 ,requirement that low-income housing credit-supported housing protect victims of domestic abuse 7a7 ,in general ,subparagraph 7,b7 of section #db7;h77#f7 is amended by striking and at the end of clause 7v71 by striking the period at the end of clause 7vi7 and inserting 1 and1 and by adding at the end the following new clause3 7vii7 which-- 7,i7 prohibits the refusal to lease to1 or termination of a lease by1 a person solely on the basis of criminal activity directly relating to domestic violence1 dating violence1 sexual assault1 or stalking that is engaged in by a member of the household of the tenant or any guest or other person under the control of the tenant1 if the tenant or an affiliated individual of the tenant is the victim or threatened victim of such domestic violence1 dating violence1 sexual assault1 or stalking1 and 7,,ii7 allows prospective1 present1 or former occupants of the building the right to enforce in any ,state court the prohibition of subclause 7,i74 4 7b7 ,bifurcation 7#a7 ,in general ,subparagraph 7,b7 of section #db7;h77#f71 as amended by subsection 7a71 is further amended by adding at the end the following new flush sentence3 ,for purposes of clause 7vii77,i71 rules similar to the rules of section #dadaa7;b77#c77;,b7 of the ,violence ,against ,women ,act of #aiid shall apply with respect to the owner or manager of a building4 4 7#b7 ,effect of bifurcation ,paragraph 7#b7 of section #db7;g7 is amended by adding at the end the following new subparagraph3 7,f7 ,treatment of bifurcation in cases of domestic violence ,in any case in which-- 7i7 an occupant is evicted or removed from a low-income unit because such occupant has engaged in criminal activity directly relating to domestic violence1 dating violence1 sexual assault1 or stalking against an affiliated individual or other individual on the basis of criminal activity directly relating to domestic violence1 dating violence1 sexual assault1 or stalking1 and 7ii7 the lease on such unit is bifurcated as provided in the last sentence of subsection 7h77#f77;,b71 then the remaining occupants of such low-income unit shall not be treated as a new tenant for purposes of this section4 4 7c7 ,clarification of general public use requirement ,paragraph 7#i7 of section #db7;g7 is amended by striking or at the end of subparagraph 7,b71 by striking the period at the end of subparagraph 7,c7 and inserting 1 or1 and by adding at the end the following new subparagraph3 7,d7 who are victims or threatened victims of criminal activity directly relating to domestic violence1 dating violence1 sexual assault1 or stalking4 4 7d7 ,effective dates 7#a7 ,in general ,except as provided in paragraph 7#b71 the amendments made by this section shall apply to agreements executed or modified on or after the date that is #cj days after the date of the enactment of this ,act4 7#b7 ,public use requirement ,the amendments made by subsection 7c7 shall apply to buildings placed in service before1 on1 or after the date of the enactment of this ,act4 #aabjf4 ,clarification of general public use requirement relating to veterans1 etc 7a7 ,in general ,paragraph 7#i7 of section #db7;g71 as amended by section #aabje1 is further amended by adding at the end the following flush language3 ,any veteran of the ,armed ,forces shall be treated as a member of a specified group under a ,federal program for purposes of subparagraph 7,b74 4 7b7 ,qualified residential rental projects ,paragraph 7#b7 of section #adb7;d7 is amended by adding at the end the following new subparagraph3 7,f7 ,clarification of general public use requirement ,a unit shall not fail to meet the general public use requirement solely because of occupancy restrictions or preferences1 if such restrictions or preferences meet the general public use requirement of section #db4 4 7c7 ,effective dates 7#a7 ,in general ,the amendment made by subsection 7a7 shall apply to buildings placed in service before1 on1 or after the date of the enactment of this ,act4 7#b7 ,qualified residential rental projects ,the amendment made by subsection 7b7 shall apply to bonds issued before1 on1 or after the date of the enactment of this ,act4 #c ,rules relating to credit eligibility and determination #aacja4 ,reconstruction or replacement period after casualty loss 7a7 ,no recapture following casualty loss ,subparagraph 7,e7 of section #db7;j77#d7 is amended to read as follows3 7,e7 ,no recapture by reason of casualty loss 7i7 ,in general ,the increase in tax under this subsection shall not apply to a reduction in qualified basis by reason of a casualty loss to the extent such loss is restored by reconstruction or replacement within a reasonable period established by the applicable housing credit agency1 not to exceed #be months from the date on which the qualified casualty loss arises4 7ii7 ,qualified casualty losses ,in the case of a qualified casualty loss1 the period described in clause 7i7 may be extended1 but not in excess of #ab months1 if the applicable housing credit agency determines the qualified casualty arose by reason of an event which was not discrete to the building and which made a reconstruction or replacement within #be months impractical4 ,in the event the applicable housing credit agency determines a period in excess of #be months is necessary for such reconstruction or replacement1 the compliance period shall be increased by any such additional time4 7iii7 ,application ,the determination under paragraph 7#a7 shall not be made with respect to a property the basis of which is affected by a qualified casualty loss until the period described in clause 7i7 7as modified by clause 7ii71 if applicable7 with respect to such property has expired4 7iv7 ,qualified casualty loss ,for purposes of this subparagraph1 the term qualified casualty loss means a casualty loss that is the result of a federally declared disaster 7as defined in section #afe7;i77#e774 4 7b7 ,qualified basis following casualty loss ,paragraph 7#a7 of section #db7;c7 is amended by adding at the end the following new subparagraph3 7,f7 ,qualified basis following casualty loss ,if a casualty causes the qualified basis of a building in any year to be less than the qualified basis in the immediately preceding year then1 in the year of such casualty and each succeeding year until such building or the units affected by the casualty are reconstructed or replaced 7but only through the last year of the period permitted for reconstruction or replacement under subsection 7j77#d77;,e77-- 7i7 the qualified basis of such building shall be equal to the qualified basis of such building as of the last day of the year preceding the year in which such casualty occurred1 7ii7 if such building is not reconstructed or replaced by the expiration of the applicable period for such reconstruction or replacement under subsection 7j77#d71 then the recapture amount provided for in subsection 7j77#a7 shall include the amount of any credit claimed under this section by reason of the application of clause 7i71 and 7iii7 a building which was a qualified low-income building as of the last day of the year preceding the year in which such casualty occurred shall not cease to be a qualified low-income building solely because of such casualty4 4 7c7 ,effective date ,the amendments made by this section shall apply to casualties occurring after ,december #ca1 #bjbe4 #aacjb4 ,modification of previous ownership rules2 limitation on acquisition basis 7a7 ,in general ,clause 7ii7 of section #db7;d77#b77;,b7 is amended by inserting 1 or the taxpayer elects the application of subparagraph 7,c77ii7 after service4 7b7 ,limitation on acquisition basis ,subparagraph 7,c7 of section #db7;d77#b7 is amended-- 7#a7 by striking ,for purposes of subparagraph 7,a71 the adjusted basis and inserting 8,for purposes of subparagraph 7,a7-- 7i7 ,in general ,the adjusted basis 1 and 7#b7 by adding at the end the following new clauses3 7ii7 ,buildings in service within previous #aj years ,if the period between the date of acquisition of the building by the taxpayer and the date the building was last placed in service is less than #aj years1 the taxpayer's basis attributable to the acquisition of the building which is taken into account in determining the adjusted basis shall not exceed the sum of-- 7,i7 the lowest amount paid for acquisition of the building by any person during the #aj years preceding the date of the acquisition of the building by the taxpayer1 adjusted as provided in clause 7iii71 and 7,,ii7 the value of any capital improvements made by the person who sells the building to the taxpayer which are reflected in such seller's basis4 7iii7 ,adjustment ,with respect to a basis determination made in any taxable year1 the amount described in clause 7ii77,i7 shall be increased by an amount equal to-- 7,i7 such amount1 multiplied by 7,,ii7 a cost-of-living adjustment1 determined in the same manner as under section #a7;f77#c7 for the calendar year in which the taxable year begins by taking into account the acquisition year in lieu of calendar year #aiib4 ,for purposes of the preceding sentence1 the acquisition year is the calendar year in which the lowest amount referenced in clause 7ii77,i7 was paid for the acquisition of the building4 4 7c7 ,conforming amendments ,clause 7i7 of section #db7;d77#b77;,d7 is amended-- 7#a7 by striking for subparagraph 7,b7 in the heading1 and 7#b7 by striking subparagraph 7,b77ii7 in the matter preceding subclause 7,i7 and inserting subparagraph 7,b77ii7 or 7,c77ii74 7d7 ,modification of placed in service rule ,clause 7iii7 of section #db7;d77#b77;,b7 is amended to read as follows3 7iii7 the building was not owned by the taxpayer or by any person related 7as of the date of acquisition by the taxpayer7 to the taxpayer at any time during the #e-year period ending on the date of acquisition by the taxpayer1 and 4 7e7 ,effective date ,the amendments made by this section shall apply to buildings placed in service after ,december #ca1 #bjbe4 #aacjc4 ,certain relocation costs taken into account as rehabilitation expenditures 7a7 ,in general ,paragraph 7#b7 of section #db7;e7 is amended by adding at the end the following new subparagraph3 7,c7 ,certain relocation costs ,in the case of a rehabilitation of a building to which section #bhj;,b does not apply1 costs relating to the relocation of occupants1 including-- 7i7 amounts paid to occupants1 7ii7 amounts paid to third parties for services relating to such relocation1 and 7iii7 amounts paid for temporary housing for occupants1 shall be treated as chargeable to capital account and taken into account as rehabilitation expenditures4 4 7b7 ,effective date ,the amendment made by this section shall apply to expenditures paid or incurred after ,december #ca1 #bjbe4 7c7 ,no inference ,nothing in the amendment made by this section shall be construed to create any inference with respect to the treatment of relocation costs paid or incurred before ,january #a1 #bjbf4 #aacjd4 ,repeal of qualified census tract population cap 7a7 ,in general ,clause 7ii7 of section #db7;d77#e77;,b7 is amended-- 7#a7 by striking subclauses 7,,ii7 and 7,,iii71 and 7#b7 by striking 8,qualified census tract4-- 7,i7 ,in general ,the term 1 and inserting ,qualified census tract4--,the term4 7b7 ,effective date ,the amendments made by this section shall apply to designations of qualified census tracts under section #db7;d77#e77;,b77ii7 of the ,internal ,revenue ,code of #aihf after ,december #ca1 #bjbe4 #aacje4 ,determination of community revitalization plan to be made by housing credit agency 7a7 ,in general ,subclause 7,,iii7 of section #db7m77#a77;,b77ii7 is amended by inserting 1 as determined by the housing credit agency according to criteria established by such agency1 after 7d77#e77;,b77ii77 and4 7b7 ,criteria ,paragraph 7#a7 of section #db7m7 is amended by adding at the end the following new subparagraph3 7,e7 ,criteria for determination relating to concerted community revitalization plan ,for purposes of subparagraph 7,b77ii77,,iii71 the criteria which shall be established by a housing credit agency for determining whether the development of a project contributes to a concerted community development plan shall take into account any factors the agency deems appropriate1 including the extent to which the proposed plan-- 7i7 is geographically specific1 7ii7 outlines a clear plan for implementation and goals for outcomes1 7iii7 includes a strategy for applying for or obtaining commitments of public or private investment 7or both7 in nonhousing infrastructure1 amenities1 or services1 and 7iv7 demonstrates the need for community revitalization4 4 7c7 ,effective date ,the amendments made by this section shall apply to allocations of housing credit dollar amounts made under qualified allocation plans 7as defined in section #db7m77#a77;,b7 of the ,internal ,revenue ,code of #aihf7 adopted after ,december #ca1 #bjbe4 #aacjf4 ,prohibition of local approval and contribution requirements 7a7 ,in general ,paragraph 7#a7 of section #db7m71 as amended by section #aacje1 is further amended-- 7#a7 by striking clause 7ii7 of subparagraph 7,a7 and by redesignating clauses 7iii7 and 7iv7 thereof as clauses 7ii7 and 7iii71 and 7#b7 by adding at the end the following new subparagraph3 7,f7 ,local approval or contribution not taken into account ,the selection criteria under a qualified allocation plan shall not include consideration of-- 7i7 any support or opposition with respect to the project from local or elected officials1 or 7ii7 any local government contribution to the project1 except to the extent such contribution is taken into account as part of a broader consideration of the project's ability to leverage outside funding sources1 and is not prioritized over any other source of outside funding4 4 7b7 ,effective date ,the amendments made by this section shall apply to allocations of housing credit dollar amounts made under qualified allocation plans 7as defined in section #db7m77#a77;,b7 of the ,internal ,revenue ,code of #aihf7 adopted after ,december #ca1 #bjbe4 #aacjg4 ,increase in credit for certain projects designated to serve extremely low-income households 7a7 ,in general ,paragraph 7#e7 of section #db7;d7 is amended by adding at the end the following new subparagraph3 7,c7 ,increase in credit for projects designated to serve extremely low-income households ,in the case of any building-- 7i7 #bj percent or more of the residential units 7determined as if the imputed income limitation applicable to such units were #cj percent of area median gross income7 in which are designated by the taxpayer for occupancy by households the aggregate household income of which does not exceed the greater of-- 7,i7 #cj percent of area median gross income1 or 7,,ii7 #ajj percent of an amount equal to the ,federal poverty line 7within the meaning of section #cf;,b7d77#c771 and 7ii7 which is designated by the housing credit agency as requiring the increase in credit under this subparagraph in order for such building to be financially feasible as part of a qualified low-income housing project1 subparagraph 7,b7 shall not apply to the portion of such building which is comprised of such units 7determined in a manner similar to the unit fraction under subsection 7c77#a77;,c771 and the eligible basis of such portion of the building shall be #aej percent of such basis determined without regard to this subparagraph4 4 7b7 ,effective date ,the amendment made by this section shall apply to buildings which receive allocations of housing credit dollar amount after the date of enactment of this ,act1 or in the case of buildings that are described in section #db7;h77#d77;,b7 of the ,internal ,revenue ,code of #aihf1 for obligations that are part of an issue the issue date of which is after ,december #ca1 #bjbe4 #aacjh4 ,increase in credit for bond-financed projects designated by ,state agency 7a7 ,in general ,clause 7v7 of section #db7;d77#e77;,b7 is amended by striking the second sentence4 7b7 ,technical amendment ,clause 7v7 of section #db7;d77#e77;,b71 as amended by subsection 7a71 is further amended-- 7#a7 by striking ,state in the heading1 and 7#b7 by striking ,state housing credit agency and inserting housing credit agency4 7c7 ,effective date ,the amendments made by this section shall apply to buildings that are described in section #db7;h77#d77;,b7 of the ,internal ,revenue ,code of #aihf1 taking into account only obligations that are part of an issue the issue date of which is after ,december #ca1 #bjbe4 #aacji4 ,elimination of basis reduction for low-income housing properties energy efficient commercial building deduction 7a7 ,energy efficient commercial buildings deduction ,subsection 7e7 of section #agi;,d is amended-- 7#a7 by striking reduction4--,for purposes and inserting 8reduction4-- 7#a7 ,in general ,for purposes 1 and 7#b7 by adding at the end the following new paragraph3 7#b7 ,exception for affordable housing properties ,paragraph 7#a7 shall not apply for purposes of determining eligible basis under section #db4 4 7b7 ,effective date ,the amendments made by this section shall apply to buildings which receive allocations of housing credit dollar amount after the date of the enactment of this ,act and to buildings that are described in section #db7;h77#d77;,b7 of the ,internal ,revenue ,code of #aihf taking into account only obligations that are part of an issue the issue date of which is after ,december #ca1 #bjbe4 #aacaj4 ,restriction of planned foreclosures 7a7 ,in general ,subclause 7,i7 of section #db7;h77#f77;,e77i7 is amended to read as follows3 7,i7 on the #fast day after the taxpayer 7or a successor in interest7 provides notice to the ,secretary and the housing credit agency that the building has been acquired by foreclosure 7or instrument in lieu of foreclosure7 and that the taxpayer intends the termination of such period1 unless1 before such date1 the ,secretary or the housing credit agency determines that such acquisition is part of an arrangement with the taxpayer a purpose of which is to terminate such period1 or 4 7b7 ,conforming amendment ,the second sentence of clause 7i7 of section #db7;h77#f77;,e7 is amended by striking ,subclause 7,,ii7 and inserting ,subclauses 7,i7 and 7,,ii74 7c7 ,effective date ,the amendments made by this section shall apply to acquisitions by foreclosure 7or instrument in lieu of foreclosure7 after ,december #ca1 #bjbe4 #aacaa4 ,increase of population cap for difficult development areas 7a7 ,in general ,subclause 7,,ii7 of section #db7;d77#e77;,b77iii7 is amended by striking #bj percent and inserting #cj percent4 7b7 ,effective date ,the amendment made by this section shall apply to designations made under section #db7;d77#e77;,b77iii7 of the ,internal ,revenue ,code of #aihf after ,december #ca1 #bjbe4 #aacab4 ,increased cost oversight and accountability 7a7 ,in general ,subparagraph 7,c7 of section #db7m77#a7 is amended by striking and at the end of clause 7ix71 by striking the period at the end of clause 7x7 and inserting 1 and1 and by adding at the end the following new clause3 7xi7 the reasonableness of the development costs of the project4 4 7b7 ,effective date ,the amendments made by this section shall apply to allocations of credits under section #db of the ,internal ,revenue ,code of #aihf made after ,december #ca1 #bjbe4 #d ,reforms relating to ,native ,american assistance #aadja4 ,selection criteria under qualified allocation plans 7a7 ,in general ,subparagraph 7,c7 of section #db7m77#a71 as amended by section #aacab1 is further amended by striking and at the end of clause 7x71 by striking the period at the end of clause 7xi7 and inserting 1 and1 and by adding at the end the following new clause3 7xii7 the affordable housing needs of individuals in the ,state who are-- 7,i7 enrolled members of a tribe with respect to an ,indian tribal government 7including any agencies or instrumentalities of an ,indian tribal government and any ,alaska ,native regional or village corporation1 as defined in1 or established pursuant to1 the ,alaska ,native ,claims ,settlement ,act 7#dc ,u4,s4,c4 #afja et seq4771 or 7,,ii7 described in section #hja7i7 of the ,native ,american ,housing ,assistance and ,self-,determination ,act of #aiif 7#be ,u4,s4,c4 #dbba7i774 4 7b7 ,effective date ,the amendments made by this section shall apply to allocations of credits under section #db of the ,internal ,revenue ,code of #aihf made after ,december #ca1 #bjbe4 #aadjb4 ,inclusion of ,indian areas as difficult development areas for purposes of certain buildings 7a7 ,in general ,subclause 7,i7 of section #db7;d77#e77;,b77iii7 is amended by inserting before the period the following3 1 and any ,indian area4 7b7 ,indian area ,clause 7iii7 of section #db7;d77#e77;,b7 is amended by redesignating subclause 7,,ii7 as subclause 7,,iii7 and by inserting after subclause 7,i7 the following new subclause3 7,,ii7 ,indian area ,for purposes of subclause 7,i71 the term ,indian area means any ,indian area 7as defined in section #d7aa7 of the ,native ,american ,housing ,assistance and ,self ,determination ,act of #aiif 7#be ,u4,s4,c4 #dajc7aa777 and any housing area 7as defined in section #hja7e7 of such ,act 7#be ,u4,s4,c4 #dbba7e7774 4 7c7 ,eligible buildings ,clause 7iii7 of section #db7;d77#e77;,b71 as amended by subsection 7b71 is further amended by adding at the end the following new subclause3 7,,iv7 ,special rule for buildings in ,indian areas ,in the case of an area which is a difficult development area solely because it is an ,indian area1 a building shall not be treated as located in such area unless such building is assisted or financed under the ,native ,american ,housing ,assistance and ,self ,determination ,act of #aiif 7#be ,u4,s4,c4 #daja et seq47 or the project sponsor is an ,indian tribe 7as defined in section #de;,a7c77#f771 a tribally designated housing entity 7as defined in section #d7bb7 of such ,act 7#be ,u4,s4,c4 #dajc7bb7771 or wholly owned or controlled by such an ,indian tribe or tribally designated housing entity4 4 7d7 ,effective date ,the amendments made by this section shall apply to buildings placed in service after ,december #ca1 #bjbe4 #e ,reforms relating to rural assistance #aaeja4 ,inclusion of rural areas as difficult development areas 7a7 ,in general ,subclause 7,i7 of section #db7;d77#e77;,b77iii71 as amended by section #aadjb1 is further amended by inserting 1 any rural area after median gross income4 7b7 ,rural area ,clause 7iii7 of section #db7;d77#e77;,b71 as amended by section #aadjb1 is further amended by redesignating subclause 7,,iii7 as subclause 7,,iv7 and by inserting after subclause 7,,ii7 the following new subclause3 7,,iii7 ,rural area ,for purposes of subclause 7,i71 the term rural area means any non-metropolitan area1 or any rural area as defined by section #ebj of the ,housing ,act of #aidi1 which is identified by the qualified allocation plan under subsection 7m77#a77;,b74 4 7c7 ,effective date ,the amendments made by this section shall apply to buildings placed in service after ,december #ca1 #bjbe4 #aaejb4 ,uniform income eligibility for rural projects 7a7 ,in general ,paragraph 7#h7 of section #db7;i7 is amended by striking the second sentence4 7b7 ,effective date ,the amendment made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #f ,exempt facility bonds #aafja4 ,revision and clarification of the treatment of refunding issues 7a7 ,in general ,subparagraph 7,a7 of section #adf7;i77#f7 is amended to read as follows3 7,a7 ,in general ,during the #ab-month period beginning on the date of a repayment of a loan financed by an issue #ie percent or more of the net proceeds of which are used to provide projects described in section #adb7;d71 if such repayment is used to provide a new loan for any project described in section #adb7;a77#g7 or for any purpose described in subsection 7a77#b77;,a7 or 7b7 of section #adc1 any bond which is issued to refinance such issue shall be treated as a refunding issue4 ,any issue treated as a refunding issue by reason of the preceding sentence shall be so treated only to the extent the principal amount of such refunding issue does not exceed the principal amount of the bonds refunded4 4 7b7 ,removal of one-,refunding limit ,subparagraph 7,b7 of section #adf7;i77#f7 is amended-- 7#a7 by striking #d years in clause 7i7 and inserting #aj years1 7#b7 by striking was issued in clause 7ii7 and inserting is issued1 7#c7 by redesignating clauses 7i7 7as so amended71 7ii7 7as so amended71 and 7iii7 as subclauses 7,i71 7,,ii71 and 7,,iii71 respectively1 and by moving such subclauses #b ems to the right1 7#d7 by striking ,limitations4--,subparagraph 7,a7 shall apply to only one refunding of the original issue and and inserting 8,limitations4-- 7i7 ,in general ,subparagraph 7,a7 shall apply to a bond 1 and 7#e7 by adding at the end the following new clause3 7ii7 ,source of loan repayment ,subparagraph 7,a7 shall not apply to any repayment of a loan which is-- 7,i7 made by a repayment of another loan1 or 7,,ii7 financed by an issue treated as a refunding issue under subparagraph 7,a74 4 7c7 ,conforming amendment ,the heading of paragraph 7#f7 of section #adf7;i7 is amended by striking residential rental project bonds as refunding bonds irrespective of obligor and inserting bonds as refunding bonds4 7d7 ,effective dates 7#a7 ,in general ,the amendments made by subsections 7a7 and 7c7 shall apply to refunding issues described in section #adf7;i77#f77;,a7 of the ,internal ,revenue ,code of #aihf issued on or after the date of the enactment of this ,act4 7#b7 ,removal of one-refunding limit ,the amendments made by subsection 7b7 shall apply to repayments of loans received after ,july #cj1 #bjjh4 #g ,reforms relating to disabled veterans #aagja4 ,treatment of veteran disability compensation or pension payments for purposes of low income housing tax credit and residential rental project bonds 7a7 ,in general ,section #adb7;d77#b77;,b7 is amended by adding at the end the following new clause3 7v7 ,veteran disability compensation or pension ,for purposes of determining income under this subparagraph1 payments of disability compensation or pension under chapter #aa or #ae of title #ch1 ,united ,states ,code1 shall be disregarded4 4 7b7 ,effective date ,the amendments made by this section shall apply to determinations made after the date of the enactment of this ,act4 #h ,reforms relating to certain other populations #aahja4 ,additional housing credit allocations for certain populations who face unique barriers to affordable housing 7a7 ,in general ,section #db of the ,internal ,revenue ,code of #aihf is amended by redesignating subsection 7n7 as subsection 7o7 and by inserting after subsection 7m7 the following new subsection3 7n7 ,additional allocation for units for certain populations who face unique barriers to affordable housing 7#a7 ,in general ,a housing credit agency may allocate1 in any calendar year1 an amount equal to #e percent of the amount such housing credit agency may allocate under subsection 7h77#c77;,c7 to projects which contain a unit described in paragraph 7#b74 7#b7 ,unit described ,a unit is described in this paragraph if-- 7,a7 such unit is part of a low-income housing project1 7,b7 the housing credit agency and the owner of such unit1 not later than the first day of the second year of the credit period of such project1 execute a compliance agreement1 7,c7 the taxpayer prioritizes populations who face unique barriers to affordable housing for occupancy of such units1 and 7,d7 the taxpayer1 in consultation with covered service providers1 makes available to any resident of such unit appropriate supportive services during the compliance period4 7#c7 ,compliance agreement ,for purposes of paragraph 7#b77;,b71 the term compliance agreement means an agreement which-- 7,a7 requires the owner of a unit to submit to the housing credit agency for approval a supportive service plan for each calendar year during the compliance period1 7,b7 requires the approval of the housing credit agency with respect to any agreement between such owner and any covered service provider relating to services provided pursuant to this subsection1 and 7,c7 allows the housing credit agency to monitor compliance with such agreement and with the requirements of this subsection4 7#d7 ,populations who face unique barriers to affordable housing ,for purposes of this subsection1 the term populations who face unique barriers to affordable housing means individuals who are-- 7,a7 formerly justice-involved individuals1 7,b7 current or former foster youths1 or 7,c7 kinship caregivers4 7#e7 ,covered service provider ,for purposes of this subsection1 the term covered service provider means any entity with demonstrated experience providing supportive services to populations who face unique barriers to affordable housing4 7#f7 ,formerly justice-involved individual ,for purposes of this paragraph1 the term formerly justice-involved individual means an individual who faces barriers to obtaining housing as a result of being arrested1 charged1 or convicted of any criminal offense4 7#g7 ,current or former foster youth ,the term current or former foster youth means an individual who was eligible at any time to receive services under section #dgg7;a7 of the ,social ,security ,act4 7#h7 ,not included in aggregate housing credit dollar amount ,an amount allocated under paragraph 7#a7 shall not be included in the aggregate housing credit dollar amount for any calendar year of the ,state which made such allocation4 7#i7 ,enforcement ,the ,secretary shall1 in consultation with housing credit agencies1 establish such mechanisms 7including penalties7 as the ,secretary determines appropriate to ensure that-- 7,a7 each unit with respect to which a credit is allowed under paragraph 7#a7 meets the requirements described in paragraph 7#b71 and 7,b7 each housing credit agency which makes an allocation under paragraph 7#a7 is taking appropriate steps to enforce each compliance agreement to which such housing credit agency is a party under paragraph 7#c74 4 7b7 ,allocations allowed in addition to ,state ceiling ,section #db7;h77#a7 of such ,code is amended by striking the housing credit dollar amount allocated to such building under this subsection and inserting the sum of the housing credit dollar amounts allocated to such building under this subsection and subsection 7n74 7c7 ,effective date ,the amendments made by this section shall apply to calendar years beginning after #bjbf4 #i ,qualified contracts and right of first refusal #aaija4 ,repeal of qualified contract option 7a7 ,termination of option for certain buildings 7#a7 ,in general ,subclause 7,,ii7 of section #db7;h77#f77;,e77i7 is amended by inserting in the case of a building described in clause 7iii71 before on the last day4 7#b7 ,buildings described ,subparagraph 7,e7 of section #db7;h77#f7 is amended by adding at the end the following new clause3 7iii7 ,buildings described ,a building described in this clause is a building-- 7,i7 which received its allocation of housing credit dollar amount before ,january #a1 #bjbf1 or 7,,ii7 in the case of a building any portion of which is financed as described in paragraph 7#d71 and which received before ,january #a1 #bjbf1 under the rules of paragraphs 7#a7 and 7#b7 of subsection 7m71 a determination from the issuer of the tax-exempt bonds or the housing credit agency that the building would be eligible under the qualified allocation plan to receive an allocation of housing credit dollar amount or that the credits to be earned are necessary for financial feasibility of the project and its viability as a qualified low-income housing project throughout the credit period4 4 7b7 ,rules relating to existing projects ,subparagraph 7,f7 of section #db7;h77#f7 is amended by striking the nonlow-income portion and all that follows and inserting the nonlow-income portion and the low-income portion of the building for fair market value 7determined by the housing credit agency by taking into account the rent restrictions required for the low-income portion of the building to continue to meet the standards of paragraphs 7#a7 and 7#b7 of subsection 7g774 ,the ,secretary shall prescribe such regulations as may be necessary or appropriate to carry out this paragraph44 7c7 ,conforming amendments 7#a7 ,paragraph 7#f7 of section #db7;h7 is amended by striking subparagraph 7,g7 and by redesignating subparagraphs 7,h71 7,i71 7,j71 and 7,k7 as subparagraphs 7,g71 7,h71 7,i71 and 7,j71 respectively4 7#b7 ,subclause 7,,ii7 of section #db7;h77#f77;,e77i7 is amended by striking subparagraph 7,i7 and inserting subparagraph 7,h74 7d7 ,effective dates 7#a7 ,in general ,except as provided in paragraph 7#b71 the amendments made by this section shall take effect on the date of the enactment of this ,act4 7#b7 ,subsection 7b7 ,the amendments made by subsection 7b7 shall apply to buildings with respect to which a written request described in section #db7;h77#f77;,h7 of the ,internal ,revenue ,code of #aihf1 as redesignated by subsection 7c71 is submitted after the date of the enactment of this ,act4 #aaijb4 ,modification and clarification of rights relating to building purchase 7a7 ,modification of right of first refusal 7#a7 ,in general ,subparagraph 7,a7 of section #db7;i77#g7 is amended by striking a right of #ast refusal and inserting an option4 7#b7 ,conforming amendment ,the heading of paragraph 7#g7 of section #db7;i7 is amended by striking right of #ast refusal and inserting option4 7b7 ,clarification with respect to right of first refusal and purchase options 7#a7 ,purchase of partnership interest 7,a7 ,in general ,subparagraph 7,a7 of section #db7;i77#g71 as amended by subsection 7a71 is amended by striking the property and inserting the property or all of the partnership interests 7other than interests of the person exercising such option or a related party thereto 7within the meaning of section #bfg7;b7 or #gjg7;b77#a777 relating to the property4 7,b7 ,application to ,s corporations and other pass-through entities ,subparagraph 7,a7 of section #db7;i77#g7 is amended by adding at the end the following3 ,except as provided by the ,secretary1 the rules of this paragraph shall apply to ,s corporations and other pass-through entities in the same manner as such rules apply to partnerships44 7,c7 ,conforming amendment ,subparagraph 7,b7 of section #db7;i77#g7 is amended by adding at the end the following3 ,in the case of a purchase of all of the partnership interests1 the minimum purchase price under this subparagraph shall be an amount not less than the sum of the interests' shares of the amount which would be determined with respect to the property under this subparagraph without regard to this sentence44 7#b7 ,property includes assets relating to the building ,paragraph 7#g7 of section #db7;i7 is amended by adding at the end the following new subparagraph3 7,c7 ,property ,for purposes of subparagraph 7,a71 the term property may include all or any of the assets held for the development1 operation1 or maintenance of a building4 4 7#c7 ,exercise of right of first refusal and purchase options ,subparagraph 7,a7 of section #db7;i77#g71 as amended by subsection 7a7 and paragraph 7#a77;,a71 is amended by adding at the end the following3 8,for purposes of determining whether an option1 including a right of first refusal1 to purchase property or all of the partnership interests holding 7directly or indirectly7 such property is described in the preceding sentence-- 7i7 such option or right of first refusal shall be exercisable with or without the approval of any owner of the project 7including any partner1 member1 or affiliated organization of such an owner71 and 7ii7 a right of first refusal shall be exercisable in response to any offer to purchase the property or all of the partnership interests1 including an offer by a related party4 4 7c7 ,other conforming amendment ,subparagraph 7,b7 of section #db7;i77#g71 as amended by subsection 7b71 is amended by striking the sum of and all that follows through application of clause 7ii74 and inserting the following3 the principal amount of outstanding indebtedness secured by the building 7other than indebtedness incurred within the #e-year period ending on the date of the sale to the tenants744 7d7 ,effective dates 7#a7 ,modification of right of first refusal ,the amendments made by subsections 7a7 and 7c7 shall apply to agreements entered into or amended after the date of the enactment of this ,act4 7#b7 ,clarification ,the amendments made by subsection 7b7 shall apply to agreements among the owners of the project 7including partners1 members1 and their affiliated organizations7 and persons described in section #db7;i77#g77;,a7 of the ,internal ,revenue ,code of #aihf entered into before1 on1 or after the date of the enactment of this ,act4 7#c7 ,no effect on agreements ,none of the amendments made by this section is intended to supersede express language in any agreement with respect to the terms of a right of first refusal or option permitted by section #db7;i77#g7 of the ,internal ,revenue ,code of #aihf in effect on the date of the enactment of this ,act4 ,b ,additional housing incentives #abjja4 ,investment credit for conversion of non-residential buildings to affordable housing 7a7 ,in general ,subpart ,e of part ,,iv of subchapter ,a of chapter #a is amended by inserting after section #dh;,e the following new section3 #dh;,f4 ,affordable housing conversion credit 7a7 ,allowance of credit ,for purposes of section #df1 the affordable housing conversion credit for any taxable year is an amount equal to #bj percent of the qualified conversion expenditures of the taxpayer with respect to a qualified affordable housing building placed in service by the taxpayer during the taxable year4 7b7 ,qualified conversion expenditures ,for purposes of this section-- 7#a7 ,in general ,the term qualified conversion expenditures means1 with respect to any qualified affordable housing building1 any amount properly chargeable to capital account-- 7,a7 for property for which depreciation is allowable under section #afh1 and 7,b7 in connection with the qualified conversion of a qualified affordable housing building4 7#b7 ,certain expenditures not included ,the term qualified conversion expenditures does not include-- 7,a7 ,limitation on period of conversion ,except as provided in subsection 7f71 any amount paid or incurred other than during the #b-year period ending on the date on which the taxpayer places the qualified affordable housing building in service4 7,b7 ,cost of acquisition ,the cost of acquiring any building or interest therein4 7#c7 ,special rule for brownfields ,paragraph 7#a77;,a7 shall not apply with respect to any expenditure for clean up of qualifying brownfield property 7as defined in section #eab7;b77#ai774 7#d7 ,coordination with rehabilitation credit ,in the case of any qualified conversion expenditures which are taken into account for purposes of determining the rehabilitation credit under section #dg1 the amount of such expenditures taken into account under this section 7determined without regard to this paragraph7 shall be reduced by #ej percent4 7c7 ,qualified conversion ,for purposes of this section-- 7#a7 ,in general ,the term qualified conversion means the conversion of an eligible commercial building into a qualified affordable housing building if the qualified conversion expenditures of the taxpayer with respect to such conversion exceed the greater of-- 7,a7 an amount equal to #ej percent of the adjusted basis of such building 7determined immediately prior to such conversion71 or 7,b7 #ajj1jjj4 7#b7 ,eligible commercial building ,the term eligible commercial building means any building which1 with respect to any conversion-- 7,a7 was originally placed in service not less than #bj years before the date on which such conversion begins1 and 7,b7 immediately prior to such conversion1 was nonresidential real property 7as defined in section #afh74 7d7 ,qualified affordable housing building ,for purposes of this section-- 7#a7 ,in general ,the term qualified affordable housing building means any residential building if during the #cj-year period beginning on the date on which such building is placed in service by the taxpayer1 not less than #bj percent of the residential units in the building are both rent-restricted and reserved for individuals whose income is #hj percent or less of the area median income4 7#b7 ,rent and income limitation ,for purposes of this subsection1 rules similar to the rules of subsection 7g7 of section #db shall apply to determine whether a unit is rent-restricted1 treatment of units occupied by individuals whose incomes rise above the limit1 and the treatment of units where ,federal rental assistance is reduced as tenant's income increases4 7e7 ,limitation on aggregate credit allowable 7#a7 ,credit may not exceed credit amount allocated to building 7,a7 ,in general ,the amount of the credit determined under this section with respect to any building shall not exceed the qualified conversion credit dollar amount allocated to such building under this subsection by the housing credit agency of the ,state in which such building is located4 7,b7 ,time for making allocation ,except in the case of an allocation which meets the requirements of subparagraph 7,c71 an allocation shall be taken into account under subparagraph 7,a7 only if it is made not later than the close of the calendar year in which the building is placed in service4 7,c7 ,exception where binding commitment ,an allocation meets the requirements of this subparagraph if there is a binding commitment 7not later than the close of the calendar year in which the building is placed in service7 by the housing credit agency to allocate a specified housing credit dollar amount to such building beginning in a later taxable year4 7#b7 ,state limitation 7,a7 ,in general ,the aggregate qualified conversion credit dollar amount which a housing credit agency of any ,state may allocate is the sum of-- 7i7 the amount which bears the same ratio to the national qualified conversion credit limitation as-- 7,i7 the population of such ,state1 bears to 7,,ii7 the population of all ,states1 plus 7ii7 the sum of any amounts determined under subparagraph 7,c74 7,b7 ,national qualified conversion credit limitation ,the national qualified conversion credit limitation is #ab1jjj1jjj1jjj4 7,c7 ,additional amounts provided for certain buildings in economically distressed areas 7i7 ,in general ,for purposes of subparagraph 7,a77ii71 in any case in which-- 7,i7 the housing credit agency of a ,state allocates an amount to a building which is located in an economically distressed area1 and 7,,ii7 the ,secretary subsequently designates such amount for purposes of this paragraph1 the amount determined under this paragraph with respect to such building shall be the amount originally allocated by the housing credit agency of the ,state under clause 7i74 7ii7 ,limitation ,the aggregate amount which the ,secretary may designate under clause 7i77,,ii7 shall not exceed #c1jjj1jjj1jjj4 7iii7 ,manner of designation ,not later than #abj days after the date of the enactment of this section1 the ,secretary shall establish a program for determining the designation of amounts that may be designated under this subparagraph4 7,d7 ,reallocation of certain amounts 7i7 ,in general ,notwithstanding subparagraph 7,a7-- 7,i7 no amount may be allocated under paragraph 7#a7 by a housing credit agency of an undersubscribed ,state after ,december #ca1 #bjbh1 and 7,,ii7 the dollar amount determined under subparagraph 7,a7 with respect to any oversubscribed ,state after such date shall be increased by such ,state's share of the reallocation amount4 7ii7 ,state share ,for purposes of clause 7i71 an oversubscribed ,state's share of the reallocation amount is the amount which bears the same ratio to the reallocation amount as-- 7,i7 the population of such ,state1 bears to 7,,ii7 the population of all oversubscribed ,states4 7iii7 ,definitions ,for purposes of this subparagraph-- 7,i7 ,undersubscribed ,state ,the term undersubscribed ,state means any ,state that is not an oversubscribed ,state4 7,,ii7 ,oversubscribed ,state ,the term oversubscribed ,state means any ,state the housing credit agency of which has allocated all of the qualified conversion credit dollar amount which may be allocated by it before the date described in clause 7i77,i74 7,,iii7 ,reallocation amount ,the term reallocation amount means the sum of the amounts described in subparagraph 7,a7 which have not been allocated by undersubscribed ,states before the date described in clause 7i77,i74 7#c7 ,manner of allocation 7,a7 ,plan for allocation 7i7 ,in general ,notwithstanding any other provision of this section1 the qualified conversion credit dollar amount with respect to any building shall be zero unless such amount was allocated pursuant to a conversion credit allocation plan of the housing credit agency which is approved by the governmental unit 7in accordance with rules similar to the rules of section #adg7;f77#b7 7other than subparagraph 7,b77ii7 thereof77 of which such agency is a part4 7ii7 ,conversion credit allocation plan ,for purposes of this subparagraph1 the term conversion credit allocation plan means a plan-- 7,i7 which sets selection criteria for allocations1 taking into account-- 7aa7 whether the credit is needed to assure the financial feasibility of the conversion1 7bb7 the extent to which the conversion results in the creation of affordable housing1 7cc7 the extent to which the conversion results in the creation of housing near transportation1 employment1 and commercial opportunities1 7dd7 the extent to which the conversion will support small businesses and economic revitalization in the surrounding area1 7ee7 the degree of local government support for the conversion1 and 7ff7 the readiness of the building for a qualified conversion1 and 7,,ii7 which provides a procedure that the agency 7or an agent or other private contractor of such agency7 will follow in monitoring for noncompliance with the requirements of subsection 7d7 and in notifying the ,internal ,revenue ,service of such noncompliance4 7,b7 ,binding allocation agreements2 reporting ,in making allocations of qualified conversion credit dollar amounts1 each housing credit agency shall-- 7i7 enter into binding agreements with taxpayers for the allocation of qualified conversion credit dollar amounts1 which agreements shall specify the amount of qualified conversion credit dollar amount allocated to the building and the terms for any modifications or withdrawal of such allocation1 and 7ii7 report to the ,secretary1 at such time and in such manner as the ,secretary may require1 the amount of allocations made with respect to any building4 7,c7 ,state extended use requirements permitted past #cj years ,for purposes of this paragraph1 a housing credit agency's plan shall not fail to be treated as a conversion credit allocation plan merely because it includes1 and nothing in this section shall be construed to limit a binding allocation agreement from including1 affordability or rent restriction requirements with respect to the building that apply for a longer period than the #cj-year period described in subsections 7d7 and 7g77#a77;,b74 7#d7 ,definitions and other rules 7,a7 ,housing credit agency ,the term housing credit agency means1 with respect to any ,state1 the housing credit agency authorized under section #db7;h77#h7 or such other agency as authorized by the ,state for purposes of this section4 7,b7 ,economically distressed area ,the term economically distressed area means any area which-- 7i7 has been designated as a qualified census tract under section #db7;d77#e77;,b77ii7 or as a difficult development area under section #db7;d77#e77;,b77iii71 or 7ii7 meets the requirement of section #cja7;a77#c7 of the ,public ,works and ,economic ,development ,act of #aife4 7,c7 ,state ,the term ,state includes a possession of the ,united ,states4 7,d7 ,other rules ,rules similar to the rules of subparagraphs 7,a7 and 7,b7 of section #db7;h77#g7 shall apply for purposes of this section4 7f7 ,progress expenditures ,if the ,secretary determines1 on the basis of architectural plans and specifications that a qualified conversion is reasonably expected to exceed #b years1 rules similar to the rules of section #dg7;d7 shall apply with respect to such conversion for purposes of this section4 7g7 ,special rules for certain areas 7#a7 ,qualified census tracts and difficult development areas ,in the case of a qualified affordable housing building-- 7,a7 which is located in any area which is designated as a qualified census tract under section #db7;d77#e77;,b77ii7 or as a difficult development area under section #db7;d77#e77;,b77iii71 and 7,b7 with respect to which during #cj-year period beginning on the date on which such building is placed in service by the taxpayer1 not less than #bj percent of the residential units in the building are both rent-restricted and reserved for individuals whose income is #fj percent or less of the area median income1 subsection 7a7 shall be applied by substituting #cj percent for #bj percent4 7#b7 ,historic preservation in rural areas 7,a7 ,in general ,in the case of a qualified affordable housing building which is in a rural area and is part of an historic preservation project1 the taxpayer may elect to substitute #ce percent for #bj percent under subsection 7a7 with respect to such portion of the aggregate qualified conversion expenditures taken into account under such subsection as does not exceed #b1jjj1jjj4 7,b7 ,definitions ,for purposes of this paragraph-- 7i7 ,rural area ,the term rural area shall have the meaning given such term under section #acic7;a77#b74 7ii7 ,historic preservation project ,the term historic preservation project means a qualified conversion which involves the certified rehabilitation of a certified historic structure4 ,whether conversion of a certified historic structure involves certified rehabilitation shall be determined under rules similar to the rules of section #dg7;c77#b77;,c74 7h7 ,regulations ,the ,secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section1 including regulations or other guidance-- 7#a7 providing for the recapture of the credit determined under subsection 7a7 if the qualified affordable housing building ceases to be a qualified affordable housing building during the #cj-year period beginning on the date that such building is placed in service by the taxpayer1 7#b7 detailing any certifications required from the taxpayer or any housing credit agency of a ,state1 7#c7 with respect to the application of subsection 7b77#d71 7#d7 with respect to information reporting on allocations of qualified conversion credit dollar amounts1 7#e7 providing rules for making a determination as to whether an area is described in subsection 7e77#d77;,b71 and 7#f7 which encourages housing credit agencies to allocate1 to the extent practicable1 qualified conversion credit dollar amounts to non-metropolitan counties within a ,state in proportion to the non-metropolitan population of the ,state1 but only to the extent it is demonstrated within such non-metropolitan counties that there are sufficient qualified conversion expenditures to warrant such allocations4 4 7b7 ,transferability of credit ,section #fdah7;f77#a77;,a7 is amended by adding at the end the following new clause3 7xiii7 ,the affordable housing conversion credit determined under section #dh;,f4 4 7c7 ,conforming amendments 7#a7 ,section #df is amended in paragraph 7#f7 by striking and at the end1 in paragraph 7#g7 by striking the period at the end and inserting 1 and1 and by adding at the end the following new paragraph3 7#h7 the affordable housing conversion credit4 4 7#b7 ,section #di7;a77#a77;,c7 is amended by striking and at the end of clause 7vii71 in clause 7viii7 by striking the period at the end and inserting 1 and1 and by adding at the end the follow new clause3 7ix7 the basis of any property which is being converted as part of a qualified conversion under section #dh;,f4 4 7#c7 ,section #ej7;a77#b77;,e7 is amended by striking or #dh;,e7e7 and inserting #dh;,e7e71 or #dh;,f7f74 7#d7 ,the table of sections for subpart ,e of part ,,iv of subchapter ,a of chapter #a is amended by adding at the end the following new item3 ,sec4 #dh;,f4 ,affordable housing conversion credit4 4 7d7 ,effective date ,the amendments made by this section shall apply to qualified affordable housing buildings 7as defined in section #dh;,f of the ,internal ,revenue ,code of #aihf1 as added by this section7 placed in service after the date of the enactment of this ,act4 #abjjb4 ,neighborhood homes credit 7a7 ,in general ,subpart ,d of part ,,iv of subchapter ,a of chapter #a is amended by inserting after section #db the following new section3 #db;,a4 ,neighborhood homes credit 7a7 ,allowance of credit ,for purposes of section #ch1 the neighborhood homes credit determined under this section for the taxable year is1 with respect to each qualified residence sold by the taxpayer during such taxable year in an affordable sale1 the lesser of-- 7#a7 an amount equal to-- 7,a7 the excess 7if any7 of-- 7i7 the reasonable development costs paid or incurred by the taxpayer with respect to such qualified residence1 over 7ii7 the sale price of such qualified residence 7reduced by any reasonable expenses paid or incurred by the taxpayer in connection with such sale71 or 7,b7 if the neighborhood homes credit agency determines it is necessary to ensure financial feasibility1 an amount not to exceed #abj percent of the amount under subparagraph 7,a71 7#b7 #dj percent of the eligible development costs paid or incurred by the taxpayer with respect to such qualified residence1 or 7#c7 #cb percent of the national median sale price for new homes 7as determined pursuant to the most recent census data available as of the date on which the neighborhood homes credit agency makes an allocation for the qualified project74 7b7 ,development costs ,for purposes of this section-- 7#a7 ,reasonable development costs 7,a7 ,in general ,the term reasonable development costs means amounts paid or incurred for the acquisition of buildings and land1 construction1 substantial rehabilitation1 demolition of structures1 or environmental remediation1 to the extent that the neighborhood homes credit agency determines that such amounts meet the standards specified pursuant to subsection 7f77#a77;,d7 7as of the date on which construction or substantial rehabilitation is substantially complete1 as determined by such agency7 and are necessary to ensure the financial feasibility of such qualified residence4 7,b7 ,considerations in making determination ,in making the determination under subparagraph 7,a71 the neighborhood homes credit agency shall consider-- 7i7 the sources and uses of funds and the total financing1 7ii7 any proceeds or receipts generated or expected to be generated by reason of tax benefits1 and 7iii7 the reasonableness of the developmental costs and fees4 7#b7 ,eligible development costs ,the term eligible development costs means the amount which would be reasonable development costs if the amounts taken into account as paid or incurred for the acquisition of buildings and land did not exceed #ge percent of such costs determined without regard to any amount paid or incurred for the acquisition of buildings and land4 7#c7 ,substantial rehabilitation ,the term substantial rehabilitation means amounts paid or incurred for rehabilitation of a qualified residence if such amounts exceed the greater of-- 7,a7 #be1jjj1 or 7,b7 #bj percent of the amounts paid or incurred by the taxpayer for the acquisition of buildings and land with respect to such qualified residence4 7#d7 ,construction and rehabilitation only after allocation taken into account 7,a7 ,in general ,the terms reasonable development costs and eligible development costs shall not include any amount paid or incurred before the date on which an allocation is made to the taxpayer under subsection 7e7 with respect to the qualified project of which the qualified residence is part unless such amount is paid or incurred for the acquisition of buildings or land4 7,b7 ,land and building acquisition costs ,amounts paid or incurred for the acquisition of buildings or land shall be included under paragraph 7,a7 only if paid or incurred not more than #c years before the date on which the allocation referred to in subparagraph 7,a7 is made4 ,if the taxpayer acquired any building or land from an entity 7or any related party to such entity7 that holds an ownership interest in the taxpayer1 then such entity must also have acquired such property within such #c-year period1 and the acquisition cost included under subparagraph 7,a7 with respect to the taxpayer shall not exceed the amount such entity paid or incurred to acquire such property4 7c7 ,qualified residence ,for purposes of this section-- 7#a7 ,in general ,the term qualified residence means a residence that-- 7,a7 is real property 7constructed on-site or manufactured off-site7 affixed on a permanent foundation1 7,b7 is-- 7i7 a house which is comprised of #d or fewer residential units1 7ii7 a condominium unit1 or 7iii7 a house or an apartment owned by a cooperative housing corporation 7as defined in section #baf7;b771 7,c7 is part of a qualified project with respect to which the neighborhood homes credit agency has made an allocation under subsection 7e71 and 7,d7 is located in a qualified census tract 7determined as of the date of such allocation74 7#b7 ,qualified census tract 7,a7 ,in general ,the term qualified census tract means a census tract-- 7i7 which-- 7,i7 has a median family income which does not exceed #hj percent of the median family income for the applicable area1 7,,ii7 has a poverty rate that is not less than #acj percent of the poverty rate of the applicable area1 and 7,,iii7 has a median value for owner-occupied homes that does not exceed the median value for owner-occupied homes in the applicable area1 7ii7 which-- 7,i7 is located in a city which has a population of not less than #ej1jjj and such city has a poverty rate that is not less than #aej percent of the poverty rate of the applicable area1 7,,ii7 has a median family income which does not exceed the median family income for the applicable area1 and 7,,iii7 has a median value for owner-occupied homes that does not exceed #hj percent of the median value for owner-occupied homes in the applicable area1 7iii7 which-- 7,i7 is located in a nonmetropolitan county1 7,,ii7 has a median family income which does not exceed the median family income for the applicable area1 and 7,,iii7 has been designated by a neighborhood homes credit agency under this clause1 7iv7 which is not otherwise a qualified census tract and is located in a disaster area 7as defined in section #gejh;,a7d77#c771 but only with respect to credits allocated in any period during which the ,president of the ,united ,states has determined that such area warrants individual or individual and public assistance by the ,federal ,government under the ,robert ,t4 ,stafford ,disaster ,relief and ,emergency ,assistance ,act1 or 7v7 which is not otherwise a qualified census tract and is identified by the neighborhood homes credit agency1 through methodologies detailed in the qualified allocation plan1 as having a shortage of affordable owner-occupied homes4 7,b7 ,applicable area ,the term applicable area means-- 7i7 in the case of a metropolitan census tract1 the metropolitan area in which such census tract is located1 and 7ii7 in the case of a census tract other than a census tract described in clause 7i71 the ,state4 7d7 ,affordable sale ,for purposes of this section-- 7#a7 ,in general ,the term affordable sale means a sale to a qualified homeowner of a qualified residence that the neighborhood homes credit agency certifies as meeting the standards promulgated under subsection 7f77#a77;,d7 for a price that does not exceed-- 7,a7 in the case of any qualified residence not described in subparagraph 7,b71 7,c71 or 7,d71 the amount equal to the product of #d multiplied by the median family income for the applicable area 7as determined pursuant to the most recent census data available as of the date of the contract for such sale71 7,b7 in the case of a house comprised of #b residential units1 #abe percent of the amount described in subparagraph 7,a71 7,c7 in the case of a house comprised of #c residential units1 #aej percent of the amount described in subparagraph 7,a71 or 7,d7 in the case of a house comprised of #d residential units1 #age percent of the amount described in subparagraph 7,a74 7#b7 ,qualified homeowner ,the term qualified homeowner means1 with respect to a qualified residence1 an individual-- 7,a7 who owns and uses such qualified residence as the principal residence of such individual1 and 7,b7 whose family income 7determined as of the date that a binding contract for the affordable sale of such residence is entered into7 is #adj percent or less of the median family income for the applicable area in which the qualified residence is located4 7e7 ,credit ceiling and allocations 7#a7 ,credit limited based on allocations to qualified projects 7,a7 ,in general ,the credit allowed under subsection 7a7 to any taxpayer for any taxable year with respect to one or more qualified residences which are part of the same qualified project shall not exceed the excess 7if any7 of-- 7i7 the amount allocated by the neighborhood homes credit agency under this paragraph to such taxpayer with respect to such qualified project1 over 7ii7 the aggregate amount of credit allowed under subsection 7a7 to such taxpayer with respect to qualified residences which are a part of such qualified project for all prior taxable years4 7,b7 ,deadline for completion ,no credit shall be allowed under subsection 7a7 with respect to any qualified residence unless the affordable sale of such residence is during the #e-year period beginning on the date of the allocation to the qualified project of which such residence is a part 7or1 in the case of a qualified residence to which subsection 7i7 applies1 the rehabilitation of such residence is completed during such #e-year period74 7#b7 ,limitations on allocations to qualified projects 7,a7 ,allocations limited by ,state neighborhood homes credit ceiling ,the aggregate amount allocated to taxpayers with respect to qualified projects by the neighborhood homes credit agency of any ,state for any calendar year shall not exceed the ,state neighborhood homes credit amount of such ,state for such calendar year4 7,b7 ,set-aside for certain projects involving qualified nonprofit organizations ,rules similar to the rules of section #db7;h77#e7 shall apply for purposes of this section4 7#c7 ,determination of ,state neighborhood homes credit ceiling 7,a7 ,in general ,the ,state neighborhood homes credit amount for a ,state for a calendar year is an amount equal to the sum of-- 7i7 the greater of-- 7,i7 the product of #i1 multiplied by the ,state population 7determined in accordance with section #adf7;j771 or 7,,ii7 #ab1jjj1jjj1 and 7ii7 any amount previously allocated to any taxpayer with respect to any qualified project by the neighborhood homes credit agency of such ,state which can no longer be allocated to any qualified residence because the #e-year period described in paragraph 7#a77;,b7 expires during calendar year4 7,b7 #c-year carryforward of unused limitation ,the ,state neighborhood homes credit amount for a ,state for a calendar year shall be increased by the excess 7if any7 of the ,state neighborhood homes credit amount for such ,state for the preceding calendar year over the aggregate amount allocated by the neighborhood homes credit agency of such ,state during such preceding calendar year4 ,any amount carried forward under the preceding sentence shall not be carried past the third calendar year after the calendar year in which such credit amount originally arose1 determined on a first-in1 first-out basis4 7f7 ,responsibilities of neighborhood homes credit agencies 7#a7 ,in general ,notwithstanding subsection 7e71 the ,state neighborhood homes credit dollar amount shall be zero for a calendar year unless the neighborhood homes credit agency of the ,state-- 7,a7 allocates such amount pursuant to a qualified allocation plan of the neighborhood homes credit agency1 7,b7 subject to paragraph 7#b71 allocates not more than #bj percent of amounts allocated in the previous year 7or for allocations made in the first allocation year under this section1 not more than #bj percent of the neighborhood homes credit ceiling for such year7 to projects with respect to qualified residences which-- 7i7 are located in census tracts described in subsection 7c77#b77;,a77iii71 7c77#b77;,a77iv71 7i77#e71 or 7ii7 are not located in a qualified census tract but meet the requirements of subsection 7i77#h71 7,c7 subject to paragraph 7#b71 in addition to any allocation described in subparagraph 7,b71 allocates not more than #bj percent of amounts allocated in the previous year 7or for allocations made in the first allocation year under this section1 not more than #bj percent of the neighborhood homes credit ceiling for such year7 to projects with respect to qualified residences which are located in any census tract described in subsection 7c77#b77;,a77v71 except that1 with respect to any qualified residence located within such census tract which is sold to a qualified homeowner1 subsection 7d77#b7 shall be applied by substituting #abj percent for #adj percent1 7,d7 promulgates standards with respect to reasonable qualified development costs and fees1 7,e7 promulgates standards with respect to construction quality which are consistent with building codes or other standards required by the ,state or local jurisdiction in which the project is located1 7,f7 in the case of any neighborhood homes credit agency which makes an allocation to a qualified project which includes any qualified residence to which subsection 7i7 applies1 promulgates standards with respect to protecting the owners of such residences1 including the capacity of such owners to pay rehabilitation costs not covered by the credit provided by this section and providing for the disclosure to such owners of their rights and responsibilities with respect to the rehabilitation of such residences1 7,g7 submits to the ,secretary 7at such time and in such manner as the ,secretary may prescribe7 an annual report specifying-- 7i7 the amount of the neighborhood homes credits allocated to each qualified project for the previous year1 7ii7 with respect to each qualified residence completed in the preceding calendar year-- 7,i7 the census tract in which such qualified residence is located1 7,,ii7 with respect to the qualified project that includes such qualified residence1 the year in which such project received an allocation under this section1 7,,iii7 whether such qualified residence was new1 substantially rehabilitated and sold to a qualified homeowner1 or substantially rehabilitated pursuant to subsection 7i71 7,,iv7 the eligible development costs of such qualified residence1 7,v7 the amount of the neighborhood homes credit with respect to such qualified residence1 7,,vi7 the sales price of such qualified residence1 if applicable1 and 7,,vii7 the family income of the qualified homeowner 7expressed as a percentage of the applicable area median family income for the location of the qualified residence71 and 7iii7 such other information as the ,secretary may require1 7,h7 makes available to the general public a written explanation for any allocation of a neighborhood homes credit dollar amount which is not made in accordance with established priorities and selection criteria of the neighborhood homes credit agency1 and 7,i7 provide educational outreach on application and compliance requirements1 including for small residential builders and remodelers4 7#b7 ,alternative for certain ,states 7,a7 ,in general ,in the case of any ,state which1 for a calendar year1 is an applicable ,state 7as defined in subparagraph 7,b771 in lieu of the requirements under subparagraphs 7,b7 and 7,c7 of paragraph 7#a71 the neighborhood homes credit agency of the ,state may elect to allocate not more than #dj percent of amounts allocated in the previous year 7or for allocations made in the first allocation year under this section1 not more than #dj percent of the neighborhood homes credit ceiling for such year7 to projects with respect to qualified residences which are described in either subparagraph 7,b7 or 7,c7 of paragraph 7#a74 7,b7 ,applicable ,state ,for purposes of this paragraph1 the term applicable ,state means a ,state which1 for purposes of the determining the amount under subsection 7e77#c77;,a77i7 for the calendar year with respect to such ,state1 received the amount described in subclause 7,,ii7 of such subsection4 7#c7 ,qualified allocation plan ,for purposes of this subsection1 the term qualified allocation plan means any plan which-- 7,a7 sets forth the selection criteria to be used to prioritize qualified projects for allocations of ,state neighborhood homes credit dollar amounts1 including-- 7i7 the need for new or substantially rehabilitated owner-occupied homes in the area addressed by the project1 7ii7 the expected contribution of the project to neighborhood stability and revitalization1 including the impact on neighborhood residents1 7iii7 the capability and prior performance of the project sponsor1 and 7iv7 the likelihood the project will result in long-term homeownership1 7,b7 has been made available for public comment1 7,c7 as determined by the neighborhood homes credit agency1 is likely to result in the selection of highly qualified applicants while also minimizing1 to the extent practicable1 application costs and barriers to entry for small residential builders and re-modelers1 and 7,d7 provides a procedure that the neighborhood homes credit agency 7or any agent or contractor of such agency7 shall follow for purposes of-- 7i7 identifying noncompliance with any provisions of this section1 and 7ii7 notifying the ,internal ,revenue ,service of any such noncompliance of which the agency becomes aware4 7g7 ,repayment 7#a7 ,in general 7,a7 ,sold during #e-year period ,if a qualified residence is sold during the #e-year period beginning immediately after the affordable sale of such qualified residence referred to in subsection 7a71 the seller shall transfer an amount equal to the repayment amount to the relevant neighborhood homes credit agency4 7,b7 ,use of repayments ,a neighborhood homes credit agency shall use any amount received pursuant to subparagraph 7,a7 only for purposes of qualified projects4 7#b7 ,repayment amount ,for purposes of paragraph 7#a77;,a7-- 7,a7 ,in general ,the repayment amount is an amount equal to the applicable percentage of the gain from the sale to which the repayment relates4 7,b7 ,applicable percentage ,for purposes of subparagraph 7,a71 the applicable percentage is #ej percent1 reduced by #aj percentage points for each year of the #e-year period referred to in paragraph 7#a77;,a7 which ends before the date of such sale4 7#c7 ,lien for repayment amount ,a neighborhood homes credit agency receiving an allocation under this section shall place a lien on each qualified residence that is built or rehabilitated as part of a qualified project for an amount such agency deems necessary to ensure potential repayment pursuant to paragraph 7#a77;,a74 7#d7 ,waiver 7,a7 ,in general ,the neighborhood homes credit agency may waive the repayment required under paragraph 7#a77;,a7 if the agency determines that making a repayment would constitute a hardship to the seller4 7,b7 ,hardship ,for purposes of subparagraph 7,a71 with respect to the seller1 a hardship may include-- 7i7 divorce1 7ii7 disability1 7iii7 illness1 or 7iv7 any other hardship identified by the neighborhood homes credit agency for purposes of this paragraph4 7h7 ,other definitions and special rules ,for purposes of this section-- 7#a7 ,neighborhood homes credit agency ,the term neighborhood homes credit agency means the agency designated by the governor of a ,state as the neighborhood homes credit agency of the ,state4 7#b7 ,qualified project ,the term qualified project means a project that a neighborhood homes credit agency certifies will build or substantially rehabilitate one or more qualified residences4 7#c7 ,determinations of family income ,rules similar to the rules of section #adc7;f77#b7 shall apply for purposes of this section4 7#d7 ,possessions treated as states ,the term ,state includes the ,district of ,columbia and the possessions of the ,united ,states4 7#e7 ,special rules related to condominiums and cooperative housing corporations 7,a7 ,determination of development costs ,in the case of a qualified residence described in clause 7ii7 or 7iii7 of subsection 7c77#a77;,a71 the reasonable development costs and eligible development costs of such qualified residence shall be an amount equal to such costs1 respectively1 of the entire condominium or cooperative housing property in which such qualified residence is located1 multiplied by a fraction-- 7i7 the numerator of which is the total floor space of such qualified residence1 and 7ii7 the denominator of which is the total floor space of all residences within such property4 7,b7 ,tenant-stockholders of cooperative housing corporations treated as owners ,in the case of a cooperative housing corporation 7as such term is defined in section #baf7;b771 a tenant-stockholder shall be treated as owning the house or apartment which such person is entitled to occupy4 7#f7 ,related party sales not treated as affordable sales 7,a7 ,in general ,a sale between related persons shall not be treated as an affordable sale4 7,b7 ,related persons ,for purposes of this paragraph1 a person 7in this subparagraph referred to as the related person7 is related to any person if the related person bears a relationship to such person specified in section #bfg7;b7 or #gjg7;b77#a71 or the related person and such person are engaged in trades or businesses under common control 7within the meaning of subsections 7a7 and 7b7 of section #eb74 ,for purposes of the preceding sentence1 in applying section #bfg7;b7 or #gjg7;b77#a71 #aj percent shall be substituted for #ej percent4 7#g7 ,inflation adjustment 7,a7 ,in general ,in the case of a calendar year after #bjbf1 the dollar amounts in subsections 7b77#c77;,a71 7e77#c77;,a77i77,i71 7e77#c77;,a77i77,,ii71 and 7i77#b77;,c7 shall each be increased by an amount equal to-- 7i7 such dollar amount1 multiplied by 7ii7 the cost-of-living adjustment determined under section #a7;f77#c7 for such calendar year by substituting calendar year #bjbe for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 7,b7 ,rounding 7i7 ,in the case of the dollar amounts in subsections 7b77#c77;,a7 and 7i77#b77;,c71 any increase under paragraph 7#a7 which is not a multiple of #a1jjj shall be rounded to the nearest multiple of #a1jjj4 7ii7 ,in the case of the dollar amount in subsection 7e77#c77;,a77i77,i71 any increase under paragraph 7#a7 which is not a multiple of #j4ja shall be rounded to the nearest multiple of #j4ja4 7iii7 ,in the case of the dollar amount in subsection 7e77#c77;,a77i77,,ii71 any increase under paragraph 7#a7 which is not a multiple of #ajj1jjj shall be rounded to the nearest multiple of #ajj1jjj4 7#h7 ,report 7,a7 ,in general ,the ,secretary shall annually issue a report1 to be made available to the public1 which contains the information submitted pursuant to subsection 7f77#a77;,g74 7,b7 ,de-identification ,the ,secretary shall ensure that any information made public pursuant to subparagraph 7,a7 excludes any information that would allow for the identification of qualified homeowners4 7#i7 ,list of qualified census tracts ,the ,secretary of ,housing and ,urban ,development shall1 for each year1 make publicly available a list of qualified census tracts under-- 7,a7 on a combined basis1 clauses 7i7 and 7ii7 of subsection 7c77#b77;,a71 7,b7 clause 7iii7 of such subsection1 and 7,c7 subsection 7i77#e77;,a74 7#aj7 ,denial of deductions if converted to rental housing ,if1 during the #e-year period beginning immediately after the affordable sale of a qualified residence referred to in subsection 7a71 an individual who owns a qualified residence 7whether or not such individual was the purchaser in such affordable sale7 fails to use such qualified residence as such individual's principal residence for any period of time1 no deduction shall be allowed for expenses paid or incurred by such individual with respect to renting1 during such period of time1 such qualified residence4 7i7 ,application of credit with respect to owner-,occupied rehabilitations 7#a7 ,in general ,in the case of a qualified rehabilitation by the taxpayer of any qualified residence which is owned 7as of the date that the written binding contract referred to in paragraph 7#c7 is entered into7 by a specified homeowner1 the rules of paragraphs 7#b7 through 7#g7 shall apply4 7#b7 ,alternative credit determination ,in the case of any qualified residence described in paragraph 7#a71 the neighborhood homes credit determined under subsection 7a7 with respect to such residence shall 7in lieu of any credit otherwise determined under subsection 7a7 with respect to such residence7 be allowed in the taxable year during which the qualified rehabilitation is completed 7as determined by the neighborhood homes credit agency7 and shall be equal to the least of-- 7,a7 the excess 7if any7 of-- 7i7 the amounts paid or incurred by the taxpayer for the qualified rehabilitation of the qualified residence to the extent that such amounts are certified by the neighborhood homes credit agency 7at the time of the completion of such rehabilitation7 as meeting the standards specified pursuant to subsection 7f77#a77;,d71 over 7ii7 any amounts paid to such taxpayer for such rehabilitation1 7,b7 #ej percent of the amounts described in subparagraph 7,a77i71 or 7,c7 #ej1jjj4 7#c7 ,qualified rehabilitation 7,a7 ,in general ,for purposes of this subsection1 the term qualified rehabilitation means a rehabilitation or reconstruction performed pursuant to a written binding contract between the taxpayer and the specified homeowner if the amount paid or incurred by the taxpayer in the performance of such rehabilitation or reconstruction exceeds the dollar amount in effect under subsection 7b77#c77;,a74 7,b7 ,application of limitation to expenses paid or incurred after allocation ,a rule similar to the rule of section 7b77#d7 shall apply for purposes of this subsection4 7#d7 ,specified homeowner ,for purposes of this subsection1 the term specified homeowner means1 with respect to a qualified residence1 an individual-- 7,a7 who owns and uses such qualified residence as the principal residence of such individual as of the date that the written binding contract referred to in paragraph 7#c7 is entered into1 and 7,b7 whose family income 7determined as of such date7 does not exceed the median family income for the applicable area 7with respect to the census tract in which the qualified residence is located74 7#e7 ,additional census tracts in which owner-occupied residences may be located ,in the case of any qualified residence described in paragraph 7#a71 the term qualified census tract includes any census tract which-- 7,a7 meets the requirements of subsection 7c77#b77;,a77i7 without regard to subclause 7,,iii7 thereof1 and 7,b7 is designated by the neighborhood homes credit agency for purposes of this paragraph4 7#f7 ,modification of repayment requirement ,in the case of any qualified residence described in paragraph 7#a71 subsection 7g7 shall be applied by beginning the #e-year period otherwise described therein on the date on which the qualified homeowner acquired such residence4 7#g7 ,related parties ,paragraph 7#a7 shall not apply if the taxpayer is the owner of the qualified residence described in paragraph 7#a7 or is related 7within the meaning of subsection 7h77#f77;,b77 to such owner4 7#h7 ,pyrrhotite remediation ,the requirement of subsection 7c77#a77;,d7 shall not apply to a qualified rehabilitation under this subsection of a qualified residence that is documented by an engineer's report and core testing to have a foundation that is adversely impacted by pyrrhotite or other iron sulfide minerals4 7j7 ,regulations ,the ,secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section1 including regulations that prevent avoidance of the rules1 and abuse of the purposes1 of this section4 4 7b7 ,credit allowed as part of general business credit ,section #ch7;b7 is amended by striking plus at the end of paragraph 7#dj71 by striking the period at the end of paragraph 7#da7 and inserting 1 plus1 and by adding at the end the following new paragraph3 7#db7 the neighborhood homes credit determined under section #db;,a7a74 4 7c7 ,credit allowed against alternative minimum tax ,section #ch7;c77#d77;,b7 is amended by redesignating clauses 7iv7 through 7xii7 as clauses 7v7 through 7xiii71 respectively1 and by inserting after clause 7iii7 the following new clause3 7iv7 the credit determined under section #db;,a1 4 7d7 ,basis adjustments 7#a7 ,energy efficient home improvement credit ,section #be;,c7g7 is amended by adding after the first sentence the following new sentence3 ,this subsection shall not apply for purposes of determining the eligible development costs or adjusted basis of any building under section #db;,a44 7#b7 ,residential clean energy credit ,section #be;,d7f7 is amended by adding after the first sentence the following new sentence3 ,this subsection shall not apply for purposes of determining the eligible development costs or adjusted basis of any building under section #db;,a44 7#c7 ,new energy efficient home credit ,section #de,l7e7 is amended by inserting or for purposes of determining the eligible development costs or adjusted basis of any building under section #db;,a after section #db4 7e7 ,exclusion from gross income ,part ,,iii of subchapter ,b of chapter #a is amended by inserting before section #adj the following new section3 #aci,m4 ,state energy subsidies for qualified residences 7a7 ,exclusion from gross income ,gross income shall not include the value of any subsidy provided to a taxpayer 7whether directly or indirectly7 by any ,state energy office 7as defined in section #abd7;a7 of the ,energy ,policy ,act of #bjje 7#db ,u4,s4,c4 #aehba7;a777 for purposes of any energy improvements made to a qualified residence 7as defined in section #db;,a7c77#a774 4 7f7 ,conforming amendments 7#a7 ,subsections 7i77#c77;,c71 7i77#f77;,b77i71 and 7k77#a7 of section #dfi are each amended by inserting or #db;,a after section #db4 7#b7 ,the table of sections for subpart ,d of part ,,iv of subchapter ,a of chapter #a is amended by inserting after the item relating to section #db the following new item3 ,sec4 #db;,a4 ,neighborhood homes credit4 4 7#c7 ,the table of sections for part ,,iii of subchapter ,b of chapter #a is amended by inserting before the item relating to section #adj the following new item3 ,sec4 #aci,m4 ,state energy subsidies for qualified residences4 4 7g7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #abjjc4 ,modification of historic rehabilitation tax credit 7a7 ,full credit allowed in the year building placed in service ,section #dg7;a7 is amended to read as follows3 7a7 ,general rule ,for purposes of section #df1 the rehabilitation credit for any taxable year is #bj percent of the qualified rehabilitation expenditures4 4 7b7 ,increase in the rehabilitation credit for certain small projects ,section #dg is amended by adding at the end the following new subsection3 7e7 ,special rule regarding certain small projects 7#a7 ,in general ,in the case of any qualifying small project with respect to which there is an election in effect under this subsection-- 7,a7 the total qualified rehabilitation expenditures taken into account for purposes of this section with respect to the rehabilitation shall not exceed #c1gej1jjj1 7,b7 subsection 7a7 shall be applied by substituting #cj percent for #bj percent1 and 7,c7 subject to paragraph 7#d7 and such regulations or other guidance as the ,secretary may provide1 the taxpayer may transfer all or a portion of the credit determined under this section with respect to such qualifying small project4 7#b7 ,qualifying small project ,for purposes of this subsection1 the term qualifying small project means any qualified rehabilitated building or portion thereof if-- 7,a7 such building is placed in service after the date of the enactment of this subsection1 and 7,b7 no credit was allowed under this section 7other than a credits allowed by reason of subsection 7d77 for either of the two immediately preceding taxable years with respect to such building4 7#c7 ,special rule for rural projects 7,a7 ,in general ,in the case of any qualifying small project in a rural area1 paragraph 7#a77;,a7 shall be applied by substituting #e1jjj1jjj for #c1gej1jjj4 7,b7 ,rural area ,for purposes of this subparagraph1 the term rural area means any area other than-- 7i7 a city or town that has a population of greater than #ej1jjj inhabitants1 or 7ii7 the urbanized area contiguous and adjacent to a city or town described in clause 7i71 as defined by the ,bureau of the ,census based on the latest decennial census of the ,united ,states4 7#d7 ,transfer of credit for qualifying small projects 7,a7 ,certification 7i7 ,in general ,a transfer under paragraph 7#a77;,c7 shall be accompanied by a certificate which includes-- 7,i7 the certification for the certified historic structure referred to in subsection 7c77#c71 7,,ii7 the taxpayer's name1 address1 tax identification number1 date of project completion1 and the amount of credit being transferred1 7,,iii7 the transferee's name1 address1 tax identification number1 and the amount of credit being transferred1 and 7,,iv7 such other information as may be required by the ,secretary4 7ii7 ,transferability of certificate ,a certificate issued under this subsection to a taxpayer shall be transferable to any other taxpayer4 7,b7 ,tax treatment relating to certificate 7i7 ,disallowance of deduction ,no deduction shall be allowed for the amount of consideration paid or incurred by the transferee4 7ii7 ,allowance of credit ,the amount of credit transferred under paragraph 7#a77;,c7-- 7,i7 shall not be allowed to the transferor for any taxable year1 and 7,,ii7 shall be allowable to the transferee as a credit determined under this section for the taxable year of the transferee in which such credit is transferred4 7iii7 ,exclusion ,gross income shall not include any amount received in connection with the transfer of the certificate4 7,c7 ,recapture and other special rules ,the taxpayer who claims a credit determined under this section by reason of a transfer of an amount of credit under paragraph 7#a77;,a7 with respect to an applicable rural project shall be treated as the taxpayer with respect to such project for purposes of section #ej4 7,d7 ,information reporting ,the transferor and the transferee shall each make such reports regarding the transfer of an amount of credit under paragraph 7#a77;,c7 and containing such information as the ,secretary may require4 ,the reports required by this subparagraph shall be filed at such time and in such manner as may be required by the ,secretary4 7,e7 ,regulations ,the ,secretary shall prescribe regulations or other guidance to carry out paragraph 7#a77;,c7 and this paragraph in a manner which is consistent with applicable requirements with respect to transfer of credits under section #fdah4 7#e7 ,election ,an election under this subsection shall be made at such time and in such manner as the ,secretary may by regulations prescribe4 4 7c7 ,increasing the type of buildings eligible for rehabilitation ,section #dg7;c77#a77;,b77i77,i7 is amended by inserting #ej percent of before the adjusted basis4 7d7 ,elimination of rehabilitation credit basis adjustment 7#a7 ,in general ,section #ej7;c7 is amended by adding at the end the following new paragraph3 7#f7 ,exception for rehabilitation credit ,in the case of the rehabilitation credit1 paragraph 7#a7 shall not apply4 4 7#b7 ,treatment in case of credit allowed to lessee ,section #ej7;d7 is amended by adding at the end the following3 ,in the case of the rehabilitation credit1 paragraph 7#e77;,b7 of the section #dh7;d7 referred to in paragraph 7#e7 of this subsection shall not apply44 7e7 ,modifications regarding certain tax-,exempt use property ,section #dg7;c77#b77;,b77v7 is amended by adding at the end the following new subclause3 7,,iii7 ,disqualified lease rules to apply only in case of government entity ,for purposes of subclause 7,i71 except in the case of a tax-exempt entity described in section #afh7;h77#b77;,a77i71 the determination of whether property is tax-exempt use property shall be made under section #afh7;h7 without regard to whether the property is leased in a disqualified lease 7as defined in section #afh7;h77#a77;,b77ii774 4 7f7 ,effective date 7#a7 ,in general ,except as otherwise provided in this subsection1 the amendments made by this section shall apply to property placed in service after the date of the enactment of this ,act4 7#b7 ,full credit allowed in the year building placed in service ,the amendment made by subsection 7a7 shall apply to property placed in service after ,december #ca1 #bjbe4 #abjjd4 ,increase of exclusion of gain from sale of principal residence 7a7 ,in general ,section #aba7;b7 is amended-- 7#a7 by striking #bej1jjj and inserting #ejj1jjj each place it appears1 7#b7 by striking #ejj1jjj and inserting #a1jjj1jjj each place it appears1 7#c7 in paragraph 7#b77;,a71 in the heading1 by striking #ejj1jjj and inserting #a1jjj1jjj1 and 7#d7 by adding at the end the following new paragraph3 7#e7 ,adjustment for inflation ,in the case of a taxable year beginning after #bjbf1 the #ejj1jjj and #a1jjj1jjj amounts in paragraphs 7#a71 7#b71 and 7#d7 shall be increased by an amount equal to-- 7,a7 such dollar amount1 multiplied by 7,b7 the cost-of-living adjustment determined under section #a7;f77#c7 for the calendar year in which the taxable year begins1 determined by substituting #bjbe for #bjaf in subparagraph 7,a77ii7 thereof4 ,if any increase under this clause is not a multiple of #ajj1 such increase shall be rounded to the next lowest multiple of #ajj4 4 7b7 ,effective date ,the amendments made by this section shall apply to sales and exchanges after ,december #ca1 #bjbe4 #abjje4 ,middle-income housing tax credit 7a7 ,in general ,subpart ,d of part ,,iv of subchapter ,a of chapter #a is amended by inserting after section #db the following new section3 #db;,a4 ,middle-income housing credit 7a7 ,in general ,for purposes of section #ch1 the amount of the middle-income housing credit determined under this section for any taxable year in the credit period shall be an amount equal to-- 7#a7 the applicable percentage1 of 7#b7 the qualified basis of each qualified middle-income building4 7b7 ,applicable percentage 7#a7 ,determination of applicable percentage ,for purposes of this section-- 7,a7 ,in general ,the term applicable percentage means1 with respect to any building1 the appropriate percentage prescribed by the ,secretary for the earlier of-- 7i7 the month in which such building is placed in service1 or 7ii7 at the election of the taxpayer1 the month in which the taxpayer and the housing credit agency enter into an agreement with respect to such building 7which is binding on such agency1 the taxpayer1 and all successors in interest7 as to the housing credit dollar amount to be allocated to such building4 ,a month may be elected under clause 7ii7 only if the election is made not later than the #eth day after the close of such month4 ,such an election1 once made1 shall be irrevocable4 7,b7 ,method of prescribing percentages ,the percentages prescribed by the ,secretary for any month shall be percentages which will yield over a #ae-year period amounts of credit under subsection 7a7 which have a present value equal to-- 7i7 #ej percent of the qualified basis of a new building which is not ,federally subsidized for the taxable year1 and 7ii7 #bj percent of the qualified basis of a building not described in clause 7i74 7,c7 ,method of discounting ,the present value under subparagraph 7,b7 shall be determined-- 7i7 as of the last day of the #ast year of the #ae-year period referred to in subparagraph 7,b71 7ii7 by using a discount rate equal to #gb percent of the average of the annual ,federal mid-term rate and the annual ,federal long-term rate applicable under section #abgd7;d77#a7 to the month applicable under clause 7i7 or 7ii7 of subparagraph 7,a7 and compounded annually1 and 7iii7 by assuming that the credit allowable under this section for any year is received on the last day of such year4 7#b7 ,minimum credit rate 7,a7 ,in general ,the applicable percentage for any building which is not ,federally subsidized for the taxable year shall not be less than #e percent4 7,b7 ,minimum credit rate for ,federally subsidized buildings ,in the case of any building to which subparagraph 7,a7 does not apply1 except as provided in paragraph 7#c71 the applicable percentage shall not be less than #b percent4 7#c7 ,exception for certain ,federally subsidized buildings ,in the case of any building to which paragraph 7#b77;,a7 does not apply1 the applicable percentage is zero unless-- 7,a7 a credit is allowed under section #db with respect to such building for the taxable year1 and 7,b7 such building is financed by tax-exempt bonds as described in section #db7;h77#d74 7#d7 ,cross references 7,a7 ,for treatment of certain rehabilitation expenditures as separate new buildings1 see subsection 7e74 7,b7 ,for determination of applicable percentage for increases in qualified basis after the #ast year of the credit period1 see subsection 7f77#c74 7,c7 ,for authority of housing credit agency to limit applicable percentage and qualified basis which may be taken into account under this section with respect to any building1 see subsection 7h77#f74 7c7 ,qualified basis2 qualified middle-,income building ,for purposes of this section-- 7#a7 ,qualified basis 7,a7 ,determination ,the qualified basis of any qualified middle-income building for any taxable year is an amount equal to-- 7i7 the applicable fraction 7determined as of the close of such taxable year7 of 7ii7 the eligible basis of such building 7determined under subsection 7d774 7,b7 ,applicable fraction ,for purposes of subparagraph 7,a71 the term applicable fraction means the smaller of the unit fraction or the floor space fraction4 7,c7 ,unit fraction ,for purposes of subparagraph 7,b71 the term unit fraction means the fraction-- 7i7 the numerator of which is the number of middle-income units in the building1 and 7ii7 the denominator of which is the number of residential rental units 7whether or not occupied7 in such building4 7,d7 ,floor space fraction ,for purposes of subparagraph 7,b71 the term floor space fraction means the fraction-- 7i7 the numerator of which is the total floor space of the middle-income units in such building1 and 7ii7 the denominator of which is the total floor space of the residential rental units 7whether or not occupied7 in such building4 7#b7 ,qualified middle-income building ,the term qualified middle-income building means any building which is part of a qualified middle-income housing project at all times during the period-- 7,a7 beginning on the #ast day in the credit period on which such building is part of such a project1 and 7,b7 ending on the last day of the credit period with respect to such building4 7d7 ,eligible basis ,for purposes of this section-- 7#a7 ,new buildings ,the eligible basis of a new building is its adjusted basis as of the close of the #ast taxable year of the credit period4 7#b7 ,existing buildings 7,a7 ,in general ,the eligible basis of an existing building is-- 7i7 in the case of a building which meets the requirements of subparagraph 7,b71 its adjusted basis as of the close of the #ast taxable year of the credit period1 and 7ii7 zero in any other case4 7,b7 ,requirements ,a building meets the requirements of this subparagraph if-- 7i7 the building is acquired by purchase 7as defined in section #agi7;d77#b771 7ii7 there is a period of at least #aj years between the date of its acquisition by the taxpayer and the date the building was last placed in service1 7iii7 the building was not previously placed in service by the taxpayer or by any person who was a related person with respect to the taxpayer as of the time previously placed in service1 and 7iv7 except as provided in subsection 7f77#e71 a credit is allowable under subsection 7a7 by reason of subsection 7e7 with respect to the building4 7,c7 ,adjusted basis ,for purposes of subparagraph 7,a71 the adjusted basis of any building shall not include so much of the basis of such building as is determined by reference to the basis of other property held at any time by the person acquiring the building4 7,d7 ,special rules 7i7 ,special rules for certain transfers ,for purposes of determining under subparagraph 7,b77ii7 when a building was last placed in service1 there shall not be taken into account any placement in service-- 7,i7 in connection with the acquisition of the building in a transaction in which the basis of the building in the hands of the person acquiring it is determined in whole or in part by reference to the adjusted basis of such building in the hands of the person from whom acquired1 7,,ii7 by a person whose basis in such building is determined under section #ajad7;a7 7relating to property acquired from a decedent71 7,,iii7 by any governmental unit or qualified nonprofit organization if the requirements of subparagraph 7,b77ii7 are met with respect to the placement in service by such unit or organization and all the income from such property is exempt from ,federal income taxation1 7,,iv7 by any person who acquired such building by foreclosure 7or by instrument in lieu of foreclosure7 of any purchase-money security interest held by such person if the requirements of subparagraph 7,b77ii7 are met with respect to the placement in service by such person and such building is resold within #ab months after the date such building is placed in service by such person after such foreclosure1 or 7,v7 of a single-family residence by any individual who owned and used such residence for no other purpose than as his principal residence4 7ii7 ,related person ,for purposes of subparagraph 7,b77iii71 a person 7hereinafter in this subclause referred to as the related person7 is related to any person if the related person bears a relationship to such person specified in section #bfg7;b7 or #gjg7;b77#a71 or the related person and such person are engaged in trades or businesses under common control 7within the meaning of subsections 7a7 and 7b7 of section #eb74 7#c7 ,special rules relating to determination of adjusted basis ,for purposes of this subsection-- 7,a7 ,in general ,except as provided in subparagraph 7,b71 the adjusted basis of any building shall be determined without regard to the adjusted basis of any property which is not residential rental property4 7,b7 ,basis of property in common areas1 etc41 included 7i7 ,in general ,except as provided in clause 7ii71 the adjusted basis of any building shall be determined by taking into account the adjusted basis of property 7of a character subject to the allowance for depreciation7 used in common areas or provided as comparable amenities to all residential rental units in such building4 7ii7 ,special rule ,in the case of any building for which the low-income housing tax credit is allowable under section #db1 the adjusted basis of the building under this section shall be determined without regard to property used in common areas or provided as comparable amenities to all residential rental units in such building4 7,c7 ,no reduction for depreciation ,the adjusted basis of any building shall be determined without regard to paragraphs 7#b7 and 7#c7 of section #ajaf7;a74 7#d7 ,special rules for determining eligible basis 7,a7 ,federal grants not taken into account in determining eligible basis ,the eligible basis of a building shall not include any costs financed with the proceeds of a ,federally funded grant4 7,b7 ,increase in credit for buildings in high cost areas 7i7 ,in general ,in the case of any building located in a difficult development area which is designated for purposes of this subparagraph-- 7,i7 in the case of a new building1 the eligible basis of such building shall be #acj percent of such basis determined without regard to this subparagraph1 and 7,,ii7 in the case of an existing building1 the rehabilitation expenditures taken into account under subsection 7e7 shall be #acj percent of such expenditures determined without regard to this subparagraph4 7ii7 ,limitation ,clause 7i7 shall not apply to any building if paragraph 7#a7 of subsection 7h7 does not apply to any portion of the eligible basis of such building by reason of paragraph 7#i7 of such subsection4 7iii7 ,difficult development areas 7,i7 ,in general ,the term difficult development areas means any area designated by the ,secretary of ,housing and ,urban ,development as an area which has high construction1 land1 or utility costs relative to area median gross income1 any rural area1 and any ,indian area4 7,,ii7 ,rural area ,for purposes of subclause 7,i71 the term rural area means any non-metropolitan area1 or any rural area as defined by section #ebj of the ,housing ,act of #aidi1 which is identified by the qualified allocation plan under subsection 7m77#a77;,b74 7,,iii7 ,indian area ,for purposes of subclause 7,i71 the term ,indian area means any ,indian area 7as defined in section #d7aa7 of the ,native ,american ,housing ,assistance and ,self ,determination ,act of #aiif 7#be ,u4,s4,c4 #dajc7aa7774 7,,iv7 ,special rule for buildings in ,indian areas ,in the case of an area which is a difficult development area solely because it is an ,indian area1 a building shall not be treated as located in such area unless such building is assisted or financed under the ,native ,american ,housing ,assistance and ,self ,determination ,act of #aiif 7#be ,u4,s4,c4 #daja et seq47 or the project sponsor is an ,indian tribe 7as defined in section #de;,a7c77#f771 a tribally designated housing entity 7as defined in section #d7bb7 of such ,act 7#be ,u4,s4,c4 #dajc7bb7771 or wholly owned or controlled by such an ,indian tribe or tribally designated housing entity4 7,v7 ,limit on areas designated ,the portions of metropolitan statistical areas which may be designated for purposes of this subparagraph shall not exceed an aggregate area having #bj percent of the population of such metropolitan statistical areas4 ,a comparable rule shall apply to nonmetropolitan areas4 7iv7 ,special rules and definitions ,for purposes of this subparagraph-- 7,i7 population shall be determined on the basis of the most recent decennial census for which data are available1 7,,ii7 area median gross income shall be determined in accordance with subsection 7g77#d71 7,,iii7 the term metropolitan statistical area has the same meaning as when used in section #adc7k77#b77;,b71 and 7,,iv7 the term nonmetropolitan area means any county 7or portion thereof7 which is not within a metropolitan statistical area4 7v7 ,buildings designated by ,state ,housing ,credit ,agency ,any building which is designated by the ,state housing credit agency as requiring the increase in credit under this subparagraph in order for such building to be financially feasible as part of a qualified middle-income housing project shall be treated for purposes of this subparagraph as located in a difficult development area which is designated for purposes of this subparagraph4 7#e7 ,credit allowable for certain buildings acquired during #aj-year period ,on application by the taxpayer1 the ,secretary may waive paragraph 7#b77;,b77ii7 with respect to any building acquired from an insured depository institution in default 7as defined in section #c of the ,federal ,deposit ,insurance ,act7 or from a receiver or conservator of such an institution4 7#f7 ,acquisition of building before end of prior credit period 7,a7 ,in general ,under regulations prescribed by the ,secretary1 in the case of a building described in subparagraph 7,b7 7or interest therein7 which is acquired by the taxpayer-- 7i7 paragraph 7#b77;,b7 shall not apply1 but 7ii7 the credit allowable by reason of subsection 7a7 to the taxpayer for any period after such acquisition shall be equal to the amount of credit which would have been allowable under subsection 7a7 for such period to the prior owner referred to in subparagraph 7,b7 had such owner not disposed of the building4 7,b7 ,description of building ,a building is described in this subparagraph if-- 7i7 a credit was allowed by reason of subsection 7a7 to any prior owner of such building1 and 7ii7 the taxpayer acquired such building before the end of the credit period for such building with respect to such prior owner 7determined without regard to any disposition by such prior owner74 7e7 ,rehabilitation expenditures treated as separate new building 7#a7 ,in general ,rehabilitation expenditures paid or incurred by the taxpayer with respect to any building shall be treated for purposes of this section as a separate new building4 7#b7 ,rehabilitation expenditures ,for purposes of paragraph 7#a7-- 7,a7 ,in general ,the term rehabilitation expenditures means amounts chargeable to capital account and incurred for property 7or additions or improvements to property7 of a character subject to the allowance for depreciation in connection with the rehabilitation of a building4 7,b7 ,cost of acquisition1 etc41 not included ,such term does not include the cost of acquiring any building 7or interest therein7 or any amount not permitted to be taken into account under paragraph 7#c7 of subsection 7d74 7,c7 ,certain relocation costs ,in the case of a rehabilitation of a building to which section #bhj;,b does not apply1 costs relating to the relocation of occupants1 including-- 7i7 amounts paid to occupants1 7ii7 amounts paid to third parties for services relating to such relocation1 and 7iii7 amounts paid for temporary housing for occupants1 shall be treated as chargeable to capital account and taken into account as rehabilitation expenditures4 7#c7 ,minimum expenditures to qualify 7,a7 ,in general ,paragraph 7#a7 shall apply to rehabilitation expenditures with respect to any building only if-- 7i7 the expenditures are allocable to #a or more middle-income units or substantially benefit such units1 and 7ii7 the amount of such expenditures during any #bd-month period meets the requirements of whichever of the following subclauses requires the greater amount of such expenditures3 7,i7 ,the requirement of this subclause is met if such amount is not less than #bj percent of the adjusted basis of the building 7determined as of the #ast day of such period and without regard to paragraphs 7#b7 and 7#c7 of section #ajaf7;a774 7,,ii7 ,the requirement of this subclause is met if the qualified basis attributable to such amount1 when divided by the number of middle-income units in the building1 is equal to or greater than the dollar amount in effect under section #db7;e77#c77;,a77ii77,,ii7 for the calendar year in which such expenditures are treated as placed in service under paragraph 7#d74 7,b7 ,date of determination ,the determination under subparagraph 7,a7 shall be made as of the close of the #ast taxable year in the credit period with respect to such expenditures4 7#d7 ,special rules ,for purposes of applying this section with respect to expenditures which are treated as a separate building by reason of this subsection-- 7,a7 such expenditures shall be treated as placed in service at the close of the #bd-month period referred to in paragraph 7#c77;,a71 and 7,b7 the applicable fraction under subsection 7c77#a7 shall be the applicable fraction for the building 7without regard to paragraph 7#a77 with respect to which the expenditures were incurred4 ,nothing in subsection 7d77#b7 shall prevent a credit from being allowed by reason of this subsection4 7#e7 ,no double counting ,rehabilitation expenditures may1 at the election of the taxpayer1 be taken into account under this subsection or subsection 7d77#b77;,a77i7 but not under both such subsections4 7#f7 ,regulations to apply subsection with respect to group of units in building ,the ,secretary may prescribe regulations1 consistent with the purposes of this subsection1 treating a group of units with respect to which rehabilitation expenditures are incurred as a separate new building4 7f7 ,definition and special rules relating to credit period 7#a7 ,credit period defined ,for purposes of this section1 the term credit period means1 with respect to any building1 the period of #ae taxable years beginning with-- 7,a7 the taxable year in which the building is placed in service1 or 7,b7 at the election of the taxpayer1 the succeeding taxable year1 but only if the building is a qualified middle-income building as of the close of the #ast year of such period4 ,the election under subparagraph 7,b71 once made1 shall be irrevocable4 7#b7 ,special rule for #ast year of credit period 7,a7 ,in general ,the credit allowable under subsection 7a7 with respect to any building for the #ast taxable year of the credit period shall be determined by substituting for the applicable fraction under subsection 7c77#a7 the fraction-- 7i7 the numerator of which is the sum of the applicable fractions determined under subsection 7c77#a7 as of the close of each full month of such year during which such building was in service1 and 7ii7 the denominator of which is #ab4 7,b7 ,disallowed #ast-year credit allowed in #afth year ,any reduction by reason of subparagraph 7,a7 in the credit allowable 7without regard to subparagraph 7,a77 for the #ast taxable year of the credit period shall be allowable under subsection 7a7 for the #ast taxable year following the credit period4 7#c7 ,determination of applicable percentage with respect to increases in qualified basis after #ast year of credit period 7,a7 ,in general ,in the case of any building which was a qualified middle-income building as of the close of the #ast year of the credit period1 if-- 7i7 as of the close of any taxable year in the credit period 7after the #ast year of such period7 the qualified basis of such building1 exceeds 7ii7 the qualified basis of such building as of the close of the #ast year of the credit period1 the applicable percentage which shall apply under subsection 7a7 for the taxable year to such excess shall be the percentage equal to #b_/c of the applicable percentage which 7after the application of subsection 7h77 would but for this paragraph apply to such basis4 7,b7 #ast year computation applies ,a rule similar to the rule of paragraph 7#b77;,a7 shall apply to any increase in qualified basis to which subparagraph 7,a7 applies for the #ast year of such increase4 7#d7 ,dispositions of property ,if a building 7or an interest therein7 is disposed of during any year for which credit is allowable under subsection 7a71 such credit shall be allocated between the parties on the basis of the number of days during such year the building 7or interest7 was held by each4 7#e7 ,credit period for existing buildings not to begin before rehabilitation credit allowed 7,a7 ,in general ,the credit period for an existing building shall not begin before the #ast taxable year of the credit period for rehabilitation expenditures with respect to the building4 7,b7 ,acquisition credit allowed for certain buildings not allowed a rehabilitation credit 7i7 ,in general ,in the case of a building described in clause 7ii7-- 7,i7 subsection 7d77#b77;,b77iv7 shall not apply1 and 7,,ii7 the credit period for such building shall not begin before the taxable year which would be the #ast taxable year of the credit period for rehabilitation expenditures with respect to the building under the modifications described in clause 7ii77,,ii74 7ii7 ,building described ,a building is described in this clause if-- 7,i7 a waiver is granted under subsection 7d77#d7 with respect to the acquisition of the building1 and 7,,ii7 a credit would be allowed for rehabilitation expenditures with respect to such building if subsection 7e77#c77;,a77ii77,i7 did not apply and if the dollar amount in effect under subsection 7e77#c77;,a77ii77,,ii7 were two-thirds of such amount4 7g7 ,qualified middle-,income housing project ,for purposes of this section-- 7#a7 ,in general ,the term qualified middle-income housing project means any project for residential rental property if-- 7,a7 #fj percent or more of the residential units in such project are both rent-restricted and occupied by individuals whose income is #ajj percent or less of area median gross income1 and 7,b7 not less than #bj percent of the residential units in such project are units which-- 7i7 are described in subparagraph 7,a71 and 7ii7 are not residential units which are taken into account under section #db4 7#b7 ,rent-restricted units 7,a7 ,in general ,for purposes of paragraph 7#a71 a residential unit is rent-restricted if the gross rent with respect to such unit does not exceed #cj percent of the imputed income limitation applicable to such unit4 ,for purposes of the preceding sentence1 the amount of the income limitation under paragraph 7#a7 applicable for any period shall not be less than such limitation applicable for the earliest period the building 7which contains the unit7 was included in the determination of whether the project is a qualified middle-income housing project4 7,b7 ,gross rent ,for purposes of subparagraph 7,a71 gross rent-- 7i7 includes any utility allowance determined by the ,secretary after taking into account such determinations under section #h of the ,united ,states ,housing ,act of #aicg1 7ii7 does not include any fee for a supportive service which is paid to the owner of the unit 7on the basis of the middle-income status of the tenant of the unit7 by any governmental program of assistance 7or by an organization described in section #eja7;c77#c7 and exempt from tax under section #eja7;a77 if such program 7or organization7 provides assistance for rent and the amount of assistance provided for rent is not separable from the amount of assistance provided for supportive services1 and 7iii7 does not include any rental payment to the owner of the unit to the extent such owner pays an equivalent amount to the ,farmers' ,home ,administration under section #eae of the ,housing ,act of #aidi4 ,for purposes of clause 7ii71 the term supportive service means any service provided under a planned program of services designed to enable residents of a residential rental property to remain independent and avoid placement in a hospital1 nursing home1 or intermediate care facility for the mentally or physically handicapped4 7,c7 ,imputed income limitation applicable to unit ,for purposes of this paragraph1 the imputed income limitation applicable to a unit is the income limitation which would apply under paragraph 7#a7 to individuals occupying the unit if the number of individuals occupying the unit were as follows3 7i7 ,in the case of a unit which does not have a separate bedroom1 #a individual4 7ii7 ,in the case of a unit which has #a or more separate bedrooms1 #a4e individuals for each separate bedroom4 ,in the case of a project with respect to which a credit is allowable by reason of this section and for which financing is provided by a bond described in section #adb7;a77#g71 the imputed income limitation shall apply in lieu of the otherwise applicable income limitation for purposes of applying section #adb7;d77#d77;,b77ii74 7,d7 ,treatment of units occupied by individuals whose incomes rise above limit 7i7 ,in general ,except as provided in clause 7ii71 notwithstanding an increase in the income of the occupants of a middle-income unit above the income limitation applicable under paragraph 7#a71 such unit shall continue to be treated as a middle-income unit if the income of such occupants initially met such income limitation and such unit continues to be rent-restricted4 7ii7 ,next available unit must be rented to middle-income tenant if income rises above #adj percent of income limit ,if the income of the occupants of the unit increases above #adj percent of the income limitation applicable under paragraph 7#a71 clause 7i7 shall cease to apply to such unit if any residential rental unit in the building 7of a size comparable to1 or smaller than1 such unit7 is occupied by a new resident whose income exceeds such income limitation4 7#c7 ,date for meeting requirements 7,a7 ,in general ,except as otherwise provided in this paragraph1 a building shall be treated as a qualified middle-income building only if the project 7of which such building is a part7 meets the requirements of paragraph 7#a7 not later than the close of the #ast year of the credit period for such building4 7,b7 ,buildings which rely on later buildings for qualification 7i7 ,in general ,in determining whether a building 7hereinafter in this subparagraph referred to as the prior building7 is a qualified middle-income building1 the taxpayer may take into account #a or more additional buildings placed in service during the #ab-month period described in subparagraph 7,a7 with respect to the prior building only if the taxpayer elects to apply clause 7ii7 with respect to each additional building taken into account4 7ii7 ,treatment of elected buildings ,in the case of a building which the taxpayer elects to take into account under clause 7i71 the period under subparagraph 7,a7 for such building shall end at the close of the #ab-month period applicable to the prior building4 7iii7 ,date prior building is treated as placed in service ,for purposes of determining the credit period for the prior building1 the prior building shall be treated for purposes of this section as placed in service on the most recent date any additional building elected by the taxpayer 7with respect to such prior building7 was placed in service4 7,c7 ,special rule ,a building-- 7i7 other than the #ast building placed in service as part of a project1 and 7ii7 other than a building which is placed in service during the #ab-month period described in subparagraph 7,a7 with respect to a prior building which becomes a qualified middle-income building1 shall in no event be treated as a qualified middle-income building unless the project is a qualified middle-income housing project 7without regard to such building7 on the date such building is placed in service4 7,d7 ,projects with more than #a building must be identified ,for purposes of this section1 a project shall be treated as consisting of only #a building unless1 before the close of the #ast calendar year in the project period 7as defined in subsection 7h77#a77;,f77ii771 each building which is 7or will be7 part of such project is identified in such form and manner as the ,secretary may provide4 7#d7 ,certain rules made applicable ,paragraphs 7#b7 7other than subparagraph 7,a7 thereof71 7#c71 and 7#g7 of section #adb7;d71 and section #ffeb7;j71 shall apply for purposes of determining whether any project is a qualified middle-income housing project and whether any unit is a middle-income unit2 except that1 in applying such provisions for such purposes-- 7,a7 the term gross rent shall have the meaning given such term by paragraph 7#b77;,b7 of this subsection1 and 7,b7 the term applicable income limit means the limitation under paragraph 7#a7 of this subsection4 7#e7 ,election to treat building after credit period as not part of a project ,for purposes of this section1 the taxpayer may elect to treat any building as not part of a qualified middle-income housing project for any period beginning after the credit period for such building4 7#f7 ,special rule where de minimis equity contribution ,property shall not be treated as failing to be residential rental property for purposes of this section merely because the occupant of a residential unit in the project pays 7on a voluntary basis7 to the lessor a de minimis amount to be held toward the purchase by such occupant of a residential unit in such project if-- 7,a7 all amounts so paid are refunded to the occupant on the cessation of his occupancy of a unit in the project1 and 7,b7 the purchase of the unit is not permitted until after the close of the credit period with respect to the building in which the unit is located4 ,any amount paid to the lessor as described in the preceding sentence shall be included in gross rent under paragraph 7#b7 for purposes of determining whether the unit is rent-restricted4 7#g7 ,scattered site projects ,buildings which would 7but for their lack of proximity7 be treated as a project for purposes of this section shall be so treated if all of the dwelling units in each of the buildings are rent-restricted 7within the meaning of paragraph 7#b77 residential rental units4 7#h7 ,waiver of certain recertifications ,on application by the taxpayer1 the ,secretary may waive any annual recertification of tenant income for purposes of this subsection1 if the entire building is occupied by middle-income tenants4 7#i7 ,clarification of general public use requirement ,a project does not fail to meet the general public use requirement solely because of occupancy restrictions or preferences that favor tenants-- 7,a7 with special needs1 or 7,b7 who are members of a specified group under a ,federal program or ,state program or policy that supports housing for such a specified group4 7h7 ,limitation on aggregate credit allowable with respect to projects located in a ,state 7#a7 ,credit may not exceed credit amount allocated to building 7,a7 ,in general ,the amount of the credit determined under this section for any taxable year with respect to any building shall not exceed the housing credit dollar amount allocated to such building under this subsection4 7,b7 ,time for making allocation ,except in the case of an allocation which meets the requirements of subparagraph 7,c71 7,d71 7,e71 or 7,f71 an allocation shall be taken into account under subparagraph 7,a7 only if it is made not later than the close of the calendar year in which the building is placed in service4 7,c7 ,exception where binding commitment ,an allocation meets the requirements of this subparagraph if there is a binding commitment 7not later than the close of the calendar year in which the building is placed in service7 by the housing credit agency to allocate a specified housing credit dollar amount to such building beginning in a specified later taxable year4 7,d7 ,exception where increase in qualified basis 7i7 ,in general ,an allocation meets the requirements of this subparagraph if such allocation is made not later than the close of the calendar year in which ends the taxable year to which it will #ast apply but only to the extent the amount of such allocation does not exceed the limitation under clause 7ii74 7ii7 ,limitation ,the limitation under this clause is the amount of credit allowable under this section 7without regard to this subsection7 for a taxable year with respect to an increase in the qualified basis of the building equal to the excess of-- 7,i7 the qualified basis of such building as of the close of the #ast taxable year to which such allocation will apply1 over 7,,ii7 the qualified basis of such building as of the close of the #ast taxable year to which the most recent prior housing credit allocation with respect to such building applied4 7iii7 ,housing credit dollar amount reduced by full allocation ,notwithstanding clause 7i71 the full amount of the allocation shall be taken into account under paragraph 7#b74 7,e7 ,exception where #aj percent of cost incurred 7i7 ,in general ,an allocation meets the requirements of this subparagraph if such allocation is made with respect to a qualified building which is placed in service not later than the close of the second calendar year following the calendar year in which the allocation is made4 7ii7 ,qualified building ,for purposes of clause 7i71 the term qualified building means any building which is part of a project if the taxpayer's basis in such project 7as of the date which is #a year after the date that the allocation was made7 is more than #aj percent of the taxpayer's reasonably expected basis in such project 7as of the close of the second calendar year referred to in clause 7i774 ,such term does not include any existing building unless a credit is allowable under subsection 7e7 for rehabilitation expenditures paid or incurred by the taxpayer with respect to such building for a taxable year ending during the second calendar year referred to in clause 7i7 or the prior taxable year4 7,f7 ,allocation of credit on a project basis 7i7 ,in general ,in the case of a project which includes 7or will include7 more than #a building1 an allocation meets the requirements of this subparagraph if-- 7,i7 the allocation is made to the project for a calendar year during the project period1 7,,ii7 the allocation only applies to buildings placed in service during or after the calendar year for which the allocation is made1 and 7,,iii7 the portion of such allocation which is allocated to any building in such project is specified not later than the close of the calendar year in which the building is placed in service4 7ii7 ,project period ,for purposes of clause 7i71 the term project period means the period-- 7,i7 beginning with the #ast calendar year for which an allocation may be made for the #ast building placed in service as part of such project1 and 7,,ii7 ending with the calendar year the last building is placed in service as part of such project4 7#b7 ,allocated credit amount to apply to all taxable years ending during or after credit allocation year ,any housing credit dollar amount allocated to any building for any calendar year-- 7,a7 shall apply to such building for all taxable years in the credit period ending during or after such calendar year1 and 7,b7 shall reduce the aggregate housing credit dollar amount of the allocating agency only for such calendar year4 7#c7 ,housing credit dollar amount for agencies 7,a7 ,in general ,the aggregate housing credit dollar amount which a housing credit agency may allocate for any calendar year is the portion of the ,state housing credit ceiling allocated under this paragraph for such calendar year to such agency4 7,b7 ,state ceiling initially allocated to ,state housing credit agencies ,except as provided in subparagraph 7,d71 the ,state housing credit ceiling for each calendar year shall be allocated to the housing credit agency of such ,state4 ,if there is more than #a housing credit agency of a ,state1 all such agencies shall be treated as a single agency4 7,c7 ,state housing credit ceiling ,the ,state housing credit ceiling applicable to any ,state for any calendar year shall be an amount equal to the sum of-- 7i7 the unused ,state housing credit ceiling 7if any7 of such ,state for the preceding calendar year1 7ii7 the greater of-- 7,i7 #a4jj multiplied by the ,state population1 or 7,,ii7 #a1ejj1jjj1 plus 7iii7 the amount of ,state housing credit ceiling returned in the calendar year4 ,for purposes of clause 7i71 the unused ,state housing credit ceiling for any calendar year is the excess 7if any7 of the sum of the amounts described in clauses 7ii7 7reduced by the aggregate amounts described in paragraph 7#aj77;,a77i7 with respect to all elections made for such calendar year7 and 7iii7 over the aggregate housing credit dollar amount allocated for such year4 ,for purposes of clause 7iii71 the amount of ,state housing credit ceiling returned in the calendar year equals the housing credit dollar amount previously allocated within the ,state to any project which fails to meet the #aj percent test under paragraph 7#a77;,e77ii7 on a date after the close of the calendar year in which the allocation was made or which does not become a qualified middle-income housing project within the period required by this section or the terms of the allocation or to any project with respect to which an allocation is cancelled by mutual consent of the housing credit agency and the allocation recipient4 7,d7 ,state may provide for different allocation ,rules similar to the rules of section #adf7;e7 7other than paragraph 7#b77;,b7 thereof7 shall apply for purposes of this paragraph4 7,e7 ,population ,for purposes of this paragraph1 population shall be determined in accordance with section #adf7;j74 7,f7 ,cost-of-living adjustment 7i7 ,in general ,in the case of a calendar year after #bjbf1 the #a1ejj1jjj and #a4jj amounts in subparagraph 7,c7 shall each be increased by an amount equal to-- 7,i7 such dollar amount1 multiplied by 7,,ii7 the cost-of-living adjustment determined under section #a7;f77#c7 for such calendar year by substituting calendar year #bjbe for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 7ii7 ,rounding 7,i7 ,in the case of the #a1adj1jjj amount1 any increase under clause 7i7 which is not a multiple of #e1jjj shall be rounded to the next lowest multiple of #e1jjj4 7,,ii7 ,in the case of the #a4jj amount1 any increase under clause 7i7 which is not a multiple of #e cents shall be rounded to the next lowest multiple of #e cents4 7#d7 ,portion of ,state ceiling set-aside for certain projects involving qualified nonprofit organizations 7,a7 ,in general ,not more than #ij percent of the ,state housing credit ceiling 7determined without regard to paragraph 7#g77 for any ,state for any calendar year shall be allocated to projects other than qualified middle-income housing projects described in subparagraph 7,b74 7,b7 ,projects involving qualified nonprofit organizations ,for purposes of subparagraph 7,a71 a qualified middle-income housing project is described in this subparagraph if a qualified nonprofit organization is to own an interest in the project 7directly or through a partnership7 and materially participate 7within the meaning of section #dfi7;h77 in the development and operation of the project throughout the credit period4 7,c7 ,qualified nonprofit organization ,for purposes of this paragraph1 the term qualified nonprofit organization means any organization if-- 7i7 such organization is described in paragraph 7#c7 or 7#d7 of section #eja7;c7 and is exempt from tax under section #eja7;a71 7ii7 such organization is determined by the ,state housing credit agency not to be affiliated with or controlled by a for-profit organization1 and 7iii7 one of the exempt purposes of such organization includes the fostering of middle-income housing4 7,d7 ,treatment of certain subsidiaries 7i7 ,in general ,for purposes of this paragraph1 a qualified nonprofit organization shall be treated as satisfying the ownership and material participation test of subparagraph 7,b7 if any qualified corporation in which such organization holds stock satisfies such test4 7ii7 ,qualified corporation ,for purposes of clause 7i71 the term qualified corporation means any corporation if #ajj percent of the stock of such corporation is held by #a or more qualified nonprofit organizations at all times during the period such corporation is in existence4 7,e7 ,state may not override set-aside ,nothing in subparagraph 7,e7 of paragraph 7#c7 shall be construed to permit a ,state not to comply with subparagraph 7,a7 of this paragraph4 7#e7 ,buildings eligible for credit only if minimum long-term commitment to middle-income housing 7,a7 ,in general ,no credit shall be allowed by reason of this section with respect to any building for the taxable year unless an extended middle-income housing commitment is in effect as of the end of such taxable year4 7,b7 ,extended middle-income housing commitment ,for purposes of this paragraph1 the term extended middle-income housing commitment means any agreement between the taxpayer and the housing credit agency-- 7i7 which requires that the applicable fraction 7as defined in subsection 7c77#a77 for the building for each taxable year in the extended use period will not be less than the applicable fraction specified in such agreement and which prohibits the actions described in subclauses 7,i7 and 7,,ii7 of subparagraph 7,e77ii71 7ii7 which allows individuals who meet the income limitation applicable to the building under subsection 7g7 7whether prospective1 present1 or former occupants of the building7 the right to enforce in any ,state court the requirement and prohibitions of clause 7i71 7iii7 which prohibits the disposition to any person of any portion of the building to which such agreement applies unless all of the building to which such agreement applies is disposed of to such person1 7iv7 which prohibits the refusal to lease to a holder of a voucher or certificate of eligibility under section #h of the ,united ,states ,housing ,act of #aicg because of the status of the prospective tenant as such a holder1 7v7 which is binding on all successors of the taxpayer1 and 7vi7 which1 with respect to the property1 is recorded pursuant to ,state law as a restrictive covenant4 7,c7 ,allocation of credit may not exceed amount necessary to support commitment ,the housing credit dollar amount allocated to any building may not exceed the amount necessary to support the applicable fraction specified in the extended middle-income housing commitment for such building1 including any increase in such fraction pursuant to the application of subsection 7f77#c7 if such increase is reflected in an amended middle-income housing commitment4 7,d7 ,extended use period ,for purposes of this paragraph1 the term extended use period means the period-- 7i7 beginning on the #ast day in the credit period on which such building is part of a qualified middle-income housing project1 and 7ii7 ending on the later of-- 7,i7 the date specified by such agency in such agreement1 or 7,,ii7 the date which is #ae years after the close of the credit period4 7,e7 ,exceptions if foreclosure or if no buyer willing to maintain middle-income status 7i7 ,in general ,the extended use period for any building shall terminate on the #fast day after the taxpayer 7or a successor in interest7 provides notice to the ,secretary and the housing credit agency that the building has been acquired by foreclosure 7or instrument in lieu of foreclosure7 and that the taxpayer intends the termination of such period1 unless1 before such date1 the ,secretary or the housing credit agency determines that such acquisition is part of an arrangement with the taxpayer a purpose of which is to terminate such period4 7ii7 ,eviction1 etc41 of existing middle-income tenants not permitted ,the termination of an extended use period under clause 7i7 shall not be construed to permit before the close of the #c-year period following such termination-- 7,i7 the eviction or the termination of tenancy 7other than for good cause7 of an existing tenant of any middle-income unit1 or 7,,ii7 any increase in the gross rent with respect to such unit not otherwise permitted under this section4 7,f7 ,effect of noncompliance ,if1 during a taxable year1 there is a determination that an extended middle-income housing agreement was not in effect as of the beginning of such year1 such determination shall not apply to any period before such year and subparagraph 7,a7 shall be applied without regard to such determination if the failure is corrected within #a year from the date of the determination4 7,g7 ,projects which consist of more than #a building ,the application of this paragraph to projects which consist of more than #a building shall be made under regulations prescribed by the ,secretary4 7#f7 ,special rules 7,a7 ,building must be located within jurisdiction of credit agency ,a housing credit agency may allocate its aggregate housing credit dollar amount only to buildings located in the jurisdiction of the governmental unit of which such agency is a part4 7,b7 ,agency allocations in excess of limit ,if the aggregate housing credit dollar amounts allocated by a housing credit agency for any calendar year exceed the portion of the ,state housing credit ceiling allocated to such agency for such calendar year1 the housing credit dollar amounts so allocated shall be reduced 7to the extent of such excess7 for buildings in the reverse of the order in which the allocations of such amounts were made4 7,c7 ,credit reduced if allocated credit dollar amount is less than credit which would be allowable without regard to placed in service convention1 etc 7i7 ,in general ,the amount of the credit determined under this section with respect to any building shall not exceed the clause 7ii7 percentage of the amount of the credit which would 7but for this subparagraph7 be determined under this section with respect to such building4 7ii7 ,determination of percentage ,for purposes of clause 7i71 the clause 7ii7 percentage with respect to any building is the percentage which-- 7,i7 the housing credit dollar amount allocated to such building1 bears to 7,,ii7 the credit amount determined in accordance with clause 7iii74 7iii7 ,determination of credit amount ,the credit amount determined in accordance with this clause is the amount of the credit which would 7but for this subparagraph7 be determined under this section with respect to the building if-- 7,i7 this section were applied without regard to paragraphs 7#b77;,a7 and 7#c77;,b7 of subsection 7f71 and 7,,ii7 subsection 7f77#c77;,a7 were applied without regard to the percentage equal to #b_/c of4 7,d7 ,housing credit agency to specify applicable percentage and maximum qualified basis ,in allocating a housing credit dollar amount to any building1 the housing credit agency shall specify the applicable percentage and the maximum qualified basis which may be taken into account under this section with respect to such building4 ,the applicable percentage and maximum qualified basis so specified shall not exceed the applicable percentage and qualified basis determined under this section without regard to this subsection4 7#g7 ,increase in ,state ceiling dedicated to certain rural development projects 7,a7 ,in general ,the ,state housing credit ceiling for any calendar year shall be increased by an amount equal to #e percent of the amount determined under paragraph 7#c77;,c77ii74 7,b7 ,use of increased amount 7i7 ,in general ,the amount of the increase under subparagraph 7,a7 for any calendar year may only be allocated to buildings located in a rural area4 7ii7 ,rural area ,for purposes of clause 7i71 the term rural area means any non-metropolitan area1 or any rural area as defined by section #ebj of the ,housing ,act of #aidi1 which is identified by the qualified allocation plan under subsection 7l77#a77;,b74 7#h7 ,other definitions ,for purposes of this subsection-- 7,a7 ,housing credit agency ,the term housing credit agency means any agency authorized to carry out this subsection4 7,b7 ,possessions treated as ,states ,the term ,state includes a possession of the ,united ,states4 7#i7 ,credit for buildings financed by tax-exempt bonds subject to volume cap not taken into account ,rules similar to the rules of subsections 7h77#d71 7m77#a77;,d71 and 7m77#b77;,d7 of section #db shall apply for purposes of this subsection4 7#aj7 ,election to transfer ,state housing credit ceiling for allocations to low-income buildings 7,a7 ,in general ,if a ,state housing credit agency makes an election under this paragraph with respect to a calendar year-- 7i7 the ,state housing credit ceiling for such calendar year under paragraph 7#c7 7determined before application of paragraph 7#g77 shall be reduced by the amount specified in such election1 7ii7 the amount determined under paragraph 7#g7 for such calendar year shall be reduced by the amount specified in such election1 and 7iii7 the amount determined under section #db7;h77#c77;,c77ii7 for such calendar year shall be increased by the sum of the amounts specified in clauses 7i7 and 7ii71 except that any amount specified under clause 7ii7-- 7,i7 may only be allocated under such section to qualified low-income buildings 7as defined in section #db7 located in a rural area 7as defined in paragraph 7#g771 and 7,,ii7 shall not be taken into account for purposes of determining the unused housing credit ceiling under the second sentence of section #db7;h77#c77;,c74 7,b7 ,time and manner for making election 7i7 ,in general ,an election under this paragraph-- 7,i7 shall be made before the end of the calendar year with respect to which such election applies1 7,,ii7 shall be made in such manner as specified by the ,secretary1 and 7,,iii7 shall separately specify the amount of reductions to be made under paragraph 7#c7 and paragraph 7#g74 7ii7 ,frequency ,a ,state housing credit agency may make more than one election under this section with respect to any calendar year1 and any such election1 once made1 shall be revocable only if such revocation is made before the end of the calendar year with respect to which such election is made4 7,c7 ,limitation ,the aggregate amount specified in elections under this paragraph with respect to any ,state housing credit agency for calendar year shall not exceed the sum of-- 7i7 the amount determined under paragraph 7#c77;,c77ii7 for such calendar year1 plus 7ii7 the amount determined under paragraph 7#g7 for such calendar year4 7i7 ,definitions and special rules ,for purposes of this section-- 7#a7 ,middle-income unit 7,a7 ,in general ,the term middle-income unit means any unit in a building if-- 7i7 such unit is rent-restricted 7as defined in subsection 7g77#b771 and 7ii7 the individuals occupying such unit meet the income limitation applicable under subsection 7g77#a7 to the project of which such building is a part4 7,b7 ,exceptions 7i7 ,exclusion of low-income units ,a unit shall not be treated as a middle-income unit if such unit is a low-income unit 7as defined under section #db7;i77#c774 7ii7 ,unit must be suitable for permanent occupancy 7,i7 ,in general ,a unit shall not be treated as a middle-income unit unless the unit is suitable for occupancy and used other than on a transient basis4 7,,ii7 ,suitability for occupancy ,for purposes of subclause 7,i71 the suitability of a unit for occupancy shall be determined under regulations prescribed by the ,secretary taking into account local health1 safety1 and building codes4 7,,iii7 ,single-room occupancy units ,for purposes of subclause 7,i71 a single-room occupancy unit shall not be treated as used on a transient basis merely because it is rented on a month-by-month basis4 7,c7 ,special rule for buildings having #d or fewer units ,in the case of any building which has #d or fewer residential rental units1 no unit in such building shall be treated as a middle-income unit if the units in such building are owned by-- 7i7 any individual who occupies a residential unit in such building1 or 7ii7 any person who is related 7as defined in subsection 7d77#b77;,d77ii77 to such individual4 7,d7 ,rules relating to students 7i7 ,in general ,a unit occupied solely by individuals who-- 7,i7 have not attained age #bd1 and 7,,ii7 are enrolled in a full-time course of study at an institution of higher education 7as defined in section #ccjd7;f771 shall not be treated as a middle-income unit4 7ii7 ,exception for certain federal programs ,in the case of a ,federally-assisted building 7as defined in subsection 7d77#f77;,c77i7 of section #db71 clause 7i7 shall not apply to a unit all of the occupants of which meet all applicable requirements under the housing program described in such subsection through which the building is assisted1 financed1 or operated4 7iii7 ,other exceptions ,clause 7i7 shall not apply to a unit occupied by an individual who-- 7,i7 is married1 if such individual's spouse also occupies the unit1 7,,ii7 is a person with disabilities 7as defined in section #c7;b77#c77;,e7 of the ,united ,states ,housing ,act of #aicg71 7,,iii7 is a veteran 7as defined in section #aja7b7 of title #ch1 ,united ,states ,code71 7,,iv7 has one or more qualifying children 7as defined in section #aeb7;c771 if such children also occupy the unit1 the individual is not a dependent 7as defined in section #aeb1 determined without regard to subsections 7b77#a71 7b77#b71 and 7d77#a77;,b7 thereof7 of another individual1 and such children are not claimed as dependents 7as so defined7 of another individual1 or 7,v7 is1 or was immediately prior to attaining the age of majority-- 7aa7 an emancipated minor or in legal guardianship as determined by a court of competent jurisdiction in the individual's ,state of legal residence1 7bb7 under the care and placement responsibility of the ,state agency responsible for administering a plan under part ,b or part ,e of title ,,iv of the ,social ,security ,act1 or 7cc7 was an unaccompanied youth 7within the meaning of section #gbe7f7 of the ,mc,kinney-,vento ,homeless ,assistance ,act 7#db ,u4,s4,c4 #aadcd;a7#f777 or a homeless child or youth 7within the meaning of section #gbe7b7 of such ,act 7#db ,u4,s4,c4 #aadcd;a7#b7774 7,e7 ,owner-occupied buildings having #d or fewer units eligible for credit where development plan 7i7 ,in general ,subparagraph 7,c7 shall not apply to the acquisition or rehabilitation of a building pursuant to a development plan of action sponsored by a ,state or local government or a qualified nonprofit organization4 7ii7 ,limitation on credit ,in the case of a building to which clause 7i7 applies1 the applicable fraction shall not exceed #hj percent of the unit fraction4 7iii7 ,certain unrented units treated as owner-occupied ,in the case of a building to which clause 7i7 applies1 any unit which is not rented for #ij days or more shall be treated as occupied by the owner of the building as of the #ast day it is not rented4 7#b7 ,new building ,the term new building means a building the original use of which begins with the taxpayer4 7#c7 ,existing building ,the term existing building means any building which is not a new building4 7#d7 ,application to estates and trusts ,in the case of an estate or trust1 the amount of the credit determined under subsection 7a7 shall be apportioned between the estate or trust and the beneficiaries on the basis of the income of the estate or trust allocable to each4 7#e7 ,impact of tenant's option to acquire property 7,a7 ,in general ,no ,federal income tax benefit shall fail to be allowable to the taxpayer with respect to any qualified middle-income building merely by reason of an option held by the tenants 7in cooperative form or otherwise7 or resident management corporation of such building or by a qualified nonprofit organization or government agency to purchase the property or all of the partnership interests 7other than interests of the person exercising such option or a related party thereto 7within the meaning of section #bfg7;b7 or #gjg7;b77#a777 relating to the property after the close of the credit period for a price which is not less than the minimum purchase price determined under subparagraph 7,b74 7,b7 ,minimum purchase price ,for purposes of subparagraph 7,a71 the minimum purchase price under this subparagraph is an amount equal to the principal amount of outstanding indebtedness secured by the building 7other than indebtedness incurred within the #e-year period ending on the date of the sale to the tenants74 ,in the case of a purchase of a partnership interest1 the minimum purchase price is an amount equal to such interest's ratable share of the amount determined under the preceding sentence4 7#f7 ,treatment of rural projects ,for purposes of this section1 in the case of any project for residential rental property located in a rural area 7as defined in section #ebj of the ,housing ,act of #aidi71 any income limitation measured by reference to area median gross income shall be measured by reference to the greater of area median gross income or national non-metropolitan median income4 7#g7 ,determination of whether building is ,federally subsidized 7,a7 ,in general ,except as otherwise provided in this paragraph1 for purposes of this section1 a project shall be treated as ,federally subsidized for any taxable year if1 at any time during such taxable year or any prior taxable year1 there is or was outstanding any obligation the interest on which is exempt from tax under section #ajc the proceeds of which are or were used 7directly or indirectly7 with respect to such project or the operation thereof4 7,b7 ,special rule for subsidized construction financing ,subparagraph 7,a7 shall not apply to any tax-exempt obligation used to provide construction financing for any building if-- 7i7 such obligation 7when issued7 identified the building for which the proceeds of such obligation would be used1 and 7ii7 such obligation is redeemed before such building is placed in service4 7#h7 ,reduction in basis ,in the case of any building for which a credit is allowable under this section and section #db1 the basis of the building shall be reduced by the amount of such credit allowed under subsection 7a74 7j7 ,application of at-,risk rules ,for purposes of this section-- 7#a7 ,in general ,except as otherwise provided in this subsection1 rules similar to the rules of section #di7;a77#a7 7other than subparagraphs 7,d77ii77,,ii7 and 7,d77iv77,i7 thereof71 section #di7;a77#b71 and section #di7;b77#a7 shall apply in determining the qualified basis of any building in the same manner as such sections apply in determining the credit base of property4 7#b7 ,special rules for determining qualified person ,for purposes of paragraph 7#a7-- 7,a7 ,in general ,if the requirements of subparagraphs 7,b71 7,c71 and 7,d7 are met with respect to any financing borrowed from a qualified nonprofit organization1 the determination of whether such financing is qualified commercial financing with respect to any qualified middle-income building shall be made without regard to whether such organization-- 7i7 is actively and regularly engaged in the business of lending money1 or 7ii7 is a person described in section #di7;a77#a77;,d77iv77,,ii74 7,b7 ,financing secured by property ,the requirements of this subparagraph are met with respect to any financing if such financing is secured by the qualified middle-income building1 except that this subparagraph shall not apply in the case of a federally assisted building described in section #db7;d77#f77;,c7 if-- 7i7 a security interest in such building is not permitted by a ,federal agency holding or insuring the mortgage secured by such building1 and 7ii7 the proceeds from the financing 7if any7 are applied to acquire or improve such building4 7,c7 ,portion of building attributable to financing ,the requirements of this subparagraph are met with respect to any financing for any taxable year in the credit period if1 as of the close of such taxable year1 not more than #fj percent of the eligible basis of the qualified middle-income building is attributable to such financing 7reduced by the principal and interest of any governmental financing which is part of a wrap-around mortgage involving such financing74 7,d7 ,repayment of principal and interest ,the requirements of this subparagraph are met with respect to any financing if such financing is fully repaid on or before the earliest of-- 7i7 the date on which such financing matures1 7ii7 the #ijth day after the close of the credit period with respect to the qualified middle-income building1 or 7iii7 the date of its refinancing or the sale of the building to which such financing relates4 ,in the case of a qualified nonprofit organization which is not described in section #di7;a77#a77;,d77iv77,,ii7 with respect to a building1 clause 7ii7 of this subparagraph shall be applied as if the date described therein were the #ijth day after the earlier of the date the building ceases to be a qualified middle-income building or the date which is #ae years after the close of a credit period with respect thereto4 7#c7 ,present value of financing ,if the rate of interest on any financing described in paragraph 7#b77;,a7 is less than the rate which is #a percentage point below the applicable ,federal rate as of the time such financing is incurred1 then the qualified basis 7to which such financing relates7 of the qualified middle-income building shall be the present value of the amount of such financing1 using as the discount rate such applicable ,federal rate4 ,for purposes of the preceding sentence1 the rate of interest on any financing shall be determined by treating interest to the extent of government subsidies as not payable4 7#d7 ,failure to fully repay 7,a7 ,in general ,to the extent that the requirements of paragraph 7#b77;,d7 are not met1 then the taxpayer's tax under this chapter for the taxable year in which such failure occurs shall be increased by an amount equal to the applicable portion of the credit under this section with respect to such building1 increased by an amount of interest for the period-- 7i7 beginning with the due date for the filing of the return of tax imposed by chapter #a for the #ast taxable year for which such credit was allowable1 and 7ii7 ending with the due date for the taxable year in which such failure occurs1 determined by using the underpayment rate and method under section #ffba4 7,b7 ,applicable portion ,for purposes of subparagraph 7,a71 the term applicable portion means the aggregate decrease in the credits allowed to a taxpayer under section #ch for all prior taxable years which would have resulted if the eligible basis of the building were reduced by the amount of financing which does not meet requirements of paragraph 7#b77;,d74 7,c7 ,certain rules to apply ,rules similar to the rules of subparagraphs 7,a7 and 7,d7 of section #db7;j77#d7 shall apply for purposes of this subsection4 7k7 ,certifications and other reports to ,secretary 7#a7 ,certification with respect to #ast year of credit period ,following the close of the #ast taxable year in the credit period with respect to any qualified middle-income building1 the taxpayer shall certify to the ,secretary 7at such time and in such form and in such manner as the ,secretary prescribes7-- 7,a7 the taxable year1 and calendar year1 in which such building was placed in service1 7,b7 the adjusted basis and eligible basis of such building as of the close of the #ast year of the credit period1 7,c7 the maximum applicable percentage and qualified basis permitted to be taken into account by the appropriate housing credit agency under subsection 7h71 and 7,d7 such other information as the ,secretary may require4 ,in the case of a failure to make the certification required by the preceding sentence on the date prescribed therefor1 unless it is shown that such failure is due to reasonable cause and not to willful neglect1 no credit shall be allowable by reason of subsection 7a7 with respect to such building for any taxable year ending before such certification is made4 7#b7 ,annual reports to the ,secretary ,the ,secretary may require taxpayers to submit an information return 7at such time and in such form and manner as the ,secretary prescribes7 for each taxable year setting forth-- 7,a7 the qualified basis for the taxable year of each qualified middle-income building of the taxpayer1 7,b7 the information described in paragraph 7#a77;,c7 for the taxable year1 and 7,c7 such other information as the ,secretary may require4 ,the penalty under section #ffeb7;j7 shall apply to any failure to submit the return required by the ,secretary under the preceding sentence on the date prescribed therefor4 7#c7 ,annual reports from housing credit agencies ,each agency which allocates any housing credit amount to any building for any calendar year shall submit to the ,secretary 7at such time and in such manner as the ,secretary shall prescribe7 an annual report specifying-- 7,a7 the amount of housing credit amount allocated to each building for such year1 7,b7 sufficient information to identify each such building and the taxpayer with respect thereto1 and 7,c7 such other information as the ,secretary may require4 ,the penalty under section #ffeb7;j7 shall apply to any failure to submit the report required by the preceding sentence on the date prescribed therefor4 7l7 ,responsibilities of housing credit agencies 7#a7 ,plans for allocation of credit among projects 7,a7 ,in general ,notwithstanding any other provision of this section1 the housing credit dollar amount with respect to any building shall be zero unless-- 7i7 such amount was allocated pursuant to a qualified allocation plan of the housing credit agency which is approved by the governmental unit 7in accordance with rules similar to the rules of section #db7m77#a77 of which such agency is a part1 7ii7 a comprehensive market study of the housing needs of middle-income individuals in the area to be served by the project is conducted before the credit allocation is made and at the developer's expense by a disinterested party who is approved by such agency1 and 7iii7 a written explanation is available to the general public for any allocation of a housing credit dollar amount which is not made in accordance with established priorities and selection criteria of the housing credit agency4 7,b7 ,qualified allocation plan ,for purposes of this paragraph1 the term qualified allocation plan means any plan-- 7i7 which sets forth selection criteria to be used to determine housing priorities of the housing credit agency which are appropriate to local conditions1 7ii7 which also gives preference in allocating housing credit dollar amounts among selected projects to-- 7,i7 projects obligated to serve qualified tenants for the longest periods1 7,,ii7 projects in areas with insufficient supply of housing affordable to median income households1 7,,iii7 projects which target housing to tenants at a range of incomes between #fj and #ajj percent of area median gross income1 and 7,,iv7 projects located near transit hubs1 and 7iii7 which provides a procedure that the agency 7or an agent or other private contractor of such agency7 will follow in monitoring for noncompliance with the provisions of this section and in notifying the ,internal ,revenue ,service of such noncompliance which such agency becomes aware of and in monitoring for noncompliance with habitability standards through regular site visits4 7,c7 ,certain selection criteria must be used ,the selection criteria set forth in a qualified allocation plan must include-- 7i7 project location1 7ii7 housing needs characteristics1 7iii7 project characteristics1 including whether the project includes the use of existing housing as part of a community revitalization plan1 7iv7 sponsor characteristics1 7v7 tenant populations with special housing needs1 7vi7 tenant populations of individuals with children1 7vii7 projects intended for eventual tenant ownership1 7viii7 the energy efficiency of the project1 and 7ix7 the historic nature of the project4 7,d7 ,certain selection criteria prohibited ,the selection criteria set forth in a qualified allocation plan shall not include a requirement of local approval or local contributions1 either as a threshold qualification requirement or as part of a point system to be considered for allocations of housing credit dollar amount4 7#b7 ,credit allocated to building not to exceed amount necessary to assure project feasibility 7,a7 ,in general ,the housing credit dollar amount allocated to a project shall not exceed the amount the housing credit agency determines is necessary for the financial feasibility of the project and its viability as a qualified middle-income housing project throughout the credit period4 7,b7 ,agency evaluation ,in making the determination under subparagraph 7,a71 the housing credit agency shall consider-- 7i7 the sources and uses of funds and the total financing planned for the project1 7ii7 any proceeds or receipts expected to be generated by reason of tax benefits1 7iii7 the percentage of the housing credit dollar amount used for project costs other than the cost of intermediaries1 and 7iv7 the reasonableness of the developmental and operational costs of the project4 ,clause 7iii7 shall not be applied so as to impede the development of projects in hard-to-develop areas4 ,such a determination shall not be construed to be a representation or warranty as to the feasibility or viability of the project4 7,c7 ,determination made when credit amount applied for and when building placed in service 7i7 ,in general ,a determination under subparagraph 7,a7 shall be made as of each of the following times3 7,i7 ,the application for the housing credit dollar amount4 7,,ii7 ,the allocation of the housing credit dollar amount4 7,,iii7 ,the date the building is placed in service4 7ii7 ,certification as to amount of other subsidies ,prior to each determination under clause 7i71 the taxpayer shall certify to the housing credit agency the full extent of all ,federal1 ,state1 and local subsidies which apply 7or which the taxpayer expects to apply7 with respect to the building4 7m7 ,regulations ,the ,secretary shall prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section1 including-- 7#a7 regulations dealing with-- 7,a7 projects which include more than #a building or only a portion of a building1 or 7,b7 buildings which are placed in service in portions1 7#b7 regulations providing for the application of this section to short taxable years1 7#c7 regulations preventing the avoidance of the rules of this section1 7#d7 regulations providing the opportunity for housing credit agencies to correct administrative errors and omissions with respect to allocations and record keeping within a reasonable period after their discovery1 taking into account the availability of regulations and other administrative guidance from the ,secretary1 and 7#e7 in consultation with the ,secretary of ,housing and ,urban ,development1 regulations or guidance to promote uniform definitions and to streamline requirements for with respect to qualified middle-income buildings which receive funding from programs administrated by the ,department of ,housing and ,urban ,development1 including programs authorized by ,native ,american ,housing ,assistance and ,self-,determination ,act of #aiif4 4 7b7 ,treatment as part of general business credit ,section #ch7;b71 as amended by the preceding provisions of this ,act1 is amended by striking plus at the end of paragraph 7#da71 by striking the period at the end of paragraph 7#db7 and inserting 1 plus1 and by adding at the end the following new paragraph3 7#dc7 the middle-income housing credit determined under section #db;,a7a74 4 7c7 ,reduction in basis ,section #ajaf7;a7 is amended by striking and at the end of paragraph 7#cg71 by striking the period at the end of paragraph 7#ch7 and inserting 1 and1 and by adding at the end the following new paragraph3 7#ci7 to the extent provided in section #db;,a7i77#h74 4 7d7 ,treatment under base erosion minimum tax ,section #ei;,a7b77#d7 is amended by redesignating subparagraphs 7,b7 and 7,c7 as subparagraphs 7,c7 and 7,d71 respectively1 and by inserting after subparagraphs 7,a7 the following new subparagraph3 7,b7 the middle-income housing credit determined under section #db;,a7a71 4 7e7 ,conforming amendments relating to low-,income housing tax credit ,section #db7n7 is amended-- 7#a7 by striking regulations in the matter preceding paragraph 7#a71 7#b7 by inserting regulations before dealing with in paragraph 7#a71 7#c7 by inserting regulations before providing in paragraphs 7#b7 and 7#d71 7#d7 by inserting regulations before preventing in paragraph 7#c71 7#e7 by striking and at the end of paragraph 7#c71 7#f7 by striking the period at the end of paragraph 7#d7 and inserting 1 and1 and 7#g7 by adding at the end the following new paragraph3 7#e7 in consultation with the ,secretary of ,housing and ,urban ,development1 regulations or guidance to promote uniform definitions and to streamline requirements for with respect to qualified low-income buildings which receive funding from programs administrated by the ,department of ,housing and ,urban ,development1 including programs authorized by ,native ,american ,housing ,assistance and ,self-,determination ,act of #aiif4 4 7f7 ,conforming amendments 7#a7 ,section #de,l7e7 is amended by inserting or #db;,a after #db4 7#b7 ,section #ej7;c77#c77;,c7 is amended by inserting or #db;,a after #db4 7#c7 ,section #ee7;c77#a7 is amended by inserting #db;,a7j71 before #de7;e77#aa77;,c74 7#d7 ,subsections 7i77#c77;,c71 7i77#f77;,b77i71 and 7k77#a7 of section #dfi are each amended by inserting or #db;,a after #db4 7#e7 ,the table of sections for subpart ,d of part ,,iv of subchapter ,a of chapter #a is amended by inserting after the item relating to section #db the following new item3 ,sec4 #db;,a4 ,middle-income housing credit4 4 7g7 ,effective date ,the amendments made by this section shall apply to buildings placed in service after ,december #ca1 #bjbe1 in taxable years ending after such date4 ,c ,affording the ,american dream #acjja4 ,first-time homebuyer refundable tax credit 7a7 ,in general ,section #cf is amended to read as follows3 #cf4 ,first-time homebuyer credit 7a7 ,allowance of credit ,in the case of an individual who is a first-time homebuyer of a principal residence in the ,united ,states during a taxable year1 there shall be allowed as a credit against the tax imposed by this subtitle for such taxable year an amount equal to #aj percent of the purchase price of the residence4 7b7 ,limitations 7#a7 ,dollar limitation 7,a7 ,in general ,except as otherwise provided in this paragraph1 the credit allowed under subsection 7a7 shall not exceed #ae1jjj4 7,b7 ,married individuals filing separately ,in the case of a married individual filing a separate return1 subparagraph 7,a7 shall be applied by substituting #g1ejj for #ae1jjj4 7,c7 ,other individuals ,if #b or more individuals who are not married purchase a principal residence1 the amount of the credit allowed under subsection 7a7 shall be allocated among such individuals in such manner as the ,secretary may prescribe1 except that the total amount of the credits allowed to all such individuals shall not exceed #ae1jjj4 7#b7 ,phaseout based on area median income 7,a7 ,in general ,the amount allowable as a credit under subsection 7a7 7determined without regard to this paragraph7 shall be reduced 7but not below zero7 by the amount which bears the same ratio to the amount which is so allowable as-- 7i7 the excess 7if any7 of-- 7,i7 the modified adjusted gross income of the taxpayer for the taxable year1 over 7,,ii7 #aej percent of the applicable ,area ,medium ,income1 bears to 7ii7 #bj percent of the applicable ,area ,median ,income4 7,b7 ,modified adjusted gross income ,for purposes of subparagraph 7,a71 the term modified adjusted gross income means the adjusted gross income of the taxpayer for the taxable year increased by any amount excluded from gross income under section #iaa1 #ica1 or #icc4 7,c7 ,applicable ,area ,median ,income ,for purposes of subparagraph 7,a71 the term applicable ,area ,median ,income means the ,area ,median ,income set by the ,secretary of ,housing and ,urban ,development with respect to-- 7i7 the area in which the principal residence is located1 7ii7 the size of the household of the taxpayer1 and 7iii7 the calendar year in which the principal residence is purchased4 7,d7 ,regulations and guidance ,the ,secretary1 after consultation with the ,secretary of ,housing and ,urban ,development1 shall issue such regulations and guidance as are necessary to carry out the purposes of this subparagraph4 7#c7 ,limitation based on area median purchase price 7,a7 ,in general ,the amount allowable as a credit under subsection 7a7 7determined without regard to this paragraph7 shall be reduced 7but not below zero7 by the amount which bears the same ratio to the amount which is so allowable as-- 7i7 the excess 7if any7 of-- 7,i7 the purchase price of the principal residence1 over 7,,ii7 the amount which is equal to #aaj percent of the area median purchase price1 bears to 7ii7 the amount which is equal to #ae percent of the area median purchase price4 7,b7 ,area median purchase price ,for purposes of this paragraph1 the term area median purchase price means the median purchase price for a home in both the area and the calendar year in which the purchase of the principal residence takes place4 7,c7 ,regulations and guidance ,the ,secretary1 after consultation with the ,secretary of ,housing and ,urban ,development1 shall promulgate such regulations and guidance as are necessary to carry out the purposes of this subparagraph1 including for determining the area median purchase price with respect to different localities4 7#d7 ,inflation adjustment ,in the case of any taxable year beginning in a calendar year after #bjbf1 each of the dollar amounts in paragraph 7#a7 shall be increased by an amount equal to-- 7,a7 such dollar amount1 multiplied by 7,b7 the cost-of-living adjustment determined under section #a7;f77#c7 for the calendar year in which the taxable year begins1 determined by substituting calendar year #bjbe for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 ,any increase determined under the preceding sentence shall be rounded to the nearest multiple of #ajj4 7#e7 ,age limitation ,no credit shall be allowed under subsection 7a7 with respect to the purchase of any residence unless the taxpayer has attained age #ah as of the date of such purchase4 ,in the case of any taxpayer who is married 7within the meaning of section #ggjc71 the taxpayer shall be treated as meeting the age requirement of the preceding sentence if the taxpayer or the taxpayer's spouse meets such age requirement4 7c7 ,definitions ,for purposes of this section-- 7#a7 ,first-time homebuyer ,the term first-time homebuyer means any individual if such individual 7and if married1 such individual's spouse7-- 7,a7 has no present ownership interest in any residence during the #c-year period ending on the date of the purchase of the principal residence to which this section applies1 and 7,b7 has not taken the credit under this section in any other taxable year4 7#b7 ,principal residence ,the term principal residence has the same meaning as when used in section #aba4 7#c7 ,purchase 7,a7 ,in general ,the term purchase means any acquisition1 but only if-- 7i7 the property is not acquired from a person related to the person acquiring such property 7or1 if married1 such individual's spouse71 7ii7 the acquisition is financed through a federally backed mortgage loan 7as defined in section #djbb of the ,,cares ,act71 and 7iii7 the basis of the property in the hands of the person acquiring such property is not determined-- 7,i7 in whole or in part by reference to the adjusted basis of such property in the hands of the person from whom acquired1 or 7,,ii7 under section #ajad7;a7 7relating to property acquired from a decedent74 7,b7 ,construction ,a residence which is constructed by the taxpayer shall be treated as purchased by the taxpayer on the date the taxpayer first occupies such residence4 7#d7 ,purchase price ,the term purchase price means the adjusted basis of the principal residence on the date such residence is purchased4 7#e7 ,related persons ,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 #bfg or #gjg7;b74 7d7 ,exceptions ,no credit under subsection 7a7 shall be allowed to any taxpayer for any taxable year with respect to the purchase of a residence if-- 7#a7 the taxpayer disposes of such residence 7or such residence ceases to be the principal residence of the taxpayer 7and1 if married1 the taxpayer's spouse77 before the close of such taxable year1 7#b7 a deduction under section #aea with respect to such taxpayer is allowable to another taxpayer for such taxable year1 or 7#c7 the taxpayer fails to attach to the return of tax for such taxable year a properly executed copy of the settlement statement used to complete such purchase4 7e7 ,reporting ,if the ,secretary requires information reporting under section #fjde by a person described in subsection 7e77#b7 thereof to verify the eligibility of taxpayers for the credit allowable by this section1 the exception provided by section #fjde7;e77#e7 shall not apply4 7f7 ,recapture of credit 7#a7 ,in general ,except as otherwise provided in this subsection1 if1 during any taxable year before the close of the recapture period1 a taxpayer disposes of the principal residence with respect to which a credit was allowed under subsection 7a7 7or such residence ceases to be the principal residence of the taxpayer71 the tax imposed by this chapter for such taxable year shall be increased by the recoverable amount determined in paragraph 7#b74 7#b7 ,recoverable amount ,for purposes of paragraph 7#a71 the recoverable amount is the product of-- 7,a7 #be percent of the amount of the credit allowed under subsection 7a71 multiplied by 7,b7 the number of taxable years remaining in the recapture period as of the beginning of the taxable year in which the taxpayer disposes of the principal residence4 7#c7 ,limitation based on gain ,in the case of the sale of the principal residence to a person who is not related to the taxpayer1 the increase in tax determined under paragraph 7#a7 shall not exceed the amount of gain 7if any7 on such sale4 ,solely for purposes of the preceding sentence1 the adjusted basis of such residence shall be reduced by the amount of the credit allowed under subsection 7a74 7#d7 ,exceptions 7,a7 ,death of a taxpayer ,paragraph 7#a7 shall not apply to any taxable year ending after the date of the taxpayer's death4 7,b7 ,involuntary conversion ,paragraph 7#a7 shall not apply in the case of a residence which is compulsorily or involuntarily converted 7within the meaning of section #ajcc7;a77 if the taxpayer acquires a new principal residence during the #b-year period beginning on the date of the disposition or cessation referred to in paragraph 7#a74 ,paragraph 7#a7 shall apply to such new principal residence during the recapture period in the same manner as if such new principal residence were the converted residence4 7,c7 ,transfers between spouses or incident to divorce ,in the case of a transfer of a residence to which section #ajda7;a7 applies-- 7i7 paragraph 7#a7 shall not apply to such transfer1 and 7ii7 in the case of taxable years ending after such transfer1 paragraph 7#a7 shall apply to the transferee in the same manner as if such transferee were the transferor 7and shall not apply to the transferor74 7,d7 ,special rule for members of the ,armed ,forces1 etc 7i7 ,in general ,in the case of the disposition of a principal residence by an individual 7or a cessation referred to in paragraph 7#a77 after the date of the enactment of this section1 in connection with ,government orders received by such individual1 or such individual's spouse1 for qualified official extended duty service1 paragraph 7#a7 and subsection 7d77#b7 shall not apply to such disposition 7or cessation74 7ii7 ,qualified official extended duty service ,for purposes of this section1 the term qualified official extended duty service means service on qualified official extended duty as-- 7,i7 a member of the uniformed services1 7,,ii7 a member of the ,foreign ,service of the ,united ,states1 or 7,,iii7 an employee of the intelligence community4 7iii7 ,definitions ,any term used in this subparagraph which is also used in paragraph 7#i7 of section #aba7;d7 shall have the same meaning as when used in such paragraph4 7,e7 ,disposition of residence in connection with change of employment ,in the case of the disposition of a principal residence by an individual 7or a cessation referred to in paragraph 7#a77 after ,december #ca1 #bjbb1 in connection with a change of employment which meets the conditions described in section #bag7;c71 paragraph 7#a7 shall not apply to such disposition 7or cessation74 7#e7 ,joint returns ,in the case of a credit allowed under subsection 7a7 with respect to a joint return1 half of such credit shall be treated as having been allowed to each individual filing such return for purposes of this subsection4 7#f7 ,return requirement ,if the tax imposed by this chapter for the taxable year is increased under this subsection1 the taxpayer shall1 notwithstanding section #fjab1 be required to file a return with respect to the taxes imposed under this subtitle4 7#g7 ,recapture period ,for purposes of this subsection1 the term recapture period means the #d taxable years beginning with the taxable year in which the purchase of the principal residence for which a credit is allowed under subsection 7a7 was made4 7g7 ,election ,to treat purchase in prior year ,in the case of a purchase of a principal residence after ,december #ca1 #bjbf1 a taxpayer may elect to treat such purchase as made on ,december #ca of the calendar year preceding such purchase for purposes of this section 7other than subsections 7b77#d71 7c71 and 7h774 7h7 ,transfer of credit 7#a7 ,in general ,subject to such regulations and other guidance as the ,secretary determines necessary1 a taxpayer may elect that the credit which would 7but for this subsection7 be allowed to such taxpayer with respect to the purchase of a principal residence shall be allowed to the mortgage lender with respect to such purchase and not to such taxpayer4 7#b7 ,eligible entity ,for purposes of this subsection1 the term eligible entity means1 with respect to the purchase of the principal residence for which the credit is allowed under subsection 7a71 the mortgage lender which provides the mortgage to the taxpayer and has-- 7,a7 registered with the ,secretary for purposes of this paragraph1 at such time1 and in such form and manner1 as the ,secretary may prescribe1 7,b7 prior to the election described in paragraph 7#a7 and not later than at the time of such purchase1 disclosed to the taxpayer making such purchase-- 7i7 the value of the credit allowed under subsection 7a71 and 7ii7 the amount provided by the mortgage lender to such taxpayer as a condition of the election described in paragraph 7#a74 7,c7 not later than at the time of such purchase1 made payment to such taxpayer 7whether in cash or in the form of a partial payment or down payment for the purchase of such principal residence7 in an amount equal to the credit otherwise allowable to such taxpayer1 and 7,d7 with respect to any incentive otherwise available for taking a mortgage for which a credit is allowed under this section1 including any incentive in the form of a rebate or discount provided by the mortgage lender1 ensured that-- 7i7 the availability or use of such incentive shall not limit the ability of a taxpayer to make an election described in paragraph 7#a71 and 7ii7 such election shall not limit the value or use of such incentive4 7#c7 ,timing ,an election described in paragraph 7#a7 shall be made by the taxpayer not later than the date on which the purchase of the principal residence with respect to which the credit under subsection 7a7 is allowed is made4 7#d7 ,revocation of registration ,upon determination by the ,secretary that a mortgage lender has failed to comply with the requirements described in paragraph 7#b71 the ,secretary may revoke the registration 7as described in subparagraph 7,a7 of such paragraph7 of such mortgage lender4 7#e7 ,tax treatment of payments ,with respect to any payment described in paragraph 7#b77;,c71 such payment-- 7,a7 shall not be includible in the gross income of the taxpayer1 and 7,b7 with respect to the mortgage lender1 shall not be deductible under this title4 7#f7 ,advance payment to mortgage lenders 7,a7 ,in general ,the ,secretary shall establish a program to make advance payments to any eligible entity in an amount equal to the cumulative amount of the credits allowed under subsection 7a7 with respect to any mortgages issued by such entity for which an election described in paragraph 7#a7 has been made4 7,b7 ,excessive payments ,rules similar to the rules of section #fdag7;d77#f7 shall apply for purposes of this paragraph4 7,c7 ,treatment of advance payments ,for purposes of section #acbd of title #ca1 ,united ,states ,code1 the payments under subparagraph 7,a7 shall be treated in the same manner as a refund due from a credit provision referred to in subsection 7b77#b7 of such section4 7#g7 ,recapture ,in the case of any taxpayer who has made an election described in paragraph 7#a7 with respect to the purchase of a principal residence and received a payment described in paragraph 7#b77;,c7 from an eligible entity1 such principal residence shall be treated as a principal residence with respect to which a credit was allowed under subsection 7a7 for purposes of subsection 7f74 4 7b7 ,certain errors with respect to first-,time homebuyer tax credit treated as mathematical or clerical errors ,paragraph 7#b7 of section #fbac7;g71 as amended by ,public ,law #aai-ba1 is amended by striking and at the end of subparagraph 7,z71 by striking the period at the end of subparagraph 7,,aa7 and inserting 1 and1 and by inserting after subparagraph 7,,aa7 the following new subparagraph3 7,,bb7 an entry on a return claiming the credit under section #cf if-- 7i7 the ,secretary obtains information from the person issuing the ,,tin of the taxpayer that indicates that the taxpayer does not meet the age requirement of section #cf7;b77#d71 7ii7 information provided to the ,secretary by the taxpayer on an income tax return for at least one of the #b preceding taxable years is inconsistent with eligibility for such credit1 or 7iii7 the taxpayer fails to attach to the return the form described in section #cf7;d77#c74 4 7c7 ,effective date ,the amendments made by this section shall apply with respect to principal residences purchased after the date of the enactment of this ,act4 #acjjb4 ,refundable credit for rent paid for principal residence 7a7 ,in general ,subpart ,c of part ,,iv of subchapter ,a of chapter #a is amended by inserting after section #cf;,b the following new section3 #cf;,c4 ,renter tax credit 7a7 ,in general ,in the case of an individual who leases the individual's principal residence 7within the meaning of section #aba7 during the taxable year and who pays rent with respect to such residence in excess of #cj percent of the taxpayer's adjusted gross income for such taxable year1 there shall be allowed as a credit against the tax imposed by this subtitle for such taxable year an amount equal to the applicable percentage of such excess4 7b7 ,credit limited by #ajj percent of small area fair market rent ,solely for purposes of determining the amount of the credit allowed under subsection 7a7 with respect to a residence for the taxable year1 there shall not be taken into account rent in excess of an amount equal to #ajj percent of the small area fair market rent 7including the utility allowance7 applicable to the residence involved 7as most recently published1 as of the beginning of the taxable year1 by the ,department of ,housing and ,urban ,development74 7c7 ,definitions and special rules ,for purposes of this section-- 7#a7 ,applicable percentage ,the term applicable percentage means the percentage determined in accordance with the following table3 ,the applicable,if the taxpayer's adjusted gross income is3percentage is3,not over #be1jjjajj percent,over #be1jjj1 but not over #ej1jjjge percent,over #ej1jjj1 but not over #ge1jjjej percent,over #ge1jjj1 but not over #ajj1jjjbe percent,over #ajj1jjjj percent4 7#b7 ,partial year residence ,the ,secretary shall prescribe such rules as are necessary to carry out the purposes of this section for taxpayers with respect to whom a residence is a principal residence for only a portion of the taxable year4 7#c7 ,rent ,the term rent includes any amount paid for utilities of a type taken into account for purposes of determining the utility allowance under section #db7;g77#b77;,b77ii74 7#d7 ,married individuals filing separate returns ,in the case of individuals who are married to each other1 have the same principal residence1 and do not file a joint return for the taxable year1 the credit determined under this section with respect to each such individual shall be #ej percent of the amount of the credit which would be determined under this section if such individuals filed a joint return1 unless such individuals agree on a different division of such credit 7in such manner as the ,secretary may provide7 which does not aggregate to more #ajj percent of such amount4 7d7 ,reconciliation of credit and advance payments ,the amount of the credit allowed under this section for any taxable year shall be reduced 7but not below zero7 by the aggregate amount of any advance payments of such credit under section #gebg;,b for such taxable year4 4 7b7 ,advance payment ,chapter #gg is amended by inserting after section #gebg;,a the following new section3 #gebg;,b4 ,advance payment of renter tax credit 7a7 ,in general ,not later than #f months after the date of the enactment of this section1 the ,secretary shall establish a program for making advance payments of the credit allowed under section #cf;,c on a monthly basis to any taxpayer who-- 7#a7 the ,secretary has determined will be allowed such credit for the taxable year1 and 7#b7 has made an election under subsection 7c74 7b7 ,amount of advance payment 7#a7 ,in general ,for purposes of subsection 7a71 the amount of the monthly advance payment of the credit provided to a taxpayer during the applicable period shall be equal to the lesser of-- 7,a7 an amount equal to-- 7i7 the amount of the credit which the ,secretary has determined will be allowed to such taxpayer under section #cf;,c for the taxable year ending in such applicable period1 divided by 7ii7 #ab1 or 7,b7 such other amount as is elected by the taxpayer4 7#b7 ,applicable period ,for purposes of this section1 the term applicable period means the #ab-month period from the month of ,july of the taxable year through the month of ,june of the subsequent taxable year4 7c7 ,election of advance payment ,a taxpayer may elect to receive an advance payment of the credit allowed under section #cf;,c for any taxable year by including such election on a timely filed return for the preceding taxable year4 7d7 ,internal ,revenue ,service notification ,the ,internal ,revenue ,service shall take such steps as may be appropriate to ensure that taxpayers who are eligible to receive the credit under section #cf;,c are aware of the availability of the advance payment of such credit under this section4 7e7 ,treatment of payments ,for purposes of section #acbd of title #ca1 ,united ,states ,code1 the payments under this section shall be treated in the same manner as a refund due from a credit provision referred to in subsection 7b77#b7 of such section4 7f7 ,regulations ,the ,secretary may prescribe such regulations or other guidance as may be necessary or appropriate to carry out the purposes this section4 4 7c7 ,conforming amendments 7#a7 ,section #fbaa7;b77#d77;,a7 is amended by inserting #cf;,c1 after #cf;,b14 7#b7 ,section #acbd7;b77#b7 of title #ca1 ,united ,states ,code1 is amended by inserting #cf;,c1 after #cf;,b14 7#c7 ,the table of sections for subpart ,c of part ,,iv of subchapter ,a of chapter #a is amended by inserting after the item relating to section #cf;,b the following new item3 ,sec4 #cf;,c4 ,renter tax credit4 4 7#d7 ,the table of sections for chapter #gg is amended by inserting after the item relating to section #gebg;,a the following new item3 ,sec4 #gebg;,b4 ,advance payment of renter tax credit4 4 7d7 ,effective date ,the amendments made by this section shall apply with respect to taxable years beginning after ,december #ca1 #bjbe4 7e7 ,community outreach ,immediately upon the enactment of this ,act1 in addition to amounts otherwise available1 there are appropriated out of any money in the ,treasury not otherwise appropriated #ej1jjj1jjj to remain available until #e years after the enactment of this ,act for necessary expenses for the ,internal ,revenue ,service to support efforts to increase enrollment of eligible households in the ,renter ,tax ,credit allowed under section #cf;,c of the ,internal ,revenue ,code of #aihf 7including the advance payment of such credit under section #gebg;,b of such ,code71 including but not limited to program outreach1 costs of data sharing arrangements1 systems changes1 forms changes1 and related efforts1 and efforts by ,federal agencies to facilitate the cross-enrollment of beneficiaries of other programs in such ,renter ,tax ,credit1 including by establishing intergovernmental cooperative agreements with ,states and local governments1 tribal governments1 and possessions of the ,united ,states3 ,provided1 that such amount shall be available in addition to any amounts otherwise available3 ,provided further1 that these funds may be awarded by ,federal agencies to ,state and local governments1 tribal governments1 and possessions of the ,united ,states1 and private entities1 including organizations dedicated to free tax return preparation4 ,,ii ,lowering energy costs ,a ,lowering costs through an all-of-the-above energy policy #bajja4 ,clean energy production credit 7a7 ,restoration of phase-,out ,section #de,y7d77#c7 is amended by striking calendar year #bjcb4 and inserting means the later of-- 7,a7 the calendar year in which the ,secretary determines that the annual greenhouse gas emissions from the production of electricity in the ,united ,states are equal to or less than #be percent of the annual greenhouse gas emissions from the production of electricity in the ,united ,states for calendar year #bjbb1 or 7,b7 #bjcb4 4 7b7 ,restoration of credit for wind and solar facilities ,section #de,y7d7 is amended-- 7#a7 in paragraph 7#a71 by striking ,subject to paragraph 7#d71 the amount and inserting ,the amount1 and 7#b7 by striking paragraph 7#d74 7c7 ,restoration of credit for wind and solar leasing arrangements ,section #de,y is amended by striking subsection 7h74 7d7 ,repeal of provision for existing studies ,section #de,y7b77#b77;,c7 is amended by striking clause 7iii74 7e7 ,effective dates ,the amendments made by this section shall take effect as if included in section #gjeab of ,public ,law #aai-ba4 #bajjb4 ,clean electricity investment credit 7a7 ,repeal of termination for wind and solar facilities ,section #dh;,e7e7 is amended-- 7#a7 in paragraph 7#a71 by striking ,subject to paragraph 7#d71 the amount and inserting ,the amount1 and 7#b7 by striking paragraph 7#d74 7b7 ,restoration of credit for expenditures for wind and solar leasing arrangements 7#a7 ,in general ,section #dh;,e is amended by striking subsection 7i7 and by redesignating subsections 7j7 and 7k7 as subsections 7i7 and 7j71 respectively4 7#b7 ,conforming rule repeal ,section #ej is amended by striking subsection 7e74 7c7 ,restoration of credit for certain energy property ,section #dh7;a77#b77;,a77ii7 is amended by striking #j percent and inserting #b percent4 7d7 ,effective dates ,the amendments made by this section shall take effect as if included in section #gjeac of ,public ,law #aai-ba4 #bajjc4 ,advanced manufacturing production credit 7a7 ,repeal of inclusion of metallurgical coal as an applicable critical mineral ,section #de,x7c77#f7 is amended by striking subparagraph 7,r7 and by redesignating subparagraphs 7,s7 through 7,,aa7 as subparagraphs 7,r7 through 7,,zz71 respectively4 7b7 ,repeal of termination for wind energy components ,section #de,x7b77#c7 is amended by striking subparagraph 7,d74 7c7 ,conforming amendments 7#a7 ,section #de,x7b77#a77,m7 is amended by striking 7#b4e percent in the case of metallurgical coal74 7#b7 ,the heading of section #de,x7b77#c7 is amended by striking and termination4 7#c7 ,section #de,x7b77#c77;,a7 is amended by striking subparagraphs 7,c7 and 7,d7 and inserting subparagraph 7,c74 7#d7 ,the heading of section #de,x7b77#c77;,c7 is amended by striking other than metallurgical coal4 7#e7 ,the heading of section #de,x7b77#c77;,c77ii7 is amended by striking other than metallurgical coal4 7#f7 ,section #de,x7b77#c7 is amended by striking subparagraph 7,e74 7d7 ,effective date ,the amendments made by this section shall take effect as if included in section #gjead of ,public ,law #aai-ba4 #bajjd4 ,repeal of restriction on the extension of advance energy project credit program 7a7 ,in general ,section #dh;,c7e77#c77;,c7 is amended by striking shall not be increased and inserting shall be increased4 7b7 ,effective date ,the amendment made by this section shall take effect as if included in section #gjeae of ,public ,law #aai-ba4 #bajje4 ,reversion of construction date for clean hydrogen production credit 7a7 ,in general ,section #de,v7c77#c77;,c7 is amended by striking ,january #a1 #bjbh and inserting ,january #a1 #bjcc4 7b7 ,effective date ,the amendment made by this section shall take effect as if included in section #gjeaa of ,public ,law #aai-ba4 #bajjf4 ,reversion of termination for residential clean energy credit 7a7 ,in general ,section #be;,d7h7 is amended by striking with respect to any expenditures made after ,december #ca1 #bjbe and inserting to property placed in service after ,december #ca1 #bjcd4 7b7 ,conforming amendment ,section #be;,d7g7 is amended by striking and at the end of paragraph 7#b71 by striking #cj percent4 at the end of paragraph 7#c7 and inserting and before ,january #a1 #bjcc1 #cj percent1 and by adding at the end the following new paragraphs3 7#d7 in the case of property placed in service after ,december #ca1 #bjcb1 and before ,january #a1 #bjcd1 #bf percent1 and 7#e7 in the case of property placed in service after ,december #ca1 #bjcc1 and before ,january #a1 #bjce1 #bb percent4 4 7c7 ,effective date ,the amendments made by this section shall take effect as if included in section #gjejf of ,public ,law #aai-ba4 #bajjg4 ,reinstatement of special rate for sustainable aviation fuel 7a7 ,in general ,section #de,z7a77#c7 is amended to read as follows3 7#c7 ,special rate for sustainable aviation fuel 7,a7 ,in general ,in the case of a transportation fuel which is sustainable aviation fuel1 paragraph 7#b7 shall be applied-- 7i7 in the case of fuel produced at a qualified facility described in paragraph 7#b77;,a71 by substituting #ce cents for #bj cents1 and 7ii7 in the case of fuel produced at a qualified facility described in paragraph 7#b77;,b71 by substituting #a4ge for #a4jj4 7,b7 ,sustainable aviation fuel ,for purposes of subparagraph 7,a71 the term sustainable aviation fuel means liquid fuel1 the portion of which is not kerosene1 which is sold for use in an aircraft and which-- 7i7 meets the requirements of-- 7,i7 ,,astm ,international ,standard ,d#geff1 or 7,,ii7 the ,fischer ,tropsch provisions of ,,astm ,international ,standard ,d#afee1 ,annex ,a#a1 and 7ii7 is not derived from palm fatty acid distillates or petroleum4 4 7b7 ,conforming amendment ,section #de,z7c77#a7 is amended by striking and the #a4jj amount in subsection 7a77#b77;,b7 and inserting the #a4jj amount in subsection 7a77#b77;,b71 the #ce cent amount in subsection 7a77#c77;,a77i71 and the #a4ge amount in subsection 7a77#c77;,a77ii74 7c7 ,effective date ,the amendments made by this section shall take effect as if included in section #gjeba of ,public ,law #aai-ba4 ,b ,lowering costs through energy efficiency #bbjja4 ,energy efficient home improvement credit 7a7 ,restoring product identification number requirement ,section #be;,c7h7 is amended to read as follows3 7h7 ,product identification number requirement 7#a7 ,in general ,no credit shall be allowed under subsection 7a7 with respect to any item of specified property placed in service after ,december #ca1 #bjbe1 unless-- 7,a7 such item is produced by a qualified manufacturer1 and 7,b7 the taxpayer includes the qualified product identification number of such item on the return of tax for the taxable year4 7#b7 ,qualified product identification number ,for purposes of this section1 the term qualified product identification number means1 with respect to any item of specified property1 the product identification number assigned to such item by the qualified manufacturer pursuant to the methodology referred to in paragraph 7#c74 7#c7 ,qualified manufacturer ,for purposes of this section1 the term qualified manufacturer means any manufacturer of specified property which enters into an agreement with the ,secretary which provides that such manufacturer will-- 7,a7 assign a product identification number to each item of specified property produced by such manufacturer utilizing a methodology that will ensure that such number 7including any alphanumeric7 is unique to each such item 7by utilizing numbers or letters which are unique to such manufacturer or by such other method as the ,secretary may provide71 7,b7 label such item with such number in such manner as the ,secretary may provide1 and 7,c7 make periodic written reports to the ,secretary 7at such times and in such manner as the ,secretary may provide7 of the product identification numbers so assigned and including such information as the ,secretary may require with respect to the item of specified property to which such number was so assigned4 7#d7 ,specified property ,for purposes of this subsection1 the term specified property means any qualified energy property and any property described in subparagraph 7,b7 or 7,c7 of subsection 7c77#c74 4 7b7 ,effective date ,the amendment made by this section shall take effect as if included in the enactment of section #gjeje of ,public ,law #aai-ba4 #bbjjb4 ,new energy efficient home credit 7a7 ,in general ,section #de,l7h7 is amended by striking acquired after ,june #cj1 #bjbf and inserting acquired after ,december #ca1 #bjcb4 7b7 ,effective date ,the amendment made by this section shall take effect as if included in section #gjejh of ,public ,law #aai-ba4 #bbjjc4 ,repeal of termination of new energy efficient commercial buildings deduction 7a7 ,in general ,section #agi;,d is amended by striking subsection 7i74 7b7 ,effective date ,the amendment made by this section shall take effect as if included in section #gjejg of ,public ,law #aai-ba4 #bbjjd4 ,restoration of cost recovery for energy property 7a7 ,in general ,section #afh7;e77#c77;,b77vi7 is amended-- 7#a7 by redesignating subclauses 7,i7 and 7,,ii7 as subclauses 7,,ii7 and 7,,iii71 respectively1 and 7#b7 by inserting before subclause 7,,ii7 7as so redesignated7 the following subclause3 7,i7 is described in subparagraph 7,a7 of section #dh7;a77#c7 7or would be so described if solar or wind energy were substituted for solar energy in clause 7i7 thereof and the last sentence of such section did not apply to such subparagraph71 4 7b7 ,effective date ,the amendment made by this section shall take effect as if included in section #gjeji of ,public ,law #aai-ba4 ,c ,lowering costs for electric vehicles and charging infrastructure #bcjja4 ,reversion of termination date for previously-owned vehicle credit 7a7 ,in general ,section #be;,e7g7 is amended by striking acquired after ,september #cj1 #bjbe and inserting acquired after ,december #ca1 #bjcb4 7b7 ,effective date ,the amendment made by this section shall take effect as if included in section #gjeja of ,public ,law #aai-ba4 #bcjjb4 ,reversion of termination date for clean vehicle credit 7a7 ,in general ,section #cj;,d7h7 is amended by striking acquired after ,september #cj1 #bjbe and inserting placed in service after ,december #ca1 #bjcb4 7b7 ,conforming amendments 7#a7 ,section #cj;,d7e77#a77;,b7 is amended by striking and at the end of clause 7iii71 by striking the period at the end of clause 7iv7 and inserting 1 and1 and by adding at the end the following clause3 7v7 in the case of a vehicle placed in service after ,december #ca1 #bjbf1 #hj percent4 4 7#b7 ,section #cj;,d7e77#b77;,b7 is amended by striking and at the end of clause 7ii71 by striking the period at the end of clause 7iii71 and by adding at the end the following clauses3 7iv7 in the case of a vehicle placed in service during calendar year #bjbg1 #hj percent1 7v7 in the case of a vehicle placed in service during calendar year #bjbh1 #ij percent1 and 7vi7 in the case of a vehicle placed in service after ,december #ca1 #bjbh1 #ajj percent4 4 7c7 ,effective date ,the amendments made by this section shall take effect as if included in section #gjejb of ,public ,law #aai-ba4 #bcjjc4 ,qualified commercial clean vehicles credit 7a7 ,reversion of termination date ,section #de,w7g7 is amended by striking ,september #cj1 #bjbe and inserting ,december #ca1 #bjcb4 7b7 ,clarification of application to mobile machinery 7#a7 ,in general ,section #de,w7c77#b7 is amended-- 7,a7 in subparagraph 7,a71 by striking primarily1 and 7,b7 in subparagraph 7,b71 by striking mobile machinery1 as defined in section #djec7h7 and inserting a vehicle that performs a construction1 manufacturing1 processing1 farming1 mining1 drilling1 timbering1 or similar operation4 7#b7 ,qualified manufacturer and ,,vin requirements not applicable 7,a7 ,qualified manufacturer requirements ,section #de,w7c7 is amended-- 7i7 in paragraph 7#a71 by striking meets the requirements of section #cj;,d7d77#a77;,c7 and1 7ii7 in paragraph 7#b77;,a71 by striking subparagraph 7,d7 and inserting subparagraphs 7,c7 and 7,d71 and 7iii7 in paragraph 7#c71 by striking either-- and inserting meets the requirements of section #cj;,d7d77#a77;,c7 and either--4 7,b7 ,,vin requirements ,section #de,w7e7 is amended by inserting 7other than a vehicle described in subsection 7c77#b77;,b77 after any vehicle4 7c7 ,effective date ,the amendments made by this section shall take effect as if included in section #gjejc of ,public ,law #aai-ba4 #bcjjd4 ,reversion of termination date for alternative fuel vehicle refueling property credit 7a7 ,in general ,section #cj;,c7i7 is amended by striking ,june #cj1 #bjbf and inserting ,december #ca1 #bjcb4 7b7 ,effective date ,the amendment made by this section shall take effect as if included in section #gjejd of ,public ,law #aai-ba4 #bcjje4 ,credit for certain new electric bicycles 7a7 ,in general ,subpart ,c of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provision of this ,act1 is amended by inserting after section #cf;,c the following new section3 #cf;,d4 ,electric bicycles 7a7 ,allowance of credit ,in the case of an individual1 there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to #cj percent of the cost of each qualified electric bicycle placed in service by the taxpayer during such taxable year4 7b7 ,limitations 7#a7 ,limitation on cost per bicycle taken into account ,the amount taken into account under subsection 7a7 as the cost of any qualified electric bicycle shall not exceed #e1jjj4 7#b7 ,limitation on number of bicycles ,in the case of any taxpayer for any taxable year1 the number of qualified electric bicycles taken into account under subsection 7a7 shall not exceed the excess 7if any7 of-- 7,a7 #a 7#b in the case of a joint return71 reduced by 7,b7 the aggregate number of qualified electric bicycles taken into account by the taxpayer under subsection 7a7 for the #b preceding taxable years4 7#c7 ,phaseout based on income 7,a7 ,phaseout based on modified adjusted gross income ,the credit allowed under subsection 7a7 shall be reduced by #ajj for each #a1jjj 7or fraction thereof7 by which the taxpayer's modified adjusted gross income exceeds-- 7i7 #cjj1jjj in the case of a joint return or a surviving spouse 7as defined in section #b7;a771 7ii7 #bbe1jjj in the case of a head of household 7as defined in section #b7;b771 and 7iii7 #aej1jjj in the case of a taxpayer not described in clause 7i7 or 7ii74 7,b7 ,special rule for modified adjusted gross income taken into account ,the modified adjusted gross income of the taxpayer that is taken into account for purposes of subparagraph 7,a7 shall be the lesser of-- 7i7 the modified adjusted gross income for the taxable year with respect to which the credit is claimed1 or 7ii7 the modified adjusted gross income for the immediately preceding taxable year4 7,c7 ,modified adjusted gross income ,for purposes of subparagraph 7,a71 the term modified adjusted gross income means adjusted gross income increased by any amount excluded from gross income under section #iaa1 #ica1 or #icc4 7c7 ,qualified electric bicycle ,for purposes of this section-- 7#a7 ,in general ,the term qualified electric bicycle means a bicycle or tricycle-- 7,a7 the original use of which commences with the taxpayer1 7,b7 which is acquired for use by the taxpayer and not for resale1 7,c7 which is not property of a character subject to an allowance for depreciation or amortization in the hands of the taxpayer1 7,d7 which is made by a qualified manufacturer and is labeled with the qualified vehicle identification number assigned to such bicycle or tricycle by such manufacturer1 7,e7 with respect to which the aggregate amount paid for such acquisition does not exceed #h1jjj1 7,f7 which is a class #a electric bicycle or tricycle1 a class #b electric bicycle or tricycle1 or a class #c electric bicycle or tricycle1 7,g7 which is equipped with-- 7i7 fully operable pedals1 7ii7 a saddle or seat for the rider1 and 7iii7 an electric motor of less than #gej watts which is designed to provide assistance in propelling the bicycle or tricycle and-- 7,i7 does not provide such assistance if the bicycle or tricycle is moving in excess of #bj miles per hour1 or 7,,ii7 if such motor only provides such assistance when the rider is pedaling1 does not provide such assistance if the bicycle or tricycle is moving in excess of #bh miles per hour1 7,h7 which is not equipped with any motor other than the motor described in subparagraph 7,g77iii71 7,i7 which is not capable of exceeding the speed limitation in paragraph 7#b7 by means of any electronic switch1 setting or software modification provided or made available by the manufacturer1 and 7,j7 which has a drive system that has been certified by an accredited laboratory to ,underwriters ,laboratory 7,,ul7 standard ,,ul #bhdi1 or a battery that has been certified to any of the battery safety standards listed in such standard ,,ul #bhdi or such other drive system or battery safety standard as may be recognized by the ,united ,states ,consumer ,product ,safety ,commission4 7#b7 ,class #a electric bicycle or tricycle ,the term class #a electric bicycle or tricycle means a two- or three-wheeled vehicle equipped with an electric motor that provides assistance only when the rider is pedaling1 that is not capable of providing assistance when the speed of the vehicle exceeds #bj miles per hour1 and that is not a class #c electric bicycle or tricycle4 7#c7 ,class #b electric bicycle or tricycle ,the term class #b electric bicycle or tricycle means a two- or three-wheeled vehicle equipped with an electric motor that may be used to propel the vehicle without the need of any additional assistance1 and that is not capable of providing assistance when the speed of the vehicle exceeds #bj miles per hour4 7#d7 ,class #c electric bicycle or tricycle ,the term class #c electric bicycle or tricycle means a two- or three-wheeled vehicle equipped with an electric motor that provides assistance only when the rider is pedaling1 and that is not capable of providing assistance when the speed of the vehicle exceeds #bh miles per hour4 7d7 ,special rule for bicycles used by an individual in a trade or business ,in the case of any bicycle or tricycle with respect to which the taxpayer elects 7at such time and in such manner as the ,secretary may provide7 the application of this subsection-- 7#a7 subsections 7c77#a77;,c7 and 7f77#b7 shall not apply with respect to such bicycle or tricycle1 and 7#b7 no deduction 7including any deduction for depreciation or amortization7 or credit 7other than the credit allowed under this section7 shall be allowed for the cost of such bicycle or tricycle4 7e7 ,,vin number requirement 7#a7 ,in general ,no credit shall be allowed under subsection 7a7 with respect to any qualified electric bicycle unless the taxpayer includes the qualified vehicle identification number of such bicycle on the return of tax for the taxable year4 7#b7 ,qualified vehicle identification number ,for purposes of this section1 the term qualified vehicle identification number means1 with respect to any qualified electric bicycle1 the vehicle identification number assigned to such bicycle by a qualified manufacturer pursuant to the methodology referred to in paragraph 7#c77;,a74 7#c7 ,qualified manufacturer ,for purposes of this section1 the term qualified manufacturer means any manufacturer of qualified electric bicycles which enters into an agreement with the ,secretary which provides that such manufacturer will-- 7,a7 assign a vehicle identification number to each qualified electric bicycle produced by such manufacturer utilizing a methodology that will ensure that such number 7including any alphanumeric7 is unique to such bicycle 7by utilizing numbers or letters which are unique to such manufacturer or by such other method as the ,secretary may provide71 7,b7 label such bicycle with such number in such manner as the ,secretary may provide1 and 7,c7 make periodic written reports to the ,secretary 7at such times and in such manner as the ,secretary may provide7 of the vehicle identification numbers so assigned and including such information as the ,secretary may require with respect to the qualified electric bicycle to which such number was so assigned4 7f7 ,special rules 7#a7 ,basis reduction ,for purposes of this subtitle1 the basis of any property for which a credit is allowable under subsection 7a7 shall be reduced by the amount of such credit so allowed4 7#b7 ,no double benefit ,the amount of any deduction or other credit allowable under this chapter for a qualified electric bicycle for which a credit is allowable under subsection 7a7 shall be reduced by the amount of credit allowed under such subsection for such bicycle4 7#c7 ,property used outside united states not qualified ,no credit shall be allowable under subsection 7a7 with respect to any property referred to in section #ej7;b77#a74 7#d7 ,recapture ,the ,secretary shall1 by regulations or other guidance1 provide for recapturing the benefit of any credit allowable under subsection 7a7 with respect to any property which ceases to be property eligible for such credit4 7#e7 ,election not to take credit ,no credit shall be allowed under subsection 7a7 for any qualified electric bicycle if the taxpayer elects to not have this section apply to such bicycle4 7g7 ,treatment of certain possessions 7#a7 ,payments to possessions with mirror code tax systems ,the ,secretary shall pay to each possession of the ,united ,states which has a mirror code tax system amounts equal to the loss 7if any7 to that possession by reason of the application of the provisions of this section 7determined without regard to this subsection74 ,such amounts shall be determined by the ,secretary based on information provided by the government of the respective possession4 7#b7 ,payments to other possessions ,the ,secretary shall pay to each possession of the ,united ,states which does not have a mirror code tax system amounts estimated by the ,secretary as being equal to the aggregate benefits 7if any7 that would have been provided to residents of such possession by reason of the provisions of this section if a mirror code tax system had been in effect in such possession4 ,the preceding sentence shall not apply unless the respective possession has a plan which has been approved by the ,secretary under which such possession will promptly distribute such payments to its residents4 7#c7 ,mirror code tax system2 treatment of payments ,rules similar to the rules of paragraphs 7#c71 7#d71 and 7#e7 of section #ba7;h7 shall apply for purposes of this section4 7h7 ,transfer of credit 7#a7 ,in general ,subject to such regulations or other guidance as the ,secretary determines necessary or appropriate1 if the taxpayer who acquires a qualified electric bicycle is an individual and elects the application of this subsection with respect to such qualified electric bicycle1 the credit which would 7but for this subsection7 be allowed to such taxpayer with respect to such qualified electric bicycle shall be allowed to the eligible entity specified in such election 7and not to such taxpayer74 7#b7 ,eligible entity ,for purposes of this paragraph1 the term eligible entity means1 with respect to the qualified electric bicycle for which the credit is allowed under subsection 7a71 the retailer which sold such qualified electric bicycle to the taxpayer and has-- 7,a7 subject to paragraph 7#d71 registered with the ,secretary for purposes of this paragraph1 at such time1 and in such form and manner1 as the ,secretary may prescribe1 7,b7 prior to the election described in paragraph 7#a7 and no later than at the time of such sale1 disclosed to the taxpayer purchasing such qualified electric bicycle-- 7i7 the retail price1 7ii7 the value of the credit allowed or other incentive available for the purchase of such qualified electric bicycle1 7iii7 all fees associated with the purchase of such qualified electric bicycle1 and 7iv7 the amount provided by the retailer to such taxpayer as a condition of the election described in paragraph 7#a71 7,c7 made payment to such taxpayer 7whether in cash or in the form of a partial payment or down payment for the purchase of such qualified electric bicycle7 in an amount equal to the credit otherwise allowable to such taxpayer1 and 7,d7 with respect to any incentive otherwise available for the purchase of a qualified electric bicycle for which a credit is allowed under this section1 including any incentive in the form of a rebate or discount provided by the retailer or manufacturer1 ensured that-- 7i7 the availability or use of such incentive shall not limit the ability of a taxpayer to make an election described in paragraph 7#a71 and 7ii7 such election shall not limit the value or use of such incentive4 7#c7 ,timing ,an election described in paragraph 7#a7 shall be made by the taxpayer not later than the date on which the qualified electric bicycle for which the credit is allowed under subsection 7a7 is purchased4 7#d7 ,revocation of registration ,upon determination by the ,secretary that a retailer has failed to comply with the requirements described in paragraph 7#b71 the ,secretary may revoke the registration 7as described in subparagraph 7,a7 of such paragraph7 of such retailer4 7#e7 ,tax treatment of payments ,with respect to any payment described in paragraph 7#b77;,c71 such payment-- 7,a7 shall not be includible in the gross income of the taxpayer1 and 7,b7 with respect to the retailer1 shall not be deductible under this title4 7#f7 ,application of certain other requirements ,in the case of any election under paragraph 7#a7 with respect to any qualified electric bicycle-- 7,a7 the amount of the reduction under subsection 7b7 shall be determined with respect to the modified adjusted gross income of the taxpayer for the taxable year preceding the taxable year in which such qualified electric bicycle was acquired 7and not with respect to such income for the taxable year in which such qualified electric bicycle was acquired71 7,b7 the requirements of paragraphs 7#a7 and 7#b7 of subsection 7f7 shall apply to the taxpayer who acquired the qualified electric bicycle in the same manner as if the credit determined under this section with respect to such qualified electric bicycle were allowed to such taxpayer1 and 7,c7 subsection 7f77#e7 shall not apply4 7#g7 ,advance payment to registered retailers 7,a7 ,in general ,the ,secretary shall establish a program to make advance payments to any eligible entity in an amount equal to the cumulative amount of the credits allowed under subsection 7a7 with respect to any qualified electric bicycles sold by such entity for which an election described in paragraph 7#a7 has been made4 7,b7 ,excessive payments ,rules similar to the rules of section #fdag7;c77#f7 shall apply for purposes of this paragraph4 7#h7 ,retailer ,for purposes of this subsection1 the term retailer means a person engaged in the trade or business of selling qualified electric bicycles in a ,state1 the ,district of ,columbia1 the ,commonwealth of ,puerto ,rico1 or any other territory or possession of the ,united ,states4 4 7b7 ,conforming amendments 7#a7 ,section #ajaf7;a71 as amended by the preceding provisions of this ,act1 is amended by striking and at the end of paragraph 7#ch71 by striking the period at the end of paragraph 7#ci7 and inserting 1 and1 and by adding at the end the following new paragraph3 7#dj7 to the extent provided in section #cf;,d7f77#a74 4 7#b7 ,section #fbaa7;b77#d77;,a71 as amended by the preceding provisions of this ,act1 is amended by inserting #cf;,d1 after #cf;,c14 7#c7 ,section #fbac7;g77#b7 is amended-- 7,a7 in subparagraph 7,z71 by striking and at the end1 7,b7 in subparagraph 7,,aa71 by striking the period at the end and inserting 1 and1 and 7,c7 by adding at the end the following3 7,,bb7 an omission of a correct vehicle identification number required under section #cf;,d7e7 7relating to electric bicycles credit7 to be included on a return4 4 7#d7 ,section #feja7m7 is amended by inserting #cf;,d7f77#e71 after #ce7;g77#aa714 7#e7 ,section #acbd7;b77#b7 of title #ca1 ,united ,states ,code1 as amended by the preceding provisions of this ,act1 is amended by inserting #cf;,d1 after #cf;,c14 7c7 ,clerical amendment ,the table of sections for subpart ,c of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by adding at the end the following new item3 ,sec4 #cf;,d4 ,electric bicycles4 4 7d7 ,effective date ,the amendments made by this section shall apply to property placed in service after the date of the enactment of this ,act1 in taxable years ending after such date4 7e7 ,treasury report ,not later than #c years after the date of the enactment of this ,act1 the ,secretary of the ,treasury 7or the ,secretary's delegate7 shall make publicly available a written report specifying the number of taxpayers claiming the credit allowed under section #cf;,d of the ,internal ,revenue ,code of #aihf 7as added by this section7 and the aggregate dollar amount of such credits so allowed4 ,such information shall be stated separately for taxable years beginning in #bjbf and #bjbg1 and shall be stated separately with respect to each such years with respect to taxpayers in each of the income brackets to which section #a of such ,code applies4 ,d ,lowering costs of clean infrastructure and resiliency #bdjja4 ,qualifying water reuse project credit 7a7 ,in general ,subpart ,e of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by inserting after section #dh;,h the following new section3 #dh;,i4 ,qualifying water reuse project credit 7a7 ,in general ,for purposes of section #df1 the qualifying water reuse project credit for any taxable year is an amount equal to #cj percent of the qualified investment for such taxable year with respect to any qualifying water reuse project of the taxpayer4 7b7 ,qualified investment 7#a7 ,in general ,for purposes of subsection 7a71 the qualified investment with respect to any qualifying water reuse project for any taxable year is the basis of qualified property placed in service by the taxpayer during such taxable year which is part of such qualifying water reuse project4 7#b7 ,qualified property ,for purposes of this subsection1 the term qualified property means property-- 7,a7 which is tangible property1 7,b7 with respect to which depreciation 7or amortization in lieu of depreciation7 is allowable1 and 7,c7 which is-- 7i7 constructed1 reconstructed1 or erected by the taxpayer1 or 7ii7 acquired by the taxpayer if the original use of such property commences with the taxpayer4 7#c7 ,certain qualified progress expenditures rules made applicable ,rules similar to the rules of subsections 7c77#d7 and 7d7 of section #df 7as in effect on the day before the enactment of the ,revenue ,reconciliation ,act of #aiij7 shall apply for purposes of this section4 7c7 ,qualifying water reuse project ,for purposes of this section-- 7#a7 ,in general ,the term qualifying water reuse project means a project which-- 7,a7 installs1 replaces1 or modifies an onsite water recycling system within an industrial1 manufacturing1 data center1 or food processing facility1 7,b7 replaces the use of freshwater1 such as groundwater1 with recycled water from a municipal water provider for the production of goods or provision of services1 or 7,c7 builds or expands a municipal water recycling system for the purpose of securing recycled water for the production of goods or provision of services4 7#b7 ,prevailing wage and apprenticeship requirements ,such term shall not include any project unless such project meets the requirements of paragraph 7#g7 and 7#h7 of section #de7;b74 7d7 ,special rule for certain property transferred to utilities 7#a7 ,in general ,in the case of any qualified transfer property transferred from a person to a utility-- 7,a7 such property shall be treated as qualified property with respect to such person1 7,b7 such person shall be treated as having placed such property in service at the time of such transfer1 7,c7 the basis of such person in such property which is taken into account under subsection 7b77#a7 shall be the basis of such person in such property at the time of such transfer1 and 7,d7 such property shall not be taken into account for purposes of determining any credit allowed under this section to such utility4 7#b7 ,qualified transfer property ,for purposes of this subsection1 the term qualified transfer property means property transferred from a person to a utility if-- 7,a7 such property is qualified property with respect to such utility1 and 7,b7 such person and such utility enter into a binding written agreement under which such person is treated as eligible for the credit allowed under this section with respect to such property in lieu of such utility4 7e7 ,termination ,this section shall not apply to any property the construction of which begins after ,december #ca1 #bjcb4 4 7b7 ,part of investment credit ,section #df1 as amended by the preceding provisions of this ,act1 is amended by striking and at the end of paragraph 7#i71 by striking the period at the end of paragraph 7#aj7 and inserting 1 and1 and by adding at the end the following new paragraph3 7#aa7 the qualifying water reuse project credit4 4 7c7 ,clerical amendment ,the table of sections for subpart ,d of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by inserting after the item relating to section #dh;,h the following new item3 ,sec4 #dh;,i4 ,qualifying water reuse project credit4 4 7d7 ,effective date ,the amendments made by this section shall apply to periods after the date of the enactment of this section under rules similar to the rules of section #dh7m7 of the ,internal ,revenue ,code of #aihf 7as in effect on the date of the enactment of the ,revenue ,reconciliation ,act of #aiij74 #bdjjb4 ,recycling property investment credit 7a7 ,in general ,subpart ,e of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by inserting after section #dh;,i the following new section3 #dh;,j4 ,recycling property investment credit 7a7 ,in general ,for purposes of section #df1 the recycling property investment credit for any taxable year is an amount equal to #cj percent of the qualified investment for such taxable year4 7b7 ,qualified investment 7#a7 ,in general ,for purposes of subsection 7a71 the qualified investment for any taxable year is the basis of any eligible property placed in service by the taxpayer during such taxable year4 7#b7 ,eligible property ,for purposes of this section-- 7,a7 ,in general ,the term eligible property means property-- 7i7 which is qualified recycling property1 7ii7 with respect to which depreciation 7or amortization in lieu of depreciation7 is allowable1 and 7iii7 7,i7 the construction1 reconstruction1 addition1 or erection of which is completed by the taxpayer1 or 7,,ii7 which is acquired by the taxpayer if the original use of such property commences with the taxpayer1 and 7,b7 ,prevailing wage and apprenticeship requirements ,such term shall not include any property unless such property meets the requirements of paragraph 7#g7 and 7#h7 of section #de7;b74 7c7 ,special rules ,for purposes of this section-- 7#a7 ,certain progress expenditure rules made applicable ,rules similar to the rules of subsections 7c77#d7 and 7d7 of section #df 7as in effect on the day before the date of the enactment of the ,revenue ,reconciliation ,act of #aiij7 shall apply4 7#b7 ,special rule for certain subsidized property ,rules similar to section #de7;b77#c7 shall apply4 7#c7 ,domestic content bonus credit amount 7,a7 ,in general ,in the case of any qualified investment which satisfies the requirement under subparagraph 7,b71 the amount of the credit determined under subsection 7a7 7determined without regard to this paragraph before the application of subsection 7d7 and after the application of any other provision of this section7 shall be increased by an amount equal to #aj percentage points of the amount so determined4 7,b7 ,requirement ,rules similar to the rules of section #de7;b77#i77;,b7 shall apply4 7#d7 ,phaseout for elective payment ,in the case of a taxpayer making an election under section #fdag with respect to a credit under this section1 rules similar to the rules of section #de7;b77#aj7 shall apply4 7d7 ,credit phase-,out 7#a7 ,in general ,the amount of the credit determined under subsection 7a7 with respect to any qualified investment shall be equal to the product of-- 7,a7 the amount of the credit determined under subsection 7a7 without regard to this subsection1 multiplied by 7,b7 the phase-out percentage under paragraph 7#b74 7#b7 ,phase-out percentage ,the phase-out percentage under this paragraph is equal to-- 7,a7 in the case of any eligible property with a determination date beginning on or after ,january #a1 #bjbf1 and before ,december #ca1 #bjcb1 #ajj percent1 7,b7 in the case of any eligible property with a determination date beginning on or after ,january #a1 #bjcc1 and before ,december #ca1 #bjcc1 #hj percent1 7,c7 in the case of any eligible property with a determination date beginning on or after ,january #a1 #bjcd1 and before ,december #ca1 #bjcd1 #fj percent1 7,d7 in the case of any eligible property with a determination date beginning on or after ,january #a1 #bjce1 and before ,december #ca1 #bjce1 #dj percent1 7,e7 in the case of any eligible property with a determination date beginning on or after ,january #a1 #bjcf1 and before ,december #ca1 #bjcf1 #bj percent1 and 7,f7 in the case of any eligible property with a determination date beginning on or after ,january #a1 #bjcg1 #j percent4 7#c7 ,determination date ,for purposes of paragraph 7#b71 the determination date of an eligible property is-- 7,a7 in the case such property is described in subsection 7b77#b77;,c77i71 the date on which the construction1 reconstruction1 addition1 or erection of such property begins1 and 7,b7 in any other case1 the date on which such property is placed in service4 7e7 ,denial of double benefit ,in the case of any eligible property with respect to which credit is allowed under subsection 7a7-- 7#a7 no other credit or deduction shall be allowed for1 or by reason of1 such property to the extent of the amount of such credit1 and 7#b7 the basis of such property shall be reduced by the amount of such credit4 7f7 ,regulations and guidance ,the ,secretary shall issue such regulations or other guidance as the ,secretary determines necessary to carry out the purposes of this section1 including regulations or other guidance which provides for requirements for recordkeeping or information reporting for purposes of administering the requirements of this section4 7g7 ,definitions ,for purposes of this section-- 7#a7 ,qualified recycling property ,the term qualified recycling property has the meaning given the term reuse and recycling property in section #afh7m77#c77;,a74 7#b7 ,qualified reuse and recyclable materials ,the term qualified reuse and recyclable materials has the meaning given such term in section #afh7m77#c77;,b71 except that for purposes of this section such term includes any video display device and any computer device 7including computer peripherals1 such as keyboards1 mice1 speakers1 cables1 printers1 and scanners74 7#c7 ,recycle ,the term recycle has the meaning given such term in section #afh7m77#c77;,c71 except that for purposes of this section such term does not include-- 7,a7 any method of sorting1 processing1 and aggregating materials from solid waste that-- 7i7 does not preserve the original quality of such materials1 and 7ii7 results in the aggregated material not being usable-- 7,i7 for the initial purpose 7or a substantially similar purpose7 of such materials1 or 7,,ii7 as feedstock in lieu of virgin feedstock in the production of specification grade commodities1 or 7,b7 the primary use of waste or qualified reuse and recyclable materials-- 7i7 as a fuel or fuel substitute2 7ii7 for the production or generation of energy 7including heat and electricity72 7iii7 for incineration2 7iv7 for alternate operating cover2 or 7v7 within the footprint of a landfill4 4 7b7 ,credit made part of investment credit ,section #df1 as amended by the preceding provisions of this ,act1 is amended by striking and at the end of paragraph 7#aj71 by striking the period at the end of paragraph 7#aa7 and inserting 1 and1 and by adding at the end the following new paragraph3 7#ab7 the recycling property investment credit4 4 7c7 ,clerical amendment ,the table of sections for subpart ,e of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by inserting after the item relating to section #dh;,i the following new item3 #dh;,j4 ,recycling property investment credit4 4 7d7 ,effective date ,the amendments made by this section shall apply to-- 7#a7 in the case of property described in section #dh;,j7b77#b77;,c77i7 of the ,internal ,revenue ,code of #aihf 7as added by subsection 7a771 property which is constructed1 reconstructed1 added1 or erected after ,december #ca1 #bjbe1 and 7#b7 in any other case1 property which is placed in service after ,december #ca1 #bjbe4 #bdjjc4 ,exclusion of amounts received from ,state-based catastrophe loss mitigation programs 7a7 ,in general ,section #aci is amended by redesignating subsection 7h7 as subsection 7i7 and by inserting after subsection 7g7 the following new subsection3 7h7 ,state-,based catastrophe loss mitigation programs 7#a7 ,in general ,gross income shall not include any amount received by an individual as a qualified catastrophe loss mitigation payment under a program established or administered by a ,state1 or a political subdivision or instrumentality thereof1 for the purpose of making such payments4 7#b7 ,qualified catastrophe loss mitigation payment ,for purposes of this section1 the term qualified catastrophe loss mitigation payment means any amount which is received by an individual to make improvements to such individual's residence for the sole purpose of hazard mitigation with respect to such residence4 7#c7 ,no increase in basis ,rules similar to the rules of subsection 7g77#c7 shall apply in the case of this subsection4 4 7b7 ,conforming amendments 7#a7 ,section #aci7;d7 is amended by striking and qualified and inserting 1 qualified catastrophe mitigation payments1 and qualified4 7#b7 ,section #aci7;i7 7as redesignated by subsection 7a77 is amended by striking or qualified and inserting 1 qualified catastrophe mitigation payment1 or qualified4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #bdjjd4 ,exclusion from gross income of certain emergency agricultural assistance 7a7 ,in general ,section #aci1 as amended by the preceding provisions of this ,act1 is amended by redesignating subsection 7i7 as subsection 7j7 and by inserting after subsection 7h7 the following new subsection3 7i7 ,certain agricultural assistance ,for purposes of this section1 the term qualified disaster relief payment shall include any assistance received under any of the following3 7#a7 ,assistance received under the ,wildfires and ,hurricanes ,indemnity ,program ,plus under subpart ,o of part #gfj of title #g1 ,code of ,federal ,regulations4 7#b7 ,assistance received under section #aeja of the ,agricultural ,act of #bjad 7#g ,u4,s4,c4 #ijha74 7#c7 ,noninsured crop assistance under section #aif of the ,federal ,agriculture ,improvement and ,reform ,act of #aiif 7#g ,u4,s4,c4 #gccc74 7#d7 ,assistance under a food assistance program under part #i of title #g1 ,code of ,federal ,regulations4 7#e7 ,assistance under title ,,iv of the ,agricultural ,credit ,act of #aigh 7#af ,u4,s4,c4 #bbja et seq474 7#f7 ,assistance under the ,quality ,loss ,assistance ,program4 4 7b7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #bdjje4 ,credit for disaster mitigation expenditures 7a7 ,in general ,subpart ,b of part ,,iv of subchapter ,a of chapter #a is amended by inserting after section #bg the following new section3 #bh4 ,disaster mitigation expenditures 7a7 ,in general ,there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to #cj percent of the expenditures paid for qualifying mitigation activities paid or incurred by the taxpayer during such taxable year with respect to real property owned or leased by the taxpayer4 7b7 ,qualifying mitigation activities ,for purposes of this section1 the term qualifying mitigation activity means an activity relating to a housing unit-- 7#a7 for property to-- 7,a7 improve the strength of a roof deck attachment2 7,b7 create a secondary water barrier to prevent water intrusion or mitigate against potential water intrusion from wind-driven rain2 7,c7 improve the durability1 impact resistance 7not less than class #c or #d rating71 or fire resistance 7not less than class ,a rating7 of a roof covering2 7,d7 brace gable-end walls2 7,e7 reinforce the connection between a roof and supporting wall2 7,f7 protect openings from penetration by wind-borne debris2 7,g7 protect exterior doors and garages from natural hazards2 7,h7 complete measures contained in the publication of the ,federal ,emergency ,management ,agency entitled ,wind ,retrofit ,guide for ,residential ,buildings 7,p-#hjd72 7,i7 elevate the qualified dwelling unit1 as well as utilities1 machinery1 or equipment1 above the base flood elevation or other applicable minimum elevation requirement2 7,j7 seal walls in the basement of the qualified dwelling unit using waterproofing compounds2 or 7,k7 protect propane tanks or other external fuel sources2 7#b7 to install-- 7,a7 check valves to prevent flood water from backing up into drains2 7,b7 flood vents1 breakaway walls or open lattice for homes located in ,v zones2 7,c7 a stormwater drainage system or improve an existing system2 7,d7 natural or nature-based features for flood control1 including living shorelines2 7,e7 roof coverings1 sheathing1 flashing1 roof and attic vents1 eaves1 or gutters that conform to ignition-resistant construction standards2 7,f7 wall components for wall assemblies that conform to ignition-resistant construction standards2 7,g7 a wall-to-foundation anchor or connector1 or a shear transfer anchor or connector2 7,h7 wood structural panel sheathing for strengthening cripple walls2 7,i7 anchorage of the masonry chimney to the framing2 7,j7 prefabricated lateral resisting systems2 7,k7 a standby generator system consisting of a standby generator and an automatic transfer switch2 7,l7 a storm shelter that meets the design and construction standards established by the ,international ,code ,council and the ,national ,storm ,shelter ,association 7,,icc-#ejj71 or a safe room that satisfies the criteria contained in-- 7i7 the publication of the ,federal ,emergency ,management ,agency entitled ,safe ,rooms for ,tornadoes and ,hurricanes 7,p-#cfa72 or 7ii7 the publication of the ,federal ,emergency ,management ,agency entitled ,taking ,shelter from the ,storm 7,p-#cbj72 7,m7 a lightning protection system2 7,n7 exterior walls1 doors1 windows1 or other exterior dwelling unit elements that conform to ignition-resistant construction standards2 7,o7 exterior deck or fence components that conform to ignition-resistant construction standards2 7,p7 structure-specific water hydration systems1 including fire mitigation systems such as interior sprinkler systems2 7,q7 flood openings for fully enclosed areas below the lowest floor of the dwelling unit2 7,r7 lateral bracing for wall elements1 foundation elements1 and garage doors or other large openings to resist seismic loads2 or 7,s7 automatic shutoff valves for water and gas lines2 7#c7 for services or equipment to-- 7,a7 create buffers around the qualified dwelling unit through the removal or reduction of flammable vegetation1 including vertical clearance of tree branches2 7,b7 create buffers around the dwelling unit through-- 7i7 the removal of exterior deck or fence components or ignition-prone landscape features2 or 7ii7 replacement of the components or features described in clause 7i7 with components or features that conform to ignition-resistant construction standards2 7,c7 perform fire maintenance procedures identified by the ,federal ,emergency ,management ,agency or the ,united ,states ,forest ,service1 including fuel management techniques such as creating fuel and fire breaks2 or 7,d7 replace flammable vegetation with less flammable species2 7#d7 for property relating to satisfying the standards required for receipt of a ,,fortified designation from the ,insurance ,institute for ,business and ,home ,safety1 provided that the qualified dwelling unit receives such designation following installation of such property2 7#e7 for property relating to satisfying the standards required for receipt of a ,wildfire ,prepared ,homes designation from the ,insurance ,institute for ,business and ,home ,safety1 provided that the qualified dwelling unit receives such designation following installation of such property2 or 7#f7 for any other hazard mitigation activity identified by the ,president1 in consultation with the ,administrator of the ,federal ,emergency ,management ,agency1 for mitigation of a natural hazard4 7c7 ,application with other credits 7#a7 ,business credit treated as part of general business credit ,so much of the credit which would be allowed under subsection 7a7 for any taxable year 7determined without regard to this subsection7 that is attributable to expenditures made in the ordinary course of the taxpayer's trade or business 7or1 in the case of expenditures made by a ,state1 would have been expenditures made in the ordinary course of the taxpayer's trade or business if made by the taxpayer7 shall be treated as a credit listed in section #ch7;b7 for taxable year 7and not allowed under subsection 7a774 7#b7 ,personal credit ,for purposes of this title1 the credit allowed under subsection 7a7 for any taxable year 7determined after application of paragraph 7#a77 shall be treated as a credit allowable under subpart ,a for such taxable year4 7d7 ,reduction of credit percentage where taxpayer expenditures less than #cj percent 7#a7 ,in general ,if the expenditure percentage with respect to any item of expenditure described under subsection 7a7 is less than #cj percent1 subsection 7a7 shall be applied by substituting the expenditure percentage for #cj percent with respect to such item of expenditure4 7#b7 ,expenditure percentage ,for purposes of this section1 the term expenditure percentage means1 with respect to any item of expenditure described under subsection 7a7 any portion of which is paid or incurred by a ,state1 the ratio 7expressed as a percentage7 of-- 7,a7 the taxpayer's expenditure for such item1 divided by 7,b7 the sum of the taxpayer's and such ,state's expenditures for such item4 7e7 ,special rules 7#a7 ,treatment of expenditures related to marketable timber ,an expenditure shall not be taken into account for purposes of this section 7whether made by the taxpayer or a ,state7 if such expenditure is properly allocable to timber which is sold or exchanged by the taxpayer4 ,the preceding sentence shall not apply to the extent that such amount exceeds the gain on such sale or exchange4 7#b7 ,treatment of reimbursements ,any amount originally paid or incurred by the taxpayer which is reimbursed by a ,state under a qualified ,state disaster mitigation program shall be treated as paid by such ,state 7and not by such taxpayer74 7#c7 ,basis reduction ,for purposes of this subtitle1 if the basis of any property would 7but for this paragraph7 be determined by taking into account any expenditure described under subsection 7a71 the basis of such property shall be reduced by the amount of the credit allowed under subsection 7a7 with respect to such expenditure 7determined without regard to subsection 7c774 7#d7 ,denial of double benefit ,the amount of any deduction or other credit allowable under this chapter for any expenditure for which a credit is allowable under subsection 7a7 shall be reduced by the amount of credit allowed under such subsection for such expenditure 7determined without regard to subsection 7c774 4 7b7 ,conforming amendments 7#a7 ,section #ch7;b71 as amended by the preceding provisions of this ,act1 is amended by striking plus at the end of paragraph 7#db71 by striking the period at the end of paragraph 7#dc7 and inserting 1 plus1 and by adding at the end the following new paragraph3 7#dd7 the portion of the disaster mitigation expenditures credit to which section #bh7;c77#a7 applies4 4 7#b7 ,section #ajaf7;a71 as amended by the preceding provisions of this ,act1 is amended by striking and at the end of paragraph 7#ci71 by striking the period at the end of paragraph 7#dj7 and inserting 1 and1 and by adding at the end the following new paragraph3 7#da7 to the extent provided in section #bh7;e77#b74 4 7#c7 ,the table of sections for subpart ,b of part ,,iv of subchapter ,a of chapter #a is amended by inserting after the item relating to section #bg the following new item3 ,sec4 #bh4 ,qualified disaster mitigation expenditures4 4 7c7 ,effective date ,the amendments made by this section shall apply to expenditures paid or incurred after the date of the enactment of this ,act1 in taxable years ending after such date4 #bdjjf4 ,establishment of electric power transmission line credit 7a7 ,in general ,subpart ,e of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by inserting after section #dh;,f the following new section3 #dh;,g4 ,qualifying electric power transmission line credit 7a7 ,allowance of credit ,for purposes of section #df1 the qualifying electric power transmission line credit for any taxable year is an amount equal to #cj percent of the qualified investment for such taxable year with respect to any qualifying electric power transmission line property of the taxpayer4 7b7 ,qualifying investment 7#a7 ,in general ,for purposes of subsection 7a71 the qualified investment for any taxable year is the basis of any qualifying electric power transmission line property placed in service by the taxpayer during such taxable year4 7#b7 ,certain qualified progress expenditures rules made applicable ,rules similar to the rules of subsections 7c77#d7 and 7d7 of section #df 7as in effect on the day before the enactment of the ,revenue ,reconciliation ,act of #aiij7 shall apply for purposes of this section4 7c7 ,qualifying electric power transmission line property ,for purposes of this section-- 7#a7 ,in general ,the term qualifying electric power transmission line property means any overhead1 submarine1 or underground property-- 7,a7 which is a qualifying electric power transmission line that transmits electricity-- 7i7 across not less than #b ,states or not less than #aej continuous miles1 or 7ii7 across the ,outer ,continental ,shelf 7as defined in section #b of the ,outer ,continental ,lands ,act 7#dc ,u4,s4,c4 #acca771 or 7,b7 which is related transmission property4 7#b7 ,prevailing wage and apprenticeship requirements ,such term shall not include any property unless such property meets the requirements of paragraph 7#g7 and 7#h7 of section #de7;b74 7d7 ,qualifying electric power transmission line ,for purposes of this section-- 7#a7 ,in general ,the term qualifying electric power transmission line means any of the following3 7,a7 ,new transmission property 7i7 ,in general ,any electric power transmission line which is-- 7,i7 originally placed in service after the date of enactment of this section1 7,,ii7 primarily used for one or more purposes described in clause 7ii71 and 7,,iii7 described in clause 7iv74 7ii7 ,purposes described ,the purposes described in this clause are-- 7,i7 enhancing resilience to prepare for1 withstand1 and recover rapidly from disruptions from the impact of weather events1 wildfires1 or natural disasters1 7,,ii7 addressing clearance concerns1 7,,iii7 facilitating the interconnection of electric generation capacity to the bulk-power system 7as defined in section #bae of the ,federal ,power ,act71 or 7,,iv7 addressing high load needs of #b1jjj ampere and above4 7iii7 ,multiple transmission lines located in the same right-of-way ,a transmission line is described in this clause if such a transmission line-- 7,i7 is co-located in the same right-of-way or adjacent right-of-way as one or more other overhead1 submarine1 or underground transmission lines1 and 7,,ii7 together with the other transmission lines described in subclause 7,i71 has a transmission capacity of not less than #a1jjj megawatts4 7iv7 ,additional requirements for new transmission property ,an electric power transmission line is described in this clause if-- 7,i7 such transmission line-- 7aa7 includes an advanced transmission conductor1 and 7bb7 is capable of transmitting electricity at a voltage of not less than #ajj kilovolts1 or 7,,ii7 such transmission line-- 7aa7 is-- 7,,aa7 capable of transmitting electricity at a voltage of not less than #cde kilovolts1 or 7,,bb7 a superconducting transmission line1 and 7bb7 has a transmission capacity of not less than #gej megawatts or is a transmission line described in clause 7iii74 7,b7 ,modification of existing transmission property ,any electric power transmission line which-- 7i7 was placed in service before the date of the enactment of this section1 7ii7 is modified after the date of the enactment of this ,act in a manner that increases the transmission capacity of such transmission line by not less than #ejj megawatts1 and 7iii7 after the completion of such modification1 is an electric power transmission line which satisfies the requirements under subclauses 7,,ii7 and 7,,iii7 of subparagraph 7,a77i74 7#b7 ,advanced transmission conductor ,the term advanced transmission conductor means a transmission conductor technology that uses recently developed technology or materials such as a composite core and such other future advances as determined by the ,secretary1 in consultation with the ,secretary of ,energy4 7#c7 ,superconducting transmission line ,the term superconducting transmission line means a transmission line that conducts all of its current over a super-conducting material4 7e7 ,related transmission property ,for purposes of this section-- 7#a7 ,in general ,the term related transmission property means any of the following3 7,a7 ,transmission property used for interconnection or generator tie-line ,any electric power transmission line which is-- 7i7 placed in service after the date of enactment of this section1 7ii7 primarily used-- 7,i7 as a generator interconnection tie line at an associated facility that extends from the secondary 7high7 side of a generator step-up transformer to the point of interconnection with the host transmission owner from interconnecting new generation resources or facilities to the electric grid1 or 7,,ii7 for network upgrades associated with the interconnection of new generation resources or facilities to the electric grid1 7iii7 primarily used for one or more purposes described in subparagraph 7d77#a77;,a77ii71 and 7iv7 capable of transmitting electricity at a voltage of not less than #bcj kilovolts4 7,b7 ,grid enhancing technology ,any grid enhancing technology property used in the operation of the electric power transmission line described in subparagraph 7,a7 or 7,b7 of subsection 7d77#a74 7,c7 ,subcomponents ,any conductors or cables1 towers1 insulators1 reactors1 capacitors1 circuit breakers1 static ,,var compensators1 static synchronous compensators1 power converters1 transformers1 synchronous condensers1 braking resistors1 and any ancillary facilities and equipment necessary for the proper operation of the electric transmission line described in subparagraph 7,a7 or 7,b7 of subsection 7d77#a7 or for the proper operation of any property described in subsection 7#a77;,a74 7#b7 ,grid enhancing technology property ,the term grid enhancing technology property means power flow controls and transmission switching equipment1 storage technology1 and hardware or software that enables dynamic line ratings1 advanced line rating management technologies1 on new or existing transmission property for the purpose of enhancing the capacity1 efficiency1 resiliency1 or reliability of an electric power transmission system and such other similar property determined by the ,secretary1 in consultation with the ,secretary of ,energy4 7f7 ,termination ,this section shall not apply to any property the construction of which begins after ,december #ca1 #bjcc4 4 7b7 ,public utility property ,paragraph 7#b7 of section #ej7;d7 is amended-- 7#a7 by striking 7as defined in section #dh7;c77#f77 and inserting 7as defined in section #dh7;c77#f71 except that subparagraph 7,d7 of such section shall not apply7 or any qualifying electric power transmission line property 7as defined by section #dh;,g7c771 and 7#b7 in subparagraph 7,b7-- 7,a7 by inserting or qualifying electric transmission line property after each energy storage technology1 and 7,b7 by inserting or the qualifying electric transmission line property after the energy storage technology4 7c7 ,transfer of certain credits ,section #fdah7;f77#a77;,a71 as amended by the preceding provisions of this ,act1 is amended by adding the following new clause3 7xiv7 ,the qualifying electric power transmission line credit under section #dh;,g4 4 7d7 ,conforming amendments 7#a7 ,section #df1 as amended by the preceding provisions of this ,act1 is amended-- 7,a7 by striking and at the end of paragraph 7#g71 7,b7 by striking the period at the end of paragraph 7#h7 and inserting 1 and1 and 7,c7 by adding at the end the following new paragraph3 7#i7 the qualifying electric power transmission line credit4 4 7#b7 ,section #di7;a77#a77;,c71 as amended by the preceding provisions of this ,act1 is amended-- 7,a7 by striking and at the end of clause 7viii71 7,b7 by striking the period at the end of clause 7ix7 and inserting 1 and1 and 7,c7 by adding at the end the following new clause3 7x7 the basis of any qualifying electric power transmission line property under section #dh;,g4 4 7#c7 ,the table of sections for subpart ,e of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by inserting after the item relating to section #dh;,f the following new item3 ,sec4 #dh;,g4 ,qualifying electric power transmission line credit4 4 7e7 ,effective date ,the amendments made by this section shall apply to property placed in service after ,december #ca1 #bjbe4 #bdjjg4 ,qualifying advanced battery project credit 7a7 ,in general ,subpart ,e of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by inserting after section #dh;,g the following new section3 #dh;,h4 ,qualifying advanced battery project credit 7a7 ,in general ,for purposes of section #df1 the qualifying advanced battery project credit for any taxable year is an amount equal to #cj percent of the qualified investment for such taxable year with respect to any qualifying advanced battery project of the taxpayer4 7b7 ,qualified investment 7#a7 ,in general ,for purposes of subsection 7a71 the qualified investment for any taxable year is the basis of eligible property placed in service by the taxpayer during such taxable year which is part of a qualifying advanced battery project4 7#b7 ,certain qualified progress expenditures rules made applicable ,rules similar to the rules of subsections 7c77#d7 and 7d7 of section #df 7as in effect on the day before the enactment of the ,revenue ,reconciliation ,act of #aiij7 shall apply for purposes of this section4 7#c7 ,limitation ,the amount which is treated as the qualified investment for all taxable years with respect to any qualifying advanced battery project shall not exceed the amount designated by the ,secretary as eligible for the credit under this section4 7c7 ,definitions ,for purposes of this section-- 7#a7 ,qualifying advanced battery project ,the term qualifying advanced battery project means a project1 any portion of the qualified investment of which is certified by the ,secretary under subsection 7e7 as eligible for a credit under this section1 which re-equips1 expands1 or establishes a qualified advanced battery manufacturing and research facility4 7#b7 ,qualified advanced battery manufacturing and research facility ,the term qualified advanced battery manufacturing or research facility-- 7,a7 means a facility-- 7i7 located within the ,united ,states1 and 7ii7 primarily used for the production or research and development of batteries or battery components employing advanced chemistries or technologies that improve battery performance1 fire safety1 and longevity1 including-- 7,i7 solid-state lithium metal batteries1 7,,ii7 lithium-sulfur batteries1 7,,iii7 metal-air batteries1 7,,iv7 sodium-ion batteries1 and 7,v7 such other chemistries or technologies as the ,secretary1 after consultation with the ,secretary of ,energy1 determines to offer significant advancements over traditional lithium-ion technology with respect to performance or fire safety1 and 7,b7 does not include facilities which produce only traditional lithium-ion batteries without incorporating advanced chemistries or technologies described in subparagraph 7,a77ii74 7d7 ,qualifying advanced battery project program 7#a7 ,establishment 7,a7 ,in general ,not later than #ahj days after the date of enactment of this section1 the ,secretary1 in consultation with the ,secretary of ,energy1 shall establish a qualifying advanced battery project program to consider and award certifications for qualified investments eligible for credits under this section to qualifying advanced battery project sponsors4 7,b7 ,limitation ,the total amount of credits that may be allocated under the program shall not exceed #c1jjj1jjj1jjj4 7#b7 ,certification 7,a7 ,application period ,each applicant for certification under this paragraph shall submit an application containing such information as the ,secretary may require during the #b-year period beginning on the date the ,secretary establishes the program under paragraph 7#a74 7,b7 ,time to meet criteria for certification ,each applicant for certification shall have #a year from the date of acceptance by the ,secretary of the application during which to provide to the ,secretary evidence that the requirements of the certification have been met4 7,c7 ,period of issuance ,an applicant which receives a certification shall have #c years from the date of issuance of the certification in order to place the project in service and if such project is not placed in service by that time period1 then the certification shall no longer be valid4 7#c7 ,selection criteria ,rules similar to the rules of section #dh;,c7d77#c7 shall apply4 7#d7 ,review and redistribution 7,a7 ,review ,not later than #d years after the date of enactment of this section1 the ,secretary shall review the credits allocated under this section as of such date4 7,b7 ,redistribution ,the ,secretary may reallocate credits awarded under this section if the ,secretary determines that-- 7i7 there is an insufficient quantity of qualifying applications for certification pending at the time of the review1 or 7ii7 any certification made pursuant to paragraph 7#b7 has been revoked pursuant to paragraph 7#b77;,b7 because the project subject to the certification has been delayed as a result of third party opposition or litigation to the proposed project4 7,c7 ,reallocation ,if the ,secretary determines that credits under this section are available for reallocation pursuant to the requirements set forth in paragraph 7#b71 the ,secretary is authorized to conduct an additional program for applications for certification4 7#e7 ,disclosure of allocations ,the ,secretary shall1 upon making an allocation under this subsection1 publicly disclose the identity of the applicant and the amount of the credit with respect to such applicant4 7e7 ,denial of double benefit ,no credit shall be allowed under this section for any qualified investment for which a credit is allowed under another provision of this title4 7f7 ,regulations and guidance ,the ,secretary1 after consultation with the ,secretary of ,energy1 shall issue such regulations and guidance as necessary to implement this section1 including the publication of an annual list of advanced chemistries or technologies under subsection 7c77#b74 4 7b7 ,credit eligible for elective payment ,section #fdag7;b7 is amended by adding at the end the following new paragraph3 7#ac7 ,the qualifying advanced battery project credit determined under section #dh;,h4 4 7c7 ,credit transferable ,section #fdah7;f77#a77;,a71 as amended by the preceding provisions of this ,act1 is amended by adding at the end the following new clause3 7xv7 ,the qualifying advanced battery project credit determined under section #dh;,h4 4 7d7 ,conforming amendments 7#a7 ,section #df1 as amended by the preceding provisions of this ,act1 is amended by striking and at the end of paragraph 7#h71 by striking the period at the end of paragraph 7#i7 and inserting 1 and1 and by adding at the end the following new paragraph3 7#aj7 the qualifying advanced battery project credit4 4 7#b7 ,section #di7;a77#a77;,c71 as amended by the preceding provisions of this ,act1 is amended by striking and at the end of clause 7ix71 by striking the period at the end of clause 7x7 and inserting 1 and1 and by adding at the end the following new clause3 7xi7 the basis of any property which is part of a qualified advanced battery manufacturing or research facility under section #dh;,h4 4 7#c7 ,section #ej7;a77#b77;,e71 as amended by the preceding provisions of this ,act1 is amended by striking or #dh;,f7f7 and inserting #dh;,f7f71 or #dh;,h7c77#e74 7#d7 ,the table of sections for subpart ,e of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by inserting after the item relating to section #dh;,g the following new item3 ,sec4 #dh;,h44,qualifying advanced battery project credit4 4 7e7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 ,,iii ,child and dependent care ,a ,child tax credit #cajja4 ,establishment of refundable child tax credit with monthly advance payment 7a7 ,in general ,subpart ,a of part ,,iv of subchapter ,a of chapter #a is amended by inserting after section #bd the following new sections3 #bd;,a4 ,monthly child tax credit 7a7 ,allowance of credit ,there shall be allowed as a credit against the tax imposed by this chapter for the taxable year the sum of the monthly specified child allowances determined with respect to the taxpayer under subsection 7b7 for each calendar month during such taxable year4 7b7 ,monthly specified child allowance 7#a7 ,in general ,for purposes of this section1 the term monthly specified child allowance means1 with respect to any taxpayer for any calendar month1 the sum of-- 7,a7 #cjj1 with respect to each specified child of such taxpayer who will 7as of the close of such month7 have attained age #f1 plus 7,b7 #abj percent of the dollar amount in effect for such month under subparagraph 7,a71 with respect to each specified child of such taxpayer who will not 7as of the close of such month7 have attained age #f4 ,in the case of any specified child of such taxpayer who will not 7as of the close of such month7 have attained the age of #a month1 subparagraph 7,b7 shall be applied by substituting #hjj percent for #abj percent4 7#b7 ,limitations based on modified adjusted gross income 7,a7 ,initial reduction ,the monthly specified child allowance otherwise determined under paragraph 7#a7 with respect to any taxpayer for any calendar month shall be reduced 7but not below zero7 by #a_/ab of #e percent of the excess 7if any7 of the taxpayer's modified adjusted gross income for the applicable taxable year over the initial threshold amount in effect for such applicable taxable year4 7,b7 ,limitation on initial reduction ,the amount of the reduction under subparagraph 7,a7 shall not exceed the lesser of-- 7i7 the excess 7if any7 of-- 7,i7 the monthly specified child allowance with respect to the taxpayer for such calendar month 7determined without regard to this paragraph71 over 7,,ii7 the amount which would be determined under subclause 7,i7 if the dollar amounts in effect under subparagraphs 7,a7 and 7,b7 of paragraph 7#a7 were each equal to #aff4fg1 or 7ii7 #a_/ab of #e percent of the excess of the secondary threshold amount over the initial threshold amount4 7,c7 ,secondary reduction ,the monthly specified child allowance otherwise determined under paragraph 7#a7 with respect to any taxpayer for such calendar month 7determined after the application of subparagraphs 7,a7 and 7,b77 shall be reduced 7but not below zero7 by #a_/ab of #e percent of the excess 7if any7 of the taxpayer's modified adjusted gross income for the applicable taxable year over the secondary threshold amount4 7,d7 ,definitions related to limitations based on modified adjusted gross income ,for purposes of this paragraph-- 7i7 ,initial threshold amount ,the term initial threshold amount means-- 7,i7 #aej1jjj1 in the case of a joint return or surviving spouse 7as defined in section #b7;a771 7,,ii7 #a_/b the dollar amount in effect under subclause 7,i71 in the case of a married individual filing a separate return1 and 7,,iii7 #aab1ejj1 in any other case4 7ii7 ,secondary threshold amount ,the term secondary threshold amount means-- 7,i7 #djj1jjj1 in the case of a joint return or surviving spouse 7as defined in section #b7;a771 7,,ii7 #bjj1jjj1 in the case of a married individual filing a separate return1 and 7,,iii7 #cjj1jjj1 in any other case4 7iii7 ,applicable taxable year ,the term applicable taxable year means1 with respect to any taxable year for which the credit under this section is determined-- 7,i7 such taxable year1 or 7,,ii7 if the taxpayer elects the application of this subclause 7at such time and in such form and manner as the ,secretary may provide71 the preceding taxable year or the second preceding taxable year 7as specified in such election74 7iv7 ,modified adjusted gross income ,the term modified adjusted gross income means adjusted gross income increased by any amount excluded from gross income under section #iaa1 #ica1 or #icc4 7#c7 ,inflation adjustments 7,a7 ,monthly specified child allowance ,in the case of any month beginning after ,december #ca1 #bjbf1 the #cjj amount in paragraph 7#a77;,a7 shall be increased by an amount equal to-- 7i7 such dollar amount1 multiplied by-- 7ii7 the percentage 7if any7 by which-- 7,i7 the ,,cpi 7as defined in section #a7;f77#d77 for the calendar year preceding the calendar year in which such month begins1 exceeds 7,,ii7 the ,,cpi 7as so defined7 for calendar year #bjbe4 7,b7 ,initial threshold amount ,in the case of any taxable year beginning after ,december #ca1 #bjbe1 the dollar amounts in subclauses 7,i7 and 7,,iii7 of paragraph 7#b77;,d77i7 shall each be increased by an amount equal to-- 7i7 such dollar amount1 multiplied by 7ii7 the percentage 7if any7 which would be determined under subparagraph 7,a77ii7 if subclause 7,,ii7 thereof were applied by substituting #bjbb for #bjbd4 7,c7 ,rounding 7i7 ,monthly specified child allowance ,any increase under subparagraph 7,a7 which is not a multiple of #aj shall be rounded to the nearest multiple of #aj4 7ii7 ,initial threshold amount ,any increase under subparagraph 7,b7 which is not a multiple of #e1jjj shall be rounded to the nearest multiple of #e1jjj4 7c7 ,specified child ,for purposes of this section-- 7#a7 ,in general ,the term specified child means1 with respect to any taxpayer for any calendar month1 an individual-- 7,a7 who has the same principal place of abode as the taxpayer for more than one-half of such month1 7,b7 who is younger than the taxpayer and will not1 as of the close of such month1 have attained age #ah1 7,c7 who receives care from the taxpayer during such month that is not compensated1 7,d7 who is not the spouse of the taxpayer at any time during such month1 and 7,e7 who either-- 7i7 is a citizen1 national1 or resident of the ,united ,states1 or 7ii7 if the taxpayer is a citizen or national of the ,united ,states1 such individual is a legally adopted individual of such taxpayer or is lawfully placed with such taxpayer for legal adoption by such taxpayer4 7#b7 ,certain individuals ineligible ,in the case of an individual who is a specified child with respect to another taxpayer for any calendar month1 such individual shall be treated for such calendar month as having no specified children4 7#c7 ,care from the taxpayer 7,a7 ,in general ,except as otherwise provided by the ,secretary1 whether any individual receives care from the taxpayer 7within the meaning of paragraph 7#a77;,c77 shall be determined on the basis of facts and circumstances with respect to the following factors3 7i7 ,the supervision provided by the taxpayer regarding the daily activities and needs of the individual4 7ii7 ,the maintenance by the taxpayer of a secure environment at which the individual resides4 7iii7 ,the provision or arrangement by the taxpayer of1 and transportation by the taxpayer to1 medical care at regular intervals and as required for the individual4 7iv7 ,the involvement by the taxpayer in1 and financial and other support by the taxpayer for1 educational or similar activities of the individual4 7v7 ,any other factor that the ,secretary determines to be appropriate to determine whether the individual receives care from the taxpayer4 7,b7 ,determination of whether care is compensated ,for purposes of determining if care is compensated within the meaning of paragraph 7#a77;,c71 compensation from the ,federal ,government1 a ,state or local government1 a ,tribal government1 or any possession of the ,united ,states shall not be taken into account4 7#d7 ,application of tie-breaker rules 7,a7 ,in general ,except as provided in subparagraph 7,d71 if any individual would 7but for this paragraph7 be a specified child of #b or more taxpayers for any month1 such individual shall be treated as the specified child only of the taxpayer who is-- 7i7 the parent of the individual 7or1 if such individual would 7but for this paragraph7 be a specified child of #b or more parents of the individual for such month1 the parent of the individual determined under subparagraph 7,b771 7ii7 if the individual is not a specified child of any parent of the individual 7determined without regard to this paragraph71 the specified relative of the individual with the highest adjusted gross income for the taxable year which includes such month1 or 7iii7 if the individual is neither a specified child of any parent of the individual nor a specified child of any specified relative of the individual 7in both cases determined without regard to this paragraph71 the taxpayer with the highest adjusted gross income for the taxable year which includes such month4 7,b7 ,tie-breaker among parents ,if any individual would 7but for this paragraph7 be the specified child of #b or more parents of the individual for any month1 such child shall be treated only as the specified child of-- 7i7 the parent with whom the child resided for the longest period of time during such month1 or 7ii7 if the child resides with both parents for the same amount of time during such month1 the parent with the highest adjusted gross income for the taxable year which includes such month4 7,c7 ,specified relative ,for purposes of this paragraph1 the term specified relative means an individual who is-- 7i7 an ancestor of a parent of the specified child1 7ii7 a brother or sister of a parent of the specified child1 or 7iii7 a brother1 sister1 stepbrother1 or stepsister of the specified child4 7,d7 ,certain parents or specified relatives not taken into account ,this paragraph shall be applied without regard to any parent or specified relative of an individual for any month if-- 7i7 such parent or specified relative elects to have such individual not be treated as a specified child of such parent or specified relative for such month1 7ii7 in the case of a parent of such individual1 the adjusted gross income of the taxpayer 7with respect to whom such individual would be treated as a specified child after application of this subparagraph7 for the taxable year which includes such month is higher than the highest adjusted gross income of any parent of the individual for any taxable year which includes such month 7determined without regard to any parent with respect to whom such individual is not a specified child1 determined without regard to subparagraphs 7,a7 and 7,b7 and after application of this subparagraph71 and 7iii7 in the case of a specified relative of such individual1 the adjusted gross income of the taxpayer 7with respect to whom such individual would be treated as a specified child after application of this subparagraph7 for the taxable year which includes such month is higher than the highest adjusted gross income of any parent and any specified relative of the individual for any taxable year which includes such month 7determined without regard to any parent and any specified relative with respect to whom such individual is not a specified child1 determined without regard to subparagraphs 7,a7 and 7,b7 and after application of this subparagraph74 7,e7 ,treatment of joint returns ,for purposes of this paragraph1 with respect to any month1 the adjusted gross income of each person who files a joint return for the taxable year which includes such month is the total adjusted gross income shown on the joint return for the taxable year4 7,f7 ,parent ,except as otherwise provided by the ,secretary1 the term parent shall have the same meaning as when used in section #aeb7;c77#d74 7#e7 ,treatment of temporary absences ,except as provided in regulations or other guidance issued by the ,secretary1 for purposes of this subsection-- 7,a7 ,in general ,in the case of any individual's temporary absence from such individual's principal place of abode1 each day composing the temporary absence shall-- 7i7 be treated as a day at such individual's principal place of abode1 7ii7 be treated as satisfying the care requirement described in paragraph 7#a77;,c7 for each day described in clause 7i71 and 7iii7 not be treated as a day at any other location4 7,b7 ,temporary absence ,for purposes of subparagraph 7,a71 an absence shall be treated as temporary if-- 7i7 the individual would have resided at the place of abode but for the absence1 and 7ii7 under the facts and circumstances1 it is reasonable to assume that the individual will return to reside at the place of abode4 7#f7 ,special rule for divorced parents1 etc ,rules similar to the rules section #aeb7;e7 shall apply for purposes of this subsection4 7#g7 ,eligibility determined on basis of presumptive eligibility 7,a7 ,in general ,if a period of presumptive eligibility is established under section #gebg;,a7c7 with respect to any taxpayer and child-- 7i7 such child shall be treated as the specified child of such taxpayer for any month in such period of presumptive eligibility1 and 7ii7 such child shall not be treated as the specified child of any other taxpayer with respect to whom a period of presumptive eligibility has not been established for any such month4 7,b7 ,ability of credit claimants to establish presumptive eligibility ,nothing in section #gebg;,a7c7 shall be interpreted to preclude a taxpayer from establishing a period of presumptive eligibility 7including any period described in subparagraph 7,d7 with respect to which payment could be made7 with respect to any specified child for purposes of this section solely because such taxpayer affirmatively elects not to receive monthly advance child payments under section #gebg;,a4 7,c7 ,exception for income-based tie-breaker rules ,if a period of presumptive eligibility is established under section #gebg;,a7c7 for any individual with respect to any taxpayer and such individual is not the specified child of such taxpayer for any month in such period by reason of such taxpayer failing to be described in clause 7i71 7ii71 or 7iii7 of paragraph 7#d77;,a7 for the taxable year which includes such month1 subparagraph 7,a7 shall not apply with respect to such month4 7,d7 ,treatment of certain retroactive payments ,if any payment is made under subparagraph 7,a7 or 7,b7 of section #gebg;,a7f77#c7 or paragraph 7#a7 or 7#b7 of section #gebg;,a7g71 with respect to any taxpayer and child for any period1 such period shall be treated as a period of presumptive eligibility established under section #gebg;,a7c7 with respect to such taxpayer and child for purposes of applying subparagraph 7,a74 7,e7 ,fraud and intentional disregard of rules or regulations ,if the ,secretary determines that the taxpayer committed fraud or intentionally disregarded rules or regulations in establishing or maintaining any period of presumptive eligibility1 the months with respect to which such fraud or intentional disregard relates shall not be treated as a period of presumptive eligibility for purposes of subparagraph 7,a74 7d7 ,credit refundable ,if the taxpayer 7in the case of a joint return1 either spouse7 has a principal place of abode 7determined as provided in section #cb7 in the ,united ,states or ,puerto ,rico for more than one-half of any calendar month during the taxable year1 so much of the credit otherwise allowed under subsection 7a7 as is attributable to monthly specified child allowances with respect to any such calendar month shall be allowed under subpart ,c 7and not allowed under this subpart74 7e7 ,identification requirements 7#a7 ,qualifying child identification requirement ,no credit shall be allowed under this section to a taxpayer with respect to any qualifying child unless the taxpayer includes the name and taxpayer identification number of such qualifying child on the return of tax for the taxable year and such taxpayer identification number was issued on or before the due date for filing such return4 7#b7 ,taxpayer identification requirement ,no credit shall be allowed under this section if the taxpayer identification number of the taxpayer was issued after the due date for filing the return for the taxable year4 7f7 ,restrictions on taxpayers who improperly claimed credit or improperly received monthly advance child payment 7#a7 ,taxpayers making prior fraudulent or reckless claims 7,a7 ,in general ,no credit shall be allowed under this section for any taxable year 7and no payment shall be made under section #gebg;,a for any month7 in the disallowance period4 7,b7 ,disallowance period ,for purposes of subparagraph 7,a71 the disallowance period is-- 7i7 the period of #abj calendar months after the most recent calendar month for which there was a final determination that the taxpayer's claim of credit under this section or section #bd 7or payment received under section #gebg;,a7 was due to fraud1 and 7ii7 the period of #bd calendar months after the most recent calendar month for which there was a final determination that the taxpayer's claim of credit under this section or section #bd 7or payment received under section #gebg;,a7 was due to reckless or intentional disregard of rules and regulations 7but not due to fraud74 7#b7 ,taxpayers making improper prior claims ,in the case of a taxpayer who is denied credit under this section or section #bd for any taxable year as a result of the deficiency procedures under subchapter ,b of chapter #fc1 no credit shall be allowed under this section for any subsequent taxable year 7and no payment shall be made under section #gebg;,a for any subsequent month7 unless the taxpayer provides such information as the ,secretary may require to demonstrate eligibility for such credit4 7#c7 ,coordination with possessions of the ,united ,states ,for purposes of this subsection1 a taxpayer's claim of credit under this section or section #bd 7or payment received under section #gebg;,a7 includes a claim of credit under this section or section #bd of the income tax law of any jurisdiction other than the ,united ,states 7or similar payment received under section #gebg;,a of such income tax law71 and a claim made or a payment received from ,american ,samoa pursuant to a plan described in subsection 7h77#c77;,b7 or section #bd7k77#c77;,b74 7g7 ,reconciliation of credit and monthly advance child payments 7#a7 ,in general ,the amount otherwise determined under subsection 7a7 with respect to any taxpayer for any taxable year shall be reduced 7but not below zero7 by the aggregate amount of payments made under section #gebg;,a to such taxpayer for one or more calendar months in such taxable year4 ,any failure to so reduce the credit shall be treated as arising out of a mathematical or clerical error and assessed according to section #fbac7;b77#a74 7#b7 ,increase in tax equal to excess advance payments in certain circumstances ,if the aggregate amount of payments made to the taxpayer under section #gebg;,a for one or more calendar months in such taxable year exceeds the amount allowed as a credit under subpart ,c by reason of this section with respect to such taxpayer for such taxable year 7without regard to paragraph 7#a7 of this subsection71 the tax imposed by this chapter for such taxable year shall be increased by so much of such excess as is attributable to one or more of the following3 7,a7 ,fraud1 or reckless or intentional disregard of rules and regulations1 by the taxpayer4 7,b7 ,changes in the taxpayer's modified adjusted gross income or filing status that affect the application of the limitation imposed by subsection 7b77#b74 7,c7 ,payments under section #gebg;,a which were made for months which were not part of a period of presumptive eligibility4 7,d7 ,a failure to be the taxpayer described in clause 7i71 7ii71 or 7iii7 of subsection 7c77#d77;,a74 7,e7 ,a failure to satisfy the requirements of subsection 7d74 7,f7 ,a failure to satisfy the requirements of paragraphs 7#a7 or 7#b7 of subsection 7e71 except that a failure to satisfy the requirements of subsection 7e77#a7 shall not be taken into account under this subparagraph if the taxpayer demonstrates to the satisfaction of the ,secretary that it is reasonable to expect that the qualifying child will be issued a taxpayer identification number and that the delay in such issuance was due to reasonable cause and not willful neglect4 7,g7 ,such other circumstances as the ,secretary identifies for purposes of this subparagraph to facilitate the administration and enforcement by the ,secretary of section #gebg;,a1 to minimize the amount of advance payments made under section #gebg;,a to ineligible individuals1 and to prevent abuse4 7,h7 ,payments subject to treatment as excess advance payments after notice under section #gebg;,a7j77#b74 7#c7 ,joint returns ,except as otherwise provided by the ,secretary1 in the case of an advance payment made under section #gebg;,a with respect to a joint return1 half of such payment shall be treated as having been made to each individual filing such return4 7#d7 ,coordination with possessions of the ,united ,states ,for purposes of this subsection1 payments made under section #gebg;,a include payments made by any jurisdiction other than the ,united ,states under section #gebg;,a of the income tax law of such jurisdiction1 and advance payments made by ,american ,samoa pursuant to a plan described in subsection 7h77#c77;,b74 ,any increase in tax imposed on a taxpayer by reason of paragraph 7#b7 of the income tax law of a jurisdiction other than the ,united ,states shall be considered to reduce the aggregate amount of payments made to such taxpayer by such jurisdiction4 ,in carrying out this section1 the ,secretary shall coordinate with each possession of the ,united ,states to prevent any application of this paragraph that is inconsistent with the purposes of this subsection4 7h7 ,application of credit in possessions 7#a7 ,mirror code possessions 7,a7 ,in general ,the ,secretary shall pay to each possession of the ,united ,states with a mirror code tax system amounts equal to the loss 7if any7 to that possession by reason of the application of this section 7determined without regard to this subsection7 with respect to taxable years beginning in calendar years after #bjbe4 ,such amounts shall be determined by the ,secretary based on information provided by the government of the respective possession4 7,b7 ,coordination with credit allowed against ,united ,states income taxes ,no credit shall be allowed under this section for any taxable year to any individual to whom a credit is allowable against taxes imposed by a possession of the ,united ,states with a mirror code tax system by reason of the application of this section in such possession for such taxable year4 7,c7 ,mirror code tax system ,for purposes of this paragraph1 the term mirror code tax system means1 with respect to any possession of the ,united ,states1 the income tax system of such possession if the income tax liability of the residents of such possession under such system is determined by reference to the income tax laws of the ,united ,states as if such possession were the ,united ,states4 7#b7 ,cross references related to application of credit to residents of ,puerto ,rico 7,a7 ,for application of refundable credit to residents of ,puerto ,rico1 see subsection 7d74 7,b7 ,for application of advance payment to residents of ,puerto ,rico1 see section #gebg;,a7b77#e74 7#c7 ,american ,samoa 7,a7 ,in general ,the ,secretary shall pay to ,american ,samoa amounts estimated by the ,secretary as being equal to the aggregate benefits that would have been provided to residents of ,american ,samoa by reason of the application of this section for taxable years beginning in calendar years after #bjbe if the provisions of this section had been in effect in ,american ,samoa 7applied as if ,american ,samoa were the ,united ,states and without regard to the application of this section to residents of ,puerto ,rico under subsection 7d774 7,b7 ,distribution requirement ,subparagraph 7,a7 shall not apply unless ,american ,samoa has a plan1 which has been approved by the ,secretary1 under which ,american ,samoa will promptly distribute such payments to its residents4 7,c7 ,coordination with credit allowed against ,united ,states income taxes 7i7 ,in general ,in the case of a taxable year with respect to which a plan is approved under subparagraph 7,b71 this section 7other than this subsection7 shall not apply to any individual eligible for a distribution under such plan4 7ii7 ,application of section in event of absence of approved plan ,in the case of a taxable year with respect to which a plan is not approved under subparagraph 7,b71 subsection 7d7 shall be applied by substituting 1 ,puerto ,rico1 or ,american ,samoa for or ,puerto ,rico4 7#d7 ,treatment of payments ,for purposes of section #acbd of title #ca1 ,united ,states ,code1 the payments under this subsection shall be treated in the same manner as a refund due from a credit provision referred to in subsection 7b77#b7 of such section4 7i7 ,regulations ,the ,secretary shall issue such regulations or other guidance as the ,secretary determines necessary or appropriate to carry out the purposes of this section1 including regulations or other guidance-- 7#a7 for determining whether an individual receives care from a taxpayer for purposes of subsection 7c77#a77;,c71 and 7#b7 to coordinate or modify the application of this section1 section #bd1 and section #gebg;,a in the case of any taxpayer-- 7,a7 whose taxable year is other than a calendar year1 7,b7 whose filing status for a taxable year is different from the status used for determining one or more monthly payments under section #gebg;,a during such taxable year1 or 7,c7 whose principal place of abode for any month is different from the principal place of abode used for determining the monthly payment under section #gebg;,a for such month4 #bd;,b4 ,credit for certain other dependents 7a7 ,in general ,there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to #ejj with respect to each specified dependent of such taxpayer for such taxable year4 7b7 ,limitation based on modified adjusted gross income 7#a7 ,in general ,the amount of the credit allowable under subsection 7a7 shall be reduced 7but not below zero7 by #ej for each #a1jjj 7or fraction thereof7 by which the taxpayer's modified adjusted gross income exceeds the threshold amount4 7#b7 ,threshold amount ,for purposes of this subsection1 the term threshold amount means-- 7,a7 #djj1jjj1 in the case of a joint return or surviving spouse 7as defined in section #b7;a771 7,b7 #bjj1jjj1 in the case of a married individual filing a separate return1 and 7,c7 #cjj1jjj1 in any other case4 7#c7 ,modified adjusted gross income ,for purposes of this subsection1 the term modified adjusted gross income means adjusted gross income increased by any amount excluded from gross income under section #iaa1 #ica1 or #icc4 7c7 ,specified dependent ,for purposes of this section1 the term specified dependent means1 with respect to any taxpayer for any taxable year1 any dependent of such taxpayer 7as defined in section #aeb7 for such taxable year unless such dependent-- 7#a7 is a specified child of the taxpayer1 or any other taxpayer1 for any month during such taxable year1 or 7#b7 would not be a dependent if subparagraph 7,a7 of section #aeb7;b77#c7 were applied without regard to all that follows resident of the ,united ,states4 7d7 ,special rule for taxable year child attains age #ah ,if any dependent of the taxpayer attains age #ah during the taxable year-- 7#a7 whether such dependent is a specified dependent shall be determined without regard to paragraph 7#a7 of subsection 7c71 and 7#b7 with respect to such dependent1 subsection 7a7 shall be applied by substituting an amount for #ejj that bears the same ratio to #ejj as-- 7,a7 the excess of-- 7i7 #ab1 over 7ii7 the number of months during such taxable year with respect to which such dependent is a specified child of the taxpayer or any other taxpayer1 bears to 7,b7 #ab4 7e7 ,identification requirements ,rules similar to the rules of section #bd;,a7e7 shall apply for purposes of this section4 7f7 ,taxable year must be full taxable year ,except in the case of a taxable year closed by reason of the death of the taxpayer1 no credit shall be allowable under this section in the case of a taxable year covering a period of less than #ab months4 7g7 ,regulations ,the ,secretary shall issue such regulations or other guidance as the ,secretary determines necessary or appropriate to carry out the purposes of this section4 4 7b7 ,monthly payment of child tax credit ,section #gebg;,a is amended to read as follows3 #gebg;,a4 ,monthly payments of child tax credit 7a7 ,in general ,the ,secretary shall pay to each taxpayer1 during each calendar month which is during a period of presumptive eligibility with respect to the taxpayer and any child1 an amount equal to the monthly advance child payment determined with respect to such taxpayer for such month4 7b7 ,monthly advance child payment ,the term monthly advance child payment means1 with respect to any taxpayer for any calendar month1 the amount 7if any7 which is estimated by the ,secretary as being equal to the monthly specified child allowance which would be determined under section #bd;,a7b7 with respect to such taxpayer for such calendar month if-- 7#a7 the only specified children of such taxpayer for such calendar month are the specified children of such taxpayer for the reference month 7determined without regard to section #bd;,a7c77#g771 7#b7 the ages of such children 7and the status of such children as specified children7 are determined for such calendar month by taking into account the passage of time since such reference month1 7#c7 each child is only taken into account as a specified child for such calendar month if such calendar month is during a period of presumptive eligibility with respect to the taxpayer and such child1 7#d7 the limitations of section #bd;,a7b77#b7 were applied with respect to the reference taxable year rather than with respect to the applicable taxable year1 and 7#e7 no monthly specified child allowance were determined with respect to such taxpayer for such calendar month unless the taxpayer 7in the case of a joint return1 either spouse7 has a principal place of abode 7determined as provided in section #cb7 in the ,united ,states or ,puerto ,rico for more than one-half of the reference month4 7c7 ,period of presumptive eligibility 7#a7 ,in general ,for purposes of this section1 the term period of presumptive eligibility means1 with respect to any taxpayer and any child1 the period-- 7,a7 beginning with the calendar month following the calendar month during which the taxpayer provides the ,secretary with sufficient information for the ,secretary to-- 7i7 determine that such child was a specified child of the taxpayer for the reference month 7determined without regard to section #bd;,a7c77#g771 and 7ii7 estimate the monthly advance child payment for such calendar month1 and 7,b7 ending with the earliest of-- 7i7 the month beginning immediately after the month on which the ,secretary sends the taxpayer a written notice that the taxpayer's period of presumptive eligibility with respect to such child is being terminated by reason of information known to the ,secretary 7including a failure to provide annual information under paragraph 7#b77 which casts doubt on such taxpayer's status as being allowed the monthly specified child allowance under section #bd;,a for such child 7determined without regard to section #bd;,a7c77#g77 with respect to one or more months following the reference month1 7ii7 any month with respect to which the taxpayer notifies the ,secretary that such taxpayer is not allowed a monthly specified child allowance for such month under section #bd;,a7b7 7determined without regard to section #bd;,a7c77#g771 and 7iii7 the month beginning immediately before the first month of a new period of presumptive eligibility with respect to such taxpayer and such child which is established on the basis of a reference month more recent than the reference month with respect to which such prior period was established 7including on the basis of an annual renewal described in paragraph 7#b774 7#b7 ,annual renewal ,the ,secretary shall terminate a taxpayer's period of presumptive eligibility with respect to any child under paragraph 7#a77;,b77i7 unless such taxpayer provides information sufficient to establish a new period of presumptive eligibility with respect to such child 7as described in paragraph 7#a77;,b77ii77 on an annual basis4 7#c7 ,automatic eligibility for birth of child ,the ,secretary shall issue regulations or other guidance to establish procedures pursuant to which1 to the maximum extent administratively practicable-- 7,a7 a parent of a child born during a calendar month shall be treated as automatically establishing a period of presumptive eligibility with respect to such child1 7,b7 the month for which such period begins1 and the month by which the first annual renewal described in paragraph 7#b7 must be completed1 are determined1 and 7,c7 if the first monthly advance child payment with respect to such child is made after the calendar month in which such child is born1 such payment is increased to properly take into account the months in such period of presumptive eligibility which precede the month in which such payment is made4 7#d7 ,presumptive eligibility based on certain government programs ,the ,secretary shall issue regulations or other guidance to establish procedures under which-- 7,a7 based on information provided to the ,secretary by one or more government entities1 a parent or specified relative of a child is treated as automatically establishing a period of presumptive eligibility with respect to such child1 and 7,b7 the month for which such period begins1 the month by which the first annual renewal described in paragraph 7#b7 must be completed1 and any additional circumstances under which such period will terminate1 are determined4 7#e7 ,taxpayer responsibility to notify ,secretary ,in the event that any taxpayer is not allowed a monthly specified child allowance under section #bd;,a7b7 7determined without regard to section #bd;,a7c77#g77 for any month in a period of presumptive eligibility with respect to such taxpayer1 such taxpayer shall notify the ,secretary under paragraph 7#a77;,b77ii7 at such time and in such manner as the ,secretary may provide4 7#f7 ,transition rule ,with respect periods of presumptive eligibility beginning during the first #f months to which this section applies1 the ,secretary shall issue regulations or other guidance to establish procedures pursuant to which-- 7,a7 based on information known to the ,secretary including returns of tax for either of the last #b taxable years ending before such month1 a parent or specified relative of a child is treated as automatically establishing a period of presumptive eligibility with respect to such child1 and 7,b7 the month for which such period begins1 the month by which the first annual renewal described in paragraph 7#b7 must be completed1 and any additional circumstances under which such period will terminate1 are determined4 7d7 ,determination of reference month and reference taxable year ,for purposes of this section-- 7#a7 ,reference month ,the term reference month means1 with respect to any calendar month in a period of presumptive eligibility with respect to a taxpayer1 the most recent of-- 7,a7 in the case of a taxpayer who filed a return of tax for the last taxable year ending before such calendar month1 the last month of such taxable year1 7,b7 in the case of a taxpayer who filed a return of tax for the taxable year preceding the taxable year described in subparagraph 7,a71 the last month of such preceding taxable year1 and 7,c7 in the case of a taxpayer who otherwise provides the information referred to in subsection 7c77#a77;,a71 the month with respect to which such information is provided4 7#b7 ,reference taxable year ,the term reference taxable year means1 with respect to any calendar month in a period of presumptive eligibility with respect to a taxpayer-- 7,a7 if the reference month with respect to such calendar month is determined under subparagraph 7,a7 or 7,b7 of paragraph 7#a71 the taxable year referred to in such subparagraph1 respectively1 and 7,b7 if the reference month with respect to such calendar month is determined under subparagraph 7#a77;,c71 the last taxable year ending before such reference month4 7e7 ,methods of providing information ,to establish a period of presumptive eligibility 7#a7 ,in general ,the ,secretary shall ensure the information described in subsection 7c77#a77;,a7 may be provided on the return of tax for the taxable year ending before the calendar year which includes the month for which such period would begin1 through the on-line portal described in paragraph 7#b71 or in such other manner as the ,secretary may provide4 7#b7 ,on-line information portal ,the ,secretary shall establish an on-line portal 7available in multiple languages7 which allows taxpayers to-- 7,a7 subject to such restrictions as the ,secretary may provide1 elect to begin or cease receiving payments under this section1 and 7,b7 provide the information described in subsection 7c77#a77;,a74 7f7 ,resolution of competing claims of presumptive eligibility with respect to same child 7#a7 ,in general ,if there is a period of presumptive eligibility with respect to any taxpayer and child 7hereafter referred to as the original claim71 a period of presumptive eligibility would 7without regard to this subsection7 be established with respect another taxpayer and such child 7hereafter referred to as the challenge claim71 and the period of such challenge claim would overlap with the period of such original claim-- 7,a7 such challenge claim shall not be taken into account under this section unless the reference month with respect to which the challenge claim would be established is at least as recent as the reference month with respect to which the original claim is established1 7,b7 such challenge claim shall not begin before the original claim is terminated1 and 7,c7 the ,secretary shall establish procedures under which the ,secretary expeditiously adjudicates such claims on the basis of the most recent feasible reference month4 7#b7 ,provisions related to adjudication 7,a7 ,challenge claim must relate to at least #c months prospectively ,the procedures established under paragraph 7#a77;,c7 shall require that the taxpayer establishing the challenge claim express a reasonable expectation and intent that such taxpayer would be allowed a monthly specified child allowance under section #bd;,a7b7 7determined without regard to section #bd;,a7c77#g77 for at least the first #b months following the reference month referred to in paragraph 7#a77;,c74 7,b7 ,expedited process2 appeals ,the procedures established under paragraph 7#a77;,c7 shall include-- 7i7 an expedited process for taxpayers who meet such requirements as the ,secretary may establish for such expedited process1 and 7ii7 procedures for adjudicating an appeal of an adverse decision4 7,c7 ,information receipt and coordination ,for purposes of obtaining information relevant to any adjudication under this paragraph1 the ,secretary may enter into agreements to receive information from1 and otherwise coordinate with-- 7i7 ,federal agencies 7including the ,social ,security ,administration and the ,department of ,agriculture71 7ii7 any ,state1 local government1 ,tribal government1 or possession of the ,united ,states1 and 7iii7 any other individual or entity that the ,secretary determines to be appropriate for such purposes4 7,d7 ,adjudication not treated as assessment ,any adjudication under this paragraph shall not be treated as an assessment described in section #fbja4 7,e7 ,adjudication not treated as inspection of taxpayer's books of account ,the inspection of a taxpayer's books of account in connection with any adjudication under this paragraph shall not be treated as an examination or inspection of a taxpayer's books of account for purposes of section #gfje7;b74 7#c7 ,retroactive payments related to adjudication 7,a7 ,delay in establishment of challenge claim ,if the challenge claim is established pursuant to the procedures established under paragraph 7#a77;,c71 the ,secretary shall make a one-time payment to the taxpayer with respect to such claim equal to the aggregate amount of increases in the monthly advance child payments which would have been made to such taxpayer if such challenge claim had been allowed to take effect without regard to this subsection4 ,any payment under this subparagraph shall be in addition to any payment made under subsection 7g74 7,b7 ,termination and reinstatement of original claim ,if1 pursuant to the procedures established under paragraph 7#a77;,c71 the original claim is terminated under subsection 7c77#a77;,b77i7 and a new period of presumptive eligibility is subsequently established pursuant to such procedures with respect the same taxpayer and child as for such original claim1 the ,secretary shall make a one-time payment to the taxpayer with respect to such claim equal to the aggregate amount of increases in the monthly advance child payments which would have been made to such taxpayer if such original claim had never been terminated4 7g7 ,rules related to grace periods and hardships 7#a7 ,automatic grace period 7,a7 ,in general ,if a taxpayer establishes a period of presumptive eligibility with respect to any child1 elects the application of this paragraph1 and demonstrates to the satisfaction of the ,secretary that such taxpayer would be allowed a monthly specified child allowance under section #bd;,a7b7 7determined without regard to section #bd;,a7c77#g77 for one or more of the #c months immediately preceding the first month of such period1 the ,secretary shall make a one-time payment to the taxpayer equal to the aggregate amount of increases in the monthly advance child payments which would have been made to such taxpayer if such months were part of such period4 ,the preceding sentence shall not apply to the extent that the ,secretary determines that the failure to establish the period of presumptive eligibility with respect to such child for any such month was due to fraud or reckless or intentional disregard of rules and regulations4 7,b7 ,limitation ,subparagraph 7,a7 shall not apply with respect to any taxpayer more than once during any #cf-month period4 7#b7 ,hardship ,if a taxpayer establishes a period of presumptive eligibility with respect to any child1 elects the application of this paragraph 7and does not elect the application of paragraph 7#a7 with respect to the establishment of such period71 demonstrates to the satisfaction of the ,secretary that such taxpayer would be allowed a monthly specified child allowance under section #bd;,a7b7 7determined without regard to section #bd;,a7c77#g77 for one or more of the #f months immediately preceding the first month of such period1 and the ,secretary determines that the failure to establish the period of presumptive eligibility with respect to such child for such months was due to domestic violence1 serious illness1 natural disaster1 or any other hardship1 the ,secretary shall make a one-time payment to the taxpayer equal to the aggregate amount of increases in the monthly advance child payments which would have been made to such taxpayer if such months were part of such period4 7#c7 ,coordination with retroactive payment for delay in establishment of challenge claim ,for purposes of applying paragraph 7#a7 or 7#b7 with respect to any challenge claim to which subsection 7f77#c77;,a7 applies1 the period of presumptive eligibility shall be treated as including the period for which payment is made under such subsection4 7h7 ,provisions related to form1 manner1 and treatment of payments 7#a7 ,application of electronic funds payment requirement ,the payments made by the ,secretary under subsection 7a7 shall be made by electronic funds transfer to the same extent and in the same manner as if such payments were ,federal payments not made under this title4 7#b7 ,delivery of payments ,notwithstanding any other provision of law1 the ,secretary may certify and disburse refunds payable under this section electronically to-- 7,a7 any account to which the payee authorized1 on or after ,january #a1 #bjbd1 the delivery of a refund of taxes under this title or of a ,federal payment 7as defined in section #cccb of title #ca1 ,united ,states ,code71 7,b7 any account belonging to a payee from which that individual1 on or after ,january #a1 #bjbd1 made a payment of taxes under this title1 or 7,c7 any ,treasury-sponsored account 7as defined in section #bjh4b of title #ca1 ,code of ,federal ,regulations74 7#c7 ,waiver of certain rules ,notwithstanding section #ccbe of title #ca1 ,united ,states ,code1 or any other provision of law1 with respect to any payment of a refund under this section1 a disbursing official in the executive branch of the ,united ,states ,government may modify payment information received from an officer or employee described in section #ccbe7;a77#a77;,b7 of such title for the purpose of facilitating the accurate and efficient delivery of such payment4 ,except in cases of fraud or reckless neglect1 no liability under sections #ccbe1 #cebg1 #cebh1 or #cebi of title #ca1 ,united ,states ,code1 shall be imposed with respect to payments made under this paragraph4 7#d7 ,exception from reduction or offset ,any applicable payment 7as defined in paragraph 7#e77;,e77iii77 shall not be-- 7,a7 subject to reduction or offset pursuant to section #cgaf or #cgbj;,a of title #ca1 ,united ,states ,code1 7,b7 subject to reduction or offset pursuant to subsection 7c71 7d71 7e71 or 7f7 of section #fdjb1 or 7,c7 reduced or offset by other assessed ,federal taxes that would otherwise be subject to levy or collection4 7#e7 ,assignment of benefits 7,a7 ,in general ,the right of any person to any applicable payment shall not be transferable or assignable1 at law or in equity1 and no applicable payment shall be subject to1 execution1 levy1 attachment1 garnishment1 or other legal process1 or the operation of any bankruptcy or insolvency law4 7,b7 ,encoding of payments ,in the case of an applicable payment described in subparagraph 7,e77iii77,i7 that is paid electronically by direct deposit through the ,automated ,clearing ,house 7,,ach7 network1 the ,secretary of the ,treasury 7or the ,secretary's delegate7 shall-- 7i7 issue the payment using a unique identifier that is reasonably sufficient to allow a financial institution to identify the payment as an applicable payment1 and 7ii7 further encode the payment pursuant to the same specifications as required for a benefit payment defined in section #bab4c of title #ca1 ,code of ,federal ,regulations4 7,c7 ,garnishment 7i7 ,encoded payments ,in the case of a garnishment order that applies to an account that has received an applicable payment that is encoded as provided in subparagraph 7,b71 a financial institution shall follow the requirements and procedures set forth in part #bab of title #ca1 ,code of ,federal ,regulations1 except-- 7,i7 notwithstanding section #bab4d of title #ca1 ,code of ,federal ,regulations 7and except as provided in subclause 7,,ii771 a financial institution shall not fail to follow the procedures of sections #bab4e and #bab4f of such title with respect to a garnishment order merely because such order has attached1 or includes1 a notice of right to garnish ,federal benefits issued by a ,state child support enforcement agency1 and 7,,ii7 a financial institution shall not1 with regard to any applicable payment1 be required to provide the notice referenced in sections #bab4f and #bab4g of title #ca1 ,code of ,federal ,regulations4 7ii7 ,other payments ,in the case of a garnishment order 7other than an order that has been served by the ,united ,states7 that has been received by a financial institution and that applies to an account into which an applicable payment that has not been encoded as provided in subparagraph 7,b7 has been deposited electronically on any date during the lookback period or into which an applicable payment that has been deposited by check on any date in the lookback period1 the financial institution1 upon the request of the account holder1 shall treat the amount of the funds in the account at the time of the request1 up to the amount of the applicable payment 7in addition to any amounts otherwise protected under part #bab of title #ca1 ,code of ,federal ,regulations71 as exempt from a garnishment order without requiring the consent of the party serving the garnishment order or the judgment creditor4 7iii7 ,liability ,a financial institution that acts in good faith in reliance on clauses 7i7 or 7ii7 shall not be subject to liability or regulatory action under any ,federal or ,state law1 regulation1 court or other order1 or regulatory interpretation for actions concerning any applicable payments4 7,d7 ,no reclamation rights ,this paragraph shall not alter the status of applicable payments as tax refunds or other nonbenefit payments for purpose of any reclamation rights of the ,department of the ,treasury or the ,internal ,revenue ,service as per part #baj of title #ca1 ,code of ,federal ,regulations4 7,e7 ,definitions ,for purposes of this paragraph-- 7i7 ,account holder ,the term account holder means a natural person whose name appears in a financial institution's records as the direct or beneficial owner of an account4 7ii7 ,account review ,the term account review means the process of examining deposits in an account to determine if an applicable payment has been deposited into the account during the lookback period4 ,the financial institution shall perform the account review following the procedures outlined in section #bab4e of title #ca1 ,code of ,federal ,regulations and in accordance with the requirements of section #bab4f of title #ca1 ,code of ,federal ,regulations4 7iii7 ,applicable payment ,the term applicable payment means-- 7,i7 any payment made to an individual under this section 7other than any payment made pursuant to paragraph 7#f771 7,,ii7 any advance payment made by a possession of the ,united ,states with a mirror code tax system 7as defined in section #bd7;h77 pursuant to an election under paragraph 7#f77;,b7 which corresponds to a payment described in subclause 7,i71 and 7,,iii7 any advance payment made by ,american ,samoa pursuant to a program for making such payments which is described in paragraph 7#f77;,c77ii74 7iv7 ,garnishment ,the term garnishment means execution1 levy1 attachment1 garnishment1 or other legal process4 7v7 ,garnishment order ,the term garnishment order means a writ1 order1 notice1 summons1 judgment1 levy1 or similar written instruction issued by a court1 a ,state or ,state agency1 a municipality or municipal corporation1 or a ,state child support enforcement agency1 including a lien arising by operation of law for overdue child support or an order to freeze the assets in an account1 to effect a garnishment against a debtor4 7vi7 ,lookback period ,the term lookback period means the two-month period that begins on the date preceding the date of account review and ends on the corresponding date of the month two months earlier1 or on the last date of the month two months earlier if the corresponding date does not exist4 7#f7 ,application of advance payments in the possessions of the united states 7,a7 ,puerto ,rico 7i7 ,for application of child tax credit to residents of ,puerto ,rico1 see section #bd;,a7d74 7ii7 ,for application of monthly advance child payments to residents of ,puerto ,rico1 see subsection 7b77#d74 7,b7 ,mirror code possessions ,in the case of any possession of the ,united ,states with a mirror code tax system 7as defined in section #bd;,a7h77#a77;,c771 this section shall not be treated as part of the income tax laws of the ,united ,states for purposes of determining the income tax law of such possession unless such possession elects to have this section be so treated4 7,c7 ,administrative expenses of advance payments 7i7 ,mirror code possessions ,in the case of any possession described in subparagraph 7,b7 which makes the election described in such subparagraph1 the amount otherwise paid by the ,secretary to such possession under section #bd;,a7h77#a77;,a7 with respect to taxable years beginning in #bjbe1 #bjbf1 and #bjbg shall each be increased by #cjj1jjj if such possession has a plan1 which has been approved by the ,secretary1 for making monthly advance child payments consistent with such election4 7ii7 ,american ,samoa ,the amount otherwise paid by the ,secretary to ,american ,samoa under subparagraph 7,a7 of section #bd;,a7h77#c7 with respect to taxable years beginning in #bjbd1 #bjbe1 and #bjbf shall each be increased by #cjj1jjj if the plan described in subparagraph 7,b7 of such section includes a program1 which has been approved by the ,secretary1 for making monthly advance child payments under rules similar to the rules of this section4 7iii7 ,timing of payment ,the ,secretary may pay1 upon the request of the possession of the ,united ,states to which the payment is to be made1 the amount of the increase determined under clause 7i7 or 7ii71 respectively1 immediately upon approval of the plan with respect to which such payment relates4 7i7 ,application of certain definitions and rules applicable to child tax credit 7#a7 ,definitions ,except as otherwise provided in this section1 terms used in this section which are also used in section #bd;,a shall have the same respective meanings as when used in section #bd;,a4 7#b7 ,treatment of certain deaths ,a child shall not be taken into account in determining the monthly advance child payment for any calendar month if the death of such child before the end of such month is known to the ,secretary as of date on which the ,secretary estimates such payment4 7#c7 ,identification requirements ,rules similar to the rules which apply under section #bd;,a7e7 shall apply for purposes of this section except that such rules shall apply with respect to the return of tax for the reference taxable year or1 in the case of information provided through the on-line portal or otherwise1 with respect to the information so provided4 7#d7 ,restrictions on taxpayers who improperly claimed credit or received monthly advance child payments ,for restrictions on taxpayers who improperly claimed credit or received monthly advance child payments1 see section #bd;,a7f74 7j7 ,notice of payments 7#a7 ,in general ,not later than ,january #ca of the calendar year following any calendar year during which the ,secretary makes one or more payments to any taxpayer under this section1 the ,secretary shall provide such taxpayer with a written notice which includes-- 7,a7 the taxpayer's taxpayer identity 7as defined in section #fajc7;b77#f771 7,b7 the aggregate amount of such payments made to such taxpayer during such calendar year1 and 7,c7 such other information as the ,secretary determines appropriate4 7#b7 ,certain payments subject to treatment as excess advance payments ,in the case of any payments made to a taxpayer which the ,secretary has determined are subject to treatment as excess advance payments1 the notice provided under paragraph 7#a7 to such taxpayer shall include the amount of such payments4 7k7 ,notification of certain events ,with respect to any taxpayer receiving monthly advance child payments under this section with respect to any specified child1 the ,secretary shall1 to the maximum extent practicable1 provide reasonable advance notice of each of the following3 7#a7 ,any month with respect to which such monthly advance child payment will increase 7relative to the preceding month7 by reason of an inflation adjustment under section #bd;,a7b77#c77;,a74 7#b7 ,any month with respect to which such monthly advance child payment will be reduced 7relative to the preceding month7 by reason of such child ceasing to be a specified child by reason of attaining age #ah4 7#c7 ,in the case of a taxpayer with a specified child described in section #bd;,a7b77#a77;,a71 any month with respect to which such monthly advance child payment will be reduced by reason of such child attaining age #f4 7#d7 ,such other events as the ,secretary determines appropriate4 7l7 ,regulations ,the ,secretary shall issue such regulations or other guidance as the ,secretary determines necessary or appropriate to carry out the purposes of this section4 4 7c7 ,termination of annual child tax credit ,section #bd is amended by adding at the end the following new subsection3 7l7 ,termination ,this section shall not apply to 7and no payment shall be made under subsection 7k7 with respect to7 any taxable year beginning after ,december #ca1 #bjbe4 4 7d7 ,disclosure of information relating to advance payment of child tax credit ,section #fajc7;e7 is amended by adding at the end the following new paragraph3 7#ab7 ,disclosure of information relating to advance payment of child tax credit 7,a7 ,joint filers ,in the case of any individual who is eligible for monthly advance child payments under section #gebg;,a1 if the reference taxable year 7as defined in section #gebg;,a7d77#b77 that the ,secretary uses to calculate such payments is a year for which the individual filed an income tax return jointly with another individual1 the ,secretary may disclose to such individual any information which is relevant in determining the monthly advance child payment under section #gebg;,a1 and the individual's eligibility for such payment1 including information regarding any of the following3 7i7 ,the number of specified children1 including by reason of the birth of a child4 7ii7 ,the name and ,,tin of specified children4 7iii7 ,marital status4 7iv7 ,modified adjusted gross income4 7v7 ,principal place of abode4 7vi7 ,such other information as the ,secretary may provide4 7,b7 ,competing claimants ,in the case of any adjudication under section #gebg;,a7f71 the ,secretary may disclose return information provided by the individual with the original claim to the individual with the challenge claim1 return information provided by the individual with the challenge claim to the individual with the original claim1 and any other information considered by the ,secretary in such adjudication to either or both such individuals4 ,such information shall be limited to the items specified in subparagraph 7,a7 and the following3 7i7 ,information received under any agreements or coordination the ,secretary entered into with-- 7,i7 any ,state1 local government1 ,tribal government1 or possession of the ,united ,states1 or 7,,ii7 any other individual or entity that the ,secretary determines to be appropriate for purposes of adjudicating claims under section #gebg;,a7f74 7ii7 ,information considered by the ,secretary about where and with whom the specified child resided4 7iii7 ,information considered by the ,secretary about expenditures made by the claimants to the extent such payments relate to the original or challenge claim4 4 7e7 ,conforming amendments 7#a7 ,section #bf7;b77#b7 is amended by striking and at the end of subparagraph 7,y71 by striking the period at the end of subparagraph 7,z7 and inserting 1 and1 and by adding at the end the following new subparagraph3 7,,aa7 section #bd;,a7g77#b7 7relating to increase in tax equal to excess advance payments in certain circumstances74 4 7#b7 ,section #aeb7;f77#f77;,b77ii7 is amended to read as follows3 7ii7 the credits under sections #bd1 #bd;,a1 and #bd;,b and the payments under sections #gebg;,a1 4 7#c7 ,section #cdjb7;f77#a77;,c7 is amended by inserting or section #bd;,a 7determined after application of subsection 7g7 thereof7 after section #bd 7determined after application of subsection 7j7 thereof74 7#d7 ,section #fajc7l77#ac77;,a77v7 is amended by inserting or section #bd;,a1 as the case may be after section #bd4 7#e7 ,section #fbaa7;b77#d77;,a7 is amended by inserting #bd;,a by reason of subsection 7d7 thereof1 after #bd by reason of subsections 7d7 and 7i77#a7 thereof14 7#f7 ,section #fbac7;g77#b77;,i7 is amended by inserting or section #bd;,a7e7 7relating to monthly child tax credit7 after section #bd7;e7 7relating to child tax credit74 7#g7 ,section #fbac7;g77#b77,l7 is amended by inserting #bd;,a1 after #bd14 7#h7 ,section #fbac7;g77#b77,p7 is amended-- 7,a7 by inserting or #bd;,a7f77#b7 after section #bd7;g77#b71 7,b7 by inserting or #bd;,a after under section #bd1 and 7,c7 by striking subsection 7g77#a7 thereof and inserting section #bd7;g77#a7 or section #bd;,a7f77#a71 respectively4 7#i7 ,section #ffie7;g77#b7 is amended by inserting #bd;,a1 after #bd14 7#aj7 ,paragraph 7#b7 of section #acbd7;b7 of title #ca1 ,united ,states ,code1 is amended by inserting #bd;,a1 after #bd14 7#aa7 ,the table of sections for subpart ,a of part ,,iv of subchapter ,a of chapter #a is amended by inserting after the item relating to section #bd the following new items3 ,sec4 #bd;,a4 ,monthly child tax credit4,sec4 #bd;,b4 ,credit for certain other dependents4 4 7#ab7 ,the table of sections for chapter #gg is amended by striking the item relating to section #gebg;,a and inserting the following new item3 ,sec4 #gebg;,a4 ,monthly payments of child tax credit4 4 7f7 ,effective dates 7#a7 ,in general ,except as otherwise provided in this subsection1 the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 7#b7 ,monthly advance child payments ,the amendments made by subsection 7b7 shall apply to-- 7,a7 calendar months beginning after the date of the enactment of this ,act1 and 7,b7 in the case of section #gebg;,a7g7 of the ,internal ,revenue ,code of #aihf 7relating to grace periods and hardships71 calendar months beginning after ,december #ca1 #bjbe4 7#c7 ,information disclosure ,the amendment made by subsection 7d7 shall take effect on the date of the enactment of this ,act4 ,b ,child and dependent care #cbjja4 ,enhancement of ,child and ,dependent ,care ,tax ,credit 7a7 ,in general ,paragraph 7#b7 of section #ba7;a7 is amended to read as follows3 7#b7 ,applicable percentage 7,a7 ,in general ,for purposes of paragraph 7#a71 the term applicable percentage means #ej percent reduced 7but not below the phaseout percentage7 by #a percentage point for each #b1jjj 7or fraction thereof7 by which the taxpayer's adjusted gross income for the taxable year exceeds #abe1jjj4 7,b7 ,phaseout percentage ,for purposes of subparagraph 7,a71 the term phaseout percentage means #bj percent reduced 7but not below zero7 by #a percentage point for each #b1jjj 7or fraction thereof7 by which the taxpayer's adjusted gross income for the taxable year exceeds #djj1jjj4 4 7b7 ,increase in dollar limit on amount creditable ,subsection 7c7 of section #ba is amended-- 7#a7 in paragraph 7#a71 by striking #c1jjj and inserting #h1jjj2 and 7#b7 in paragraph 7#b71 by striking #f1jjj and inserting #af1jjj4 7c7 ,special rule for married couples filing separate returns ,paragraph 7#b7 of section #ba7;e7 is amended to read as follows3 7#b7 ,married couples filing separate returns 7,a7 ,in general ,in the case of married individuals who do not file a joint return for the taxable year-- 7i7 the applicable percentage under subsection 7a77#b7 and the number of qualifying individuals and aggregate amount excludable under section #abi for purposes of subsection 7c7 shall be determined with respect to each such individual as if the individual had filed a joint return with the individual's spouse1 and 7ii7 the aggregate amount of the credits allowed under this section for such taxable year with respect to both spouses shall not exceed the amount which would have been allowed under this section if the individuals had filed a joint return4 7,b7 ,regulations ,the ,secretary shall prescribe such regulations or other guidance as is necessary to carry out the purposes of this subsection4 4 7d7 ,adjustment for inflation ,section #ba is amended by adding at the end the following new subsection3 7i7 ,inflation adjustment 7#a7 ,in general ,in the case of a calendar year beginning after #bjbf1 the #abe1jjj amount in paragraph 7#b7 of subsection 7a7 and the dollar amounts in subsection 7c7 shall each be increased by an amount equal to-- 7,a7 such dollar amount1 multiplied by 7,b7 the cost-of-living adjustment determined under section #a7;f77#c7 for the calendar year in which the taxable year begins1 determined by substituting calendar year #bjbe for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 7#b7 ,rounding ,if any dollar amount1 after being increased under paragraph 7#a71 is not a multiple of #ajj1 such dollar amount shall be rounded to the next lowest multiple of #ajj4 4 7e7 ,credit made refundable ,section #ba7;g7 is amended to read as follows3 7g7 ,credit made refundable for certain individuals ,if the taxpayer 7in the case of a joint return1 either spouse7 has a principal place of abode in the ,united ,states 7determined as provided in section #cb7 for more than one-half of the taxable year1 the credit allowed under subsection 7a7 shall be treated as a credit allowed under subpart ,c 7and not allowed under this subpart74 4 7f7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #cbjjb4 ,increased maximum contribution to dependent care assistance programs 7a7 ,in general ,section #abi7;a77#b77;,a7 is amended by striking #e1jjj 7#b1ejj and inserting #aj1jjj 7#e1jjj4 7b7 ,cost-of-,living adjustment ,section #abi is amended by adding at the end the following new subsection3 7f7 ,inflation adjustment 7#a7 ,in general ,each dollar amount in this section shall be increased by an amount equal to-- 7,a7 such dollar amount1 multiplied by 7,b7 the cost-of-living adjustment determined under section #a7;f77#c7 for the calendar year in which such taxable year begins1 determined by substituting calendar year #bjbd for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 7#b7 ,rounding ,if any increase under paragraph 7#a7 is not a multiple of #ej1 such increase shall be rounded to the nearest multiple of #ej4 4 7c7 ,removing deadwood ,section #abi7;a77#b7 is amended by striking subparagraph 7,d74 7d7 ,effective date ,the amendments made by this section shall apply to calendar years beginning after ,december #ca1 #bjbe4 #cbjjc4 ,credit for working family caregivers 7a7 ,in general ,subpart ,a of part ,,iv of subchapter ,a of chapter #a is amended by inserting after section #be;,e the following new section3 #be;,f4 ,working family caregivers 7a7 ,allowance of credit ,in the case of an eligible caregiver1 there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to #cj percent of the qualified expenses paid by the taxpayer during the taxable year to the extent that such expenses exceed #b1jjj4 7b7 ,limitation 7#a7 ,in general ,the amount allowed as a credit under subsection 7a7 for the taxable year shall not exceed #e1jjj4 7#b7 ,adjustment for inflation ,in the case of any taxable year beginning after #bjbf1 the dollar amount contained in paragraph 7#a7 shall be increased by an amount equal to the product of-- 7,a7 such dollar amount1 and 7,b7 the medical care cost adjustment determined under section #bac7;d77#aj77;,b77ii7 for the calendar year in which the taxable year begins1 determined by substituting #bjbe for #aiif in subclause 7,,ii7 thereof4 ,if any increase determined under the preceding sentence is not a multiple of #ej1 such increase shall be rounded to the next lowest multiple of #ej4 7c7 ,eligible caregiver ,for purposes of this section1 the term eligible caregiver means an individual who-- 7#a7 during the taxable year pays or incurs qualified expenses in connection with providing care for a qualified care recipient1 and 7#b7 has earned income 7as defined in section #cb7;c77#b77 for the taxable year in excess of #g1ejj4 7d7 ,qualified care recipient ,for purposes of this section-- 7#a7 ,in general ,the term qualified care recipient means1 with respect to any taxable year1 any individual who-- 7,a7 is the spouse of the eligible caregiver1 or any other person who bears a relationship to the eligible caregiver described in any of subparagraphs 7,a7 through 7,h7 of section #aeb7;d77#b71 and 7,b7 has been certified1 before the due date for filing the return of tax for the taxable year1 by a licensed health care practitioner 7as defined in section #ggjb;,b7c77#d77 as being an individual with long-term care needs described in paragraph 7#c7 for a period-- 7i7 which is at least #ahj consecutive days1 and 7ii7 a portion of which occurs within the taxable year4 7#b7 ,period for making certification ,notwithstanding paragraph 7#a77;,b71 a certification shall not be treated as valid unless it is made within the #cia_/b-month period ending on such due date 7or such other period as the ,secretary prescribes74 7#c7 ,individuals with long-term care needs ,an individual is described in this paragraph if the individual meets any of the following requirements3 7,a7 ,the individual is at least #f years of age and-- 7i7 is unable to perform 7without substantial assistance from another individual7 at least #b activities of daily living 7as defined in section #ggjb;,b7c77#b77;,b77 due to a loss of functional capacity1 or 7ii7 requires substantial supervision to protect such individual from threats to health and safety due to severe cognitive impairment and is unable to perform1 without reminding or cuing assistance1 at least #a activity of daily living 7as so defined7 or to the extent provided in regulations prescribed by the ,secretary 7in consultation with the ,secretary of ,health and ,human ,services71 is unable to engage in age appropriate activities4 7,b7 ,the individual is at least #b but not #f years of age and is unable due to a loss of functional capacity to perform 7without substantial assistance from another individual7 at least #b of the following activities3 eating1 transferring1 or mobility4 7,c7 ,the individual is under #b years of age and requires specific durable medical equipment by reason of a severe health condition or requires a skilled practitioner trained to address the individual's condition to be available if the individual's parents or guardians are absent4 7e7 ,qualified expenses ,for purposes of this section-- 7#a7 ,in general ,subject to paragraph 7#d71 the term qualified expenses means expenditures for goods1 services1 and supports that-- 7,a7 assist a qualified care recipient with accomplishing activities of daily living 7as defined in section #ggjb;,b7c77#b77;,b77 and instrumental activities of daily living 7as defined in section #aiae7k77#f77;,f7 of the ,social ,security ,act 7#db ,u4,s4,c4 #acifn7k77#f77;,f7771 and 7,b7 are provided solely for use by such qualified care recipient4 7#b7 ,adjustment for other tax benefits ,the amount of qualified expenses otherwise taken into account under paragraph 7#a7 with respect to an individual shall be reduced by the sum of any amounts paid for the benefit of such individual for the taxable year which are-- 7,a7 taken into account under section #ba or #bac1 or 7,b7 excluded from gross income under section #abi1 #bbc7;f71 or #ebi;,a7c77#a77;,b74 7#c7 ,goods1 services1 and supports ,for purposes of paragraph 7#a71 goods1 services1 and supports 7as defined by the ,secretary7 shall include-- 7,a7 human assistance1 supervision1 cuing and standby assistance1 7,b7 assistive technologies and devices 7including remote health monitoring71 7,c7 environmental modifications 7including home modifications71 7,d7 health maintenance tasks 7such as medication management71 7,e7 information1 7,f7 transportation of the qualified care recipient1 7,g7 non-health items 7such as incontinence supplies71 and 7,h7 coordination of and services for people who live in their own home1 a residential setting1 or a nursing facility1 as well as the cost of care in these or other locations4 7#d7 ,qualified expenses for eligible caregivers ,for purposes of paragraph 7#a71 the following shall be treated as qualified expenses if paid or incurred by an eligible caregiver3 7,a7 ,expenditures for respite care for a qualified care recipient4 7,b7 ,expenditures for counseling1 support groups1 or training relating to caring for a qualified care recipient4 7,c7 ,lost wages for unpaid time off due to caring for a qualified care recipient as verified by an employer4 7,d7 ,travel costs of the eligible caregiver related to caring for a qualified care recipient4 7,e7 ,expenditures for technologies1 as determined by the ,secretary1 that assist an eligible caregiver in providing care for a qualified care recipient4 7#e7 ,human assistance ,the term human assistance includes the costs of a direct care worker4 7#f7 ,documentation ,an expense shall not be taken into account under this section unless the eligible caregiver substantiates such expense under such regulations or guidance as the ,secretary shall provide4 7#g7 ,mileage rate ,for purposes of this section1 the mileage rate for the use of a passenger automobile shall be the standard mileage rate used to calculate the deductible costs of operating an automobile for medical purposes4 ,such rate may be used in lieu of actual automobile-related travel expenses4 7#h7 ,coordination with ,,able ,accounts ,qualified expenses for a taxable year shall not include contributions to an ,,able account 7as defined in section #ebi;,a74 7f7 ,phase ,out ,based on ,adjusted ,gross ,income ,for purposes of this section-- 7#a7 ,in general ,the amount of the credit allowable under subsection 7a7 shall be reduced 7but not below zero7 by #ajj for each #a1jjj 7or fraction thereof7 by which the taxpayer's modified adjusted gross income exceeds the threshold amount4 7#b7 ,modified adjusted gross income ,the term modified adjusted gross income means adjusted gross income increased by any amount excluded from gross income under section #iaa1 #ica1 or #icc4 7#c7 ,threshold amount ,the term threshold amount means-- 7,a7 #aej1jjj in the case of a joint return1 and 7,b7 #ge1jjj in any other case4 7#d7 ,indexing ,in the case of any taxable year beginning in a calendar year after #bjbf1 each dollar amount contained in paragraph 7#c7 shall be increased by an amount equal to the product of-- 7,a7 such dollar amount1 and 7,b7 the cost-of-living adjustment determined under section #a7;f77#c7 for the calendar year in which the taxable year begins1 determined by substituting calendar year #bjbe for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 7#e7 ,rounding rule ,if any increase determined under paragraph 7#d7 is not a multiple of #ej1 such increase shall be rounded to the next lowest multiple of #ej4 7g7 ,identification requirements ,no credit shall be allowed under this section to a taxpayer with respect to any qualified care recipient unless the taxpayer includes the name and taxpayer identification number of such individual1 and the identification number of the licensed health care practitioner certifying such individual1 on the return of tax for the taxable year4 4 7b7 ,clerical amendment ,the table of sections for subpart ,a of part ,,iv of subchapter ,a of chapter #a is amended by inserting after the item relating to section #be;,e the following new item3 ,sec4 #be;,f4 ,working family caregivers4 4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #cbjjd4 ,licensed family child care credit 7a7 ,in general ,subpart ,c of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by inserting after section #cf;,d the following new section3 #cf;,e4 ,licensed family child care credit 7a7 ,in general ,in the case of a qualified taxpayer1 there shall be allowed as a credit against the tax imposed by this subtitle for any taxable year an amount equal to so much of the qualified child care startup expenses of the taxpayer for such taxable year or for the preceding taxable year as do not exceed #e1jjj4 7b7 ,qualified taxpayer ,for purposes of this section1 the term qualified taxpayer means1 with respect to a taxable year1 a taxpayer that operates a qualified family child care provider4 7c7 ,qualified family child care provider ,for purposes of this section1 the term qualified family child care provider means a family child care provider that1 with respect to a taxable year-- 7#a7 provides child care services for compensation that1 as of the last day of such taxable year1 is licensed or registered under ,state law and satisfies ,state and local requirements applicable to the child care services it provides1 7#b7 primarily provides child care at the taxpayer's primary residence1 and 7#c7 provided child care services to not less than #b children 7excluding children of such taxpayer7 for a significant portion of such taxable year4 7d7 ,qualified child care startup expenses ,for purposes of this section1 the term qualified child care startup expenses means amounts paid or incurred for any of the following in order to establish and operate a qualified family child care provider3 7#a7 ,child care licensing fees4 7#b7 ,child care supplies including diapers1 food1 toys1 and learning materials4 7#c7 ,liability insurance4 7#d7 ,fencing and installation of such fencing4 7#e7 ,outdoor playground equipment and installation of such equipment4 7#f7 ,furniture necessary to provide child care4 7#g7 ,salary of an employee other than the taxpayer4 7#h7 ,printer and computers4 7#i7 ,professional training required as a condition of ,state licensure or registration4 7#aj7 ,remediation or renovation of the taxpayer's primary residence required as a condition of ,state licensure or registration4 7e7 ,limitations ,no credit shall be allowed under subsection 7a7 to any taxpayer to whom a credit was allowed under such subsection in any other taxable year4 7f7 ,denial of double benefit ,no credit shall be allowed under subsection 7a7 for any expense for which a deduction or credit is allowed under any other provision of this chapter4 7g7 ,regulations ,the ,secretary shall issue such regulations or other guidance as may be necessary or appropriate to carry out the purposes of this section1 including regulations relating to such information reporting and coordination with state and local licensing or registration entities as the ,secretary determines appropriate4 7h7 ,sunset ,no credit shall be allowed under subsection 7a7 for any taxable year beginning after the date that is #g years after the date of the enactment of this section4 4 7b7 ,conforming amendments 7#a7 ,section #fbaa7;b77#d77;,a71 as amended by the preceding provisions of this ,act1 is amended by inserting #cf;,e1 after #cf;,d14 7#b7 ,section #acbd7;b77#b7 of title #ca1 ,united ,states ,code1 as amended by the preceding provisions of this ,act1 is amended by inserting #cf;,e1 after #cf;,d14 7c7 ,clerical amendment ,the table of sections for subpart ,c of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by inserting after the item relating to section #cf;,b the following new item3 ,sec4 #cf;,e4 ,licensed family child care credit4 4 7d7 ,effective date ,the amendments made by this section shall apply to amounts paid or incurred after the date of the enactment of this ,act4 ,c ,ensuring affordable adoptions #ccjja4 ,refundable adoption tax credit 7a7 ,credit made refundable 7#a7 ,credit moved to subpart relating to refundable credits ,the ,internal ,revenue ,code of #aihf1 as amended by the preceding provisions of this ,act1 is amended-- 7,a7 by redesignating section #bc as section #cf;,f1 and 7,b7 by moving section #cf;,f 7as so redesignated7 from subpart ,a of part ,,iv of subchapter ,a of chapter #a to the location immediately before section #cg in subpart ,c of part ,,iv of subchapter ,a of chapter #a4 7#b7 ,conforming ,amendments 7,a7 ,section #be7;e77#a77;,c7 is amended by striking sections #bc and #be;,d and inserting section #be;,d4 7,b7 ,section #cf;,e1 as so redesignated1 is amended-- 7i7 in subsection 7b77#b77;,a71 by striking 7determined without regard to subsection 7c771 7ii7 by striking subsection 7c71 and 7iii7 by redesignating subsections 7d7 through 7i7 as subsections 7c7 through 7h71 respectively4 7,c7 ,section #acg is amended-- 7i7 in subsection 7d71 by striking section #bc7;d7 and inserting section #cf;,f7c71 and 7ii7 in subsection 7e71 by striking subsections 7e71 7f71 and 7g7 of section #bc and inserting subsections 7d71 7e71 and 7f7 of section #cf;,f4 7,d7 ,section #ajaf7;a77#bf7 is amended by striking #bc7;g7 and inserting #cf;,f7f74 7,e7 ,section #fbaa7;b77#d77;,a71 as amended by the preceding provisions of this ,act1 is amended by inserting #cf;,f1 after #cf;,e14 7,f7 ,the table of sections for subpart ,a of part ,,iv of subchapter ,a of chapter #a is amended by striking the item relating to section #bc4 7,g7 ,paragraph 7#b7 of section #acbd7;b7 of title #ca1 ,united ,states ,code1 as amended by the preceding provisions of this ,act1 is amended by inserting #cf;,f1 after #cf;,e14 7,h7 ,paragraph 7#cc7 of section #dga7;a7 of the ,social ,security ,act 7#db ,u4,s4,c4 #fga7;a77 is amended by striking section #bc and inserting section #cf;,f4 7,i7 ,the table of sections for subpart ,c of part ,,iv of subchapter ,a of chapter #a1 as amended by the preceding provisions of this ,act1 is amended by inserting after the item relating to section #cf;,e the following new item3 ,sec4 #cf;,f4 ,adoption expenses44 7b7 ,third-,party affidavits ,section #cf;,f7h71 as redesignated and moved by subsection 7a71 is amended-- 7#a7 by striking such regulations and inserting such regulations and guidance1 7#b7 by striking including regulations which treat and inserting including regulations and guidance which-- 7#a7 treat 1 7#c7 by striking the period at the end and inserting 1 and1 and 7#d7 by adding at the end the following3 7#b7 provide for a standardized third-party affidavit for purposes of verifying a legal adoption-- 7,a7 of a type with respect to which qualified adoption expenses may be paid or incurred1 or 7,b7 involving a child with special needs for purposes of subsection 7a77#c74 4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 7d7 ,transitional rule ,to treat carryforward as refundable credit ,in the case of any excess described in section #bc7;c7 of the ,internal ,revenue ,code of #aihf with respect to any taxpayer for the taxable year which precedes the first taxable year to which the amendments made by this section apply1 such excess shall be added to the credit allowable under section #cf;,f7a7 of such ,code with respect to such taxpayer for such first taxable year4 ,,iv ,education and workforce training ,a ,ensuring affordable higher education #dajja4 ,american opportunity credit expanded to #f years1 made temporarily fully refundable 7a7 ,in general ,section #be;,a7i7 is amended-- 7#a7 in subsection 7b77#b7-- 7,a7 in subparagraph 7,a7-- 7i7 in the heading1 by striking #d taxable years and inserting #f taxable years1 and 7ii7 by striking #d prior taxable years and inserting #f taxable years1 and 7,b7 in subparagraph 7,c7-- 7i7 in the heading1 by striking first #d years and inserting first #f years1 and 7ii7 by striking the first #d years and inserting the first #f years1 and 7#b7 by redesignating subsection 7j7 as subsection 7k7 and by inserting after subsection 7i7 the following3 7j7 ,american ,opportunity ,tax ,credit made fully refundable for #bjbf ,in the case of a taxable year beginning after ,december #ca1 #bjbe1 and before ,january #a1 #bjbg1 subsection 7i7 shall be applied by substituting #ajj percent for forty percent4 4 7b7 ,effective date ,the amendments made by subsection 7a7 shall apply to taxable years beginning after ,december #ca1 #bjbe4 7c7 ,outreach campaign 7#a7 ,in general ,the ,secretary of the ,treasury 7or the ,secretary's delegate7 shall conduct an outreach campaign to-- 7,a7 provide information to the public regarding the expansion of the ,american ,opportunity ,credit under section #be;,a of the ,internal ,revenue ,code of #aihf1 as amended by this ,act1 and 7,b7 assist individuals with claiming such credit4 7#b7 ,methods ,with respect to the outreach campaign described in paragraph 7a71 the ,secretary shall-- 7,a7 provide relevant information on the public website of the ,internal ,revenue ,service1 and 7,b7 send communications via direct mailing and electronic mail to individuals who have been identified as eligible for such credit for the taxable year4 #dajjb4 ,expansion of ,pell ,grant exclusion from gross income 7a7 ,in general ,section #aag7;b77#a7 is amended by striking received by an individual and all that follows and inserting received by an individual-- 7,a7 as a scholarship or fellowship grant to the extent the individual establishes that1 in accordance with the conditions of the grant1 such amount was used for qualified tuition and related expenses1 or 7,b7 as a ,federal ,pell ,grant under section #dja of the ,higher ,education ,act of #aife 7as in effect on the date of the enactment of this subparagraph74 4 7b7 ,no adjustment under ,american ,opportunity and ,lifetime ,learning ,credits ,section #be;,a7g77#b77;,a7 is amended by striking a qualified scholarship which and inserting a qualified scholarship which is described in section #aag7;b77#a77;,a7 and which4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #dajjc4 ,expansion of ,american ,opportunity and ,lifetime ,learning ,credits 7a7 ,in general ,section #be;,a is amended-- 7#a7 in subsection 7f77#a7-- 7,a7 in subparagraph 7,a71 by striking tuition and fees and inserting tuition1 fees1 computer or peripheral equipment1 child and dependent care expenses1 and course materials1 7,b7 by striking subparagraph 7,d71 and 7,c7 by adding at the end the following new subparagraphs3 7,d7 ,child and dependent care expenses ,for purposes of this paragraph-- 7i7 ,in general ,the term child and dependent care expenses means amounts paid for the following expenses1 but only if such expenses are incurred to enable the taxpayer to be enrolled in an eligible educational institution for any period for which there are #a or more qualifying individuals with respect to the taxpayer3 7,i7 expenses for household services1 and 7,,ii7 expenses for the care of a qualifying individual4 ,such term shall not include any amount paid for services outside the taxpayer's household at a camp where the qualifying individual stays overnight4 7ii7 ,qualifying individual ,the term qualifying individual has the meaning given such term in section #ba7;b77#a74 7iii7 ,exception1 dependent care centers ,rules similar to the rules of subparagraphs 7,b71 7,c71 and 7,d7 of section #ba7;b77#b7 shall apply1 except the term child and dependent care expenses shall be substituted for the term employment-related expenses each place it appears in such subparagraphs4 7,e7 ,child and dependent care expenses only qualified expenses when claimed by eligible student ,amounts paid for an expense described in subparagraph 7,e7 may not be taken into account under this paragraph for a taxable year unless required for the enrollment or attendance of an individual described in subparagraph 7,a77i7 or subparagraph 7,a77ii74 7,f7 ,computer or peripheral equipment 7i7 ,defined ,for purposes of this paragraph1 the term computer or peripheral equipment means expenses for the purchase of computer or peripheral equipment 7as defined in section #afh7;i77#b77;,b71 computer software 7as defined in section #aig7;e77#c77;,b7771 or internet access and related services1 if such equipment1 software1 or services are to be used primarily by the individual during any of the years the individual is enrolled at an eligible educational institution4 7ii7 ,dollar limit on amount creditable ,the aggregate of the amounts paid or expenses incurred for computer or peripheral equipment which may be taken into account under this paragraph for a taxable year by the taxpayer shall not exceed #a1jjj4 1 and 7#b7 in subsection 7g77#e7-- 7,a7 in the heading1 by adding or credit at the end1 and 7,b7 by inserting or credit after a deduction4 7b7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #dajjd4 ,elimination of denial of ,american ,opportunity ,tax ,credit for students convicted of a felony drug offense 7a7 ,in general ,section #be;,a7b77#b7 is amended by striking subparagraph 7,d74 7b7 ,effective date ,the amendment made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #dajje4 ,modification of treatment of student loan forgiveness 7a7 ,in general ,section #ajh7;f7 is amended-- 7#a7 by amending paragraph 7#a7 to read as follows3 7#a7 ,in general ,in the case of an individual1 gross income does not include any amount which 7but for this subsection7 would be includible in gross income by reasons of the discharge 7in whole or in part7 of-- 7,a7 any loan provided expressly for postsecondary educational expenses1 regardless of whether provided through the educational institution or directly to the borrower1 if such loan was made1 insured1 or guaranteed by-- 7i7 the ,united ,states1 or an instrumentality or agency thereof1 7ii7 a ,state1 territory1 or possession of the ,united ,states1 or the ,district of ,columbia1 or any political subdivision thereof1 or 7iii7 any institution of higher education1 7,b7 any private education loan 7as defined in section #adj7;a77#g7 of the ,truth in ,lending ,act71 7,c7 any loan made by any educational organization described in section #agj7;b77#a77;,a77ii7 if such loan is made-- 7i7 pursuant to an agreement with any entity described in subparagraph 7,a7 or any private education lender 7as defined in section #adj7;a7 of the ,truth in ,lending ,act7 under which the funds from which the loan was made were provided to such educational organization1 or 7ii7 pursuant to a program of such educational organization which is designed to encourage its students to serve in occupations with unmet needs or in areas with unmet needs and under which the services provided by the students 7or former students7 are for or under the direction of a governmental unit or an organization described in section #eja7;c77#c7 and exempt from tax under section #eja7;a71 or 7,d7 any loan made by an educational organization described in section #agj7;b77#a77;,a77ii7 or by an organization exempt from tax under section #eja7;a7 to refinance a loan to an individual to assist the individual in attending any such educational organization but only if the refinancing loan is pursuant to a program of the refinancing organization which is designed as described in subparagraph 7,c77ii74 1 7#b7 by striking paragraphs 7#b7 and 7#e71 7#c7 by redesignating paragraphs 7#c7 and 7#d7 as paragraphs 7#b7 and 7#c71 respectively1 and 7#d7 in paragraph 7#b71 as so redesignated1 by-- 7,a7 striking made by an organization described in paragraph 7#b77;,d7 and inserting made by an organization described in paragraph 7#a77;,c7 or made by a private education lender 7as defined in section #adj7;a77#g7 of the ,truth in ,lending ,act71 and 7,b7 inserting or for such private education lender after either such organization4 7b7 ,effective ,date ,the amendments made by this section shall apply to discharges of loans after ,december #ca1 #bjbe4 #dajjf4 ,student loan interest deduction limitation applied separately to each spouse 7a7 ,in general ,section #bba7;b77#a7 is amended to read as follows3 7#a7 ,in general ,the interest taken into account with respect to a taxpayer for a taxable year under subsection 7a7 for indebtedness incurred by an individual shall not exceed #b1ejj4 4 7b7 ,conforming amendments ,section #bba is amended-- 7#a7 in subsection 7b71 by striking the heading and inserting ,dollar limitations1 and 7#b7 by amending subsection 7e7 to read as follows3 7e7 ,denial of double benefit ,no deduction shall be allowed under this section for any amount for which a deduction is allowable under any other provision of this chapter4 4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 ,b ,supporting our workforce #dbjja4 ,educator expense deduction to include early childhood educators 7a7 ,in general ,section #fb is amended-- 7#a7 in subsection 7a77#b77;,d71 by striking the heading and inserting ,certain expenses of early childhood1 elementary1 and secondary school teachers42 7#b7 in subsection 7d77#a77;,a71 by striking kindergarten through grade #ab teacher and inserting1 early childhood educator1 kindergarten through grade #ab teacher2 and 7#c7 in subsection 7d77#a77;,b71 by striking elementary education or secondary education 7kindergarten through grade #ab7 and inserting1 early childhood education1 elementary education1 or secondary education 7pre-kindergarten through grade #ab74 7b7 ,effective date ,the amendments made by this section shall apply to expenses incurred in taxable years beginning after ,december #ca1 #bjbe4 #dbjjb4 ,allowance of deduction for certain expenses of the trade or business of being an employee 7a7 ,above-the-,line deduction for union dues and expenses ,section #fb7;a77#a7 is amended by adding at the end the following new sentence3 ,the limitation under the preceding sentence shall not apply to deductions which are attributable to a trade or business consisting of the performance of services by the taxpayer as an employee if such deductions are for union dues and expenses44 7b7 ,allowance of miscellaneous itemized deduction for other expenses of the trade or business of being an employee ,section #fg7;g7 is amended-- 7#a7 by striking #bjbe4--,notwithstanding subsection 7a71 and inserting 8#bjbe4-- 7#a7 ,in general ,notwithstanding subsection 7a71 except as provided in paragraph 7#b71 2 and 7#b7 by adding at the end the following3 7#b7 ,exception for expenses of the trade or business of being an employee 7,a7 ,in general ,paragraph 7#a7 shall not apply to miscellaneous itemized deductions for any taxable year which are itemized deductions attributable to a trade or business carried on by the taxpayer which consists of the performance of services by the taxpayer as an employee4 7,b7 ,application of #b-percent test ,in applying subsection 7a7 for any taxable year to which this paragraph applies1 only the itemized deductions described in subparagraph 7,a7 shall be taken into account as miscellaneous itemized deductions4 4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #dbjjc4 ,modification of deduction for cash tips 7a7 ,made permanent ,section #bbd is amended by striking subsection 7h74 7b7 ,application of limitation on individual basis ,section #bbd7;b77#a7 is amended by inserting to an individual after amount allowed as a deduction under this section4 7c7 ,treatment of automatic gratuities ,section #bbd7;d7 is amended by adding at the end the following new paragraph3 7#d7 ,treatment of certain automatic gratuities 7,a7 ,in general ,in the case of an individual engaged in an occupation in hospitality1 food and beverage service1 or cosmetology1 the term qualified tips shall include automatic gratuities4 7,b7 ,automatic gratuity ,for purposes of this paragraph1 the term automatic gratuity means1 with respect to an individual1 any amount which-- 7i7 would be a qualified tip with respect to the individual but for paragraph 7#b77;,a71 and 7ii7 is a mandatory or suggested amount paid pursuant to a uniform policy of the employer1 under which such entire amount is received by the individual or1 under ,state or local law1 is pooled and received only by employees of the employer under a tip-sharing arrangement4 4 7d7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #dbjjd4 ,deduction for certain overtime compensation 7a7 ,in general ,section #bbe7;c77#a7 is amended to read as follows3 7#a7 ,in general ,for purposes of this section1 the term qualified overtime compensation means-- 7,a7 any overtime compensation paid to an individual required under section #g of the ,fair ,labor ,standards ,act of #aich that is in excess of the regular rate 7as used in such section7 at which such individual is employed1 or 7,b7 any compensation paid to an individual that is in excess of the regular rate at which such individual is employed if-- 7i7 such compensation is paid for work for a single employer pursuant to an agreement between the employee 7or labor organization representing such employee7 and employer entered into before the performance of the work1 and 7ii7 either-- 7,i7 such work is in excess of a standard number of hours of such work for a specified period of time1 and such agreement specifies that such standard number of hours for a specified period of time is not less than #dj hours for a #g-;day work period1 or 7,,ii7 if the employee 7including any crewmember or flight crewmember1 or rail operating craft employee7 and employer referred to in clause 7i7 are both covered by the ,railway ,labor ,act1 such work is beyond scheduled or anticipated hours on duty or for hours on duty that exceed a maximum number of hours with respect to a specified period of time 7as determined pursuant to such agreement74 4 7b7 ,effective date ,the amendment made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #dbjje4 ,above-the-line deduction of expenses of performing artists 7a7 ,in general ,section #fb7;a77#b77;,b7 is amended-- 7#a7 by striking performing artists4--,the deductions and inserting the following3 performing artists4-- 7i7 ,in general ,the deductions 1 and 7#b7 by adding at the end the following new clauses3 7ii7 ,phaseout ,the amount of expenses taken into account under clause 7i7 shall be reduced 7but not below zero7 by #aj percentage points for each #b1jjj 7#d1jjj in the case of a joint return71 or fraction thereof1 by which the taxpayer's gross income for the taxable year exceeds #ajj1jjj 7#bjj percent of such amount in the case of a joint return74 7iii7 ,cost-of-living adjustment ,in the case of any taxable year beginning in a calendar year after #bjbf1 the #ajj1jjj amount under clause 7ii7 shall be increased by an amount equal to-- 7,i7 such dollar amount1 multiplied by 7,,ii7 the cost-of-living adjustment determined under section #a7;f77#c7 for the calendar year in which the taxable year begins1 determined by substituting calendar year #bjbe for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 ,if any amount after adjustment under the preceding sentence is not a multiple of #a1jjj1 such amount shall be rounded to the nearest multiple of #a1jjj4 4 7b7 ,clarification regarding commission paid to performing artist's manager or agent ,section #fb7;a77#b77;,b77i71 as amended by subsection 7a71 is amended by inserting before the period at the end the following3 1 including any commission paid to the performing artist's manager or agent4 7c7 ,increase in threshold for determining nominal employers ,section #fb7;b77#b7 is amended-- 7#a7 by striking ,an individual and inserting the following3 7,a7 ,in general ,an individual 1 7#b7 by striking #bjj and inserting #ejj1 and 7#c7 by adding at the end the following new subparagraph3 7,b7 ,cost-of-living adjustment ,in the case of any taxable year beginning in a calendar year after #bjbf1 the #ejj amount under subparagraph 7,a7 shall be increased by an amount equal to-- 7i7 such dollar amount1 multiplied by 7ii7 the cost-of-living adjustment determined under section #a7;f77#c7 for the calendar year in which the taxable year begins1 determined by substituting calendar year #bjbe for calendar year #bjaf in subparagraph 7,a77ii7 thereof4 ,if any amount after adjustment under the preceding sentence is not a multiple of #ej1 such amount shall be rounded to the nearest multiple of #ej4 4 7d7 ,conforming amendments 7#a7 ,section #fb7;a77#b77;,b77i71 as amended by the preceding provisions of this ,act1 is amended by striking by him and inserting by the performing artist4 7#b7 ,section #fb7;b77#a7 is amended by inserting and at the end of subparagraph 7,a71 by striking 1 and at the end of subparagraph 7,b7 and inserting a period1 and by striking subparagraph 7,c74 7e7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #dbjjf4 ,permanent extension of earned income credit rules for individuals without qualifying children 7a7 ,decrease in minimum age for credit 7#a7 ,in general ,subclause 7,,ii7 of section #cb7;c77#a77;,a77ii7 is amended by striking age #be and inserting the applicable minimum age4 7#b7 ,applicable minimum age ,paragraph 7#a7 of section #cb7;c7 is amended by adding at the end the following new subparagraph3 7,f7 ,applicable minimum age ,for purposes of this paragraph-- 7i7 ,in general ,the term applicable minimum age means-- 7,i7 except as otherwise provided in this clause1 age #ai1 7,,ii7 in the case of a student 7as defined in section #aeb7;f77#b771 other than a qualified former foster youth or a qualified homeless youth1 age #bd1 and 7,,iii7 in the case of a qualified former foster youth or a qualified homeless youth1 age #ah4 7ii7 ,qualified former foster youth ,for purposes of this subparagraph1 the term qualified former foster youth means an individual who-- 7,i7 on or after the date that such individual attained age #ad1 was in foster care provided under the supervision or administration of an entity administering 7or eligible to administer7 a plan under part ,b or part ,e of title ,,iv of the ,social ,security ,act 7without regard to whether ,federal assistance was provided with respect to such child under such part ,e71 and 7,,ii7 provides 7in such manner as the ,secretary may provide7 consent for entities which administer a plan under part ,b or part ,e of title ,,iv of the ,social ,security ,act to disclose to the ,secretary information related to the status of such individual as a qualified former foster youth4 7iii7 ,qualified homeless youth ,for purposes of this subparagraph1 the term qualified homeless youth means1 with respect to any taxable year1 an individual who certifies1 in a manner as provided by the ,secretary1 that such individual is either an unaccompanied youth who is a homeless child or youth1 or is unaccompanied1 at risk of homelessness1 and self-supporting4 4 7b7 ,elimination of maximum age for credit ,subclause 7,,ii7 of section #cb7;c77#a77;,a77ii7 is amended by striking but not attained age #fe4 7c7 ,increase in credit and phaseout percentages ,the table contained in paragraph 7#a7 of section #cb7;b7 is amended by striking #g4fe each place it appears and inserting #ae4c4 7d7 ,increase in earned income and phaseout amounts ,the table contained in subparagraph 7,a7 of section #cb7;b77#b7 is amended-- 7#a7 by striking #d1bbj and inserting #i1hbj1 and 7#b7 by striking #e1bhj and inserting #aa1faj4 7e7 ,inflation adjustments 7#a7 ,in general ,paragraph 7#a7 of section #cb7;j7 is amended to read as follows3 7#a7 ,in general ,in the case of any taxable year beginning after-- 7,a7 #bjba1 in the case of the dollar amount in subsection 7i77#a71 7,b7 #bjbf1 in the case of the dollar amounts in the third row of the table in subsection 7b77#b77;,a71 and 7,c7 #bjae1 in any other case1 each of the dollar amounts in subsections 7b77#b7 and 7i77#a7 shall be increased by an amount equal to the inflation amount4 4 7#b7 ,inflation amount ,subsection 7j7 of section #cb is amended by adding at the end the following new paragraph3 7#c7 ,inflation amount ,for purposes of paragraph 7#a71 the inflation amount with respect to any dollar amount for any taxable year is the amount equal to-- 7,a7 such dollar amount1 multiplied by 7,b7 the percentage 7if any7 by which-- 7i7 the ,,cpi 7as defined in section #a7;f77#d77 for the calendar year preceding the year in which the taxable year begins1 exceeds 7ii7 the ,,cpi 7as so defined7 for-- 7,i7 in the case of amounts in the third row of the table in subsection 7b77#b77;,a71 #bjbe1 7,,ii7 in the case of any other amount in subsection 7b77#b77;,a71 #aiie1 7,,iii7 in the case of the #e1jjj amount in subsection 7b77#b77;,b71 #bjjh1 and 7,,iv7 in the case of the #aj1jjj amount in subsection 7i77#a71 #bjbj4 4 7f7 ,conforming amendment ,section #cb is amended by striking subsection 7n74 7g7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #dbjjg4 ,application of earned income credit to possessions of the ,united ,states 7a7 ,puerto ,rico ,subparagraph 7,b7 of section #gecj7;a77#a7 is amended by striking in the case of calendar years #bjba through #bjbe14 7b7 ,possessions with mirror code tax systems ,subparagraph 7,b7 of section #gecj7;b77#a7 is amended by striking in the case of calendar years #bjba through #bjbe14 7c7 ,american ,samoa ,subparagraph 7,b7 of section #gecj7;c77#a7 is amended by striking in the case of calendar years #bjba through #bjbe14 #dbjjh4 ,election to use prior year earned income for earned income tax credit 7a7 ,in general ,paragraph 7#b7 of section #cb7;c7 is amended by adding at the end the following new subparagraph3 7,c7 ,election to use prior year earned income 7i7 ,in general ,if the earned income of the taxpayer for any taxable year is less than the earned income of the taxpayer for the preceding taxable year1 the credit allowed under subsection 7a7 may1 at the election of the taxpayer1 be determined by substituting-- 7,i7 such earned income for such preceding taxable year1 for 7,,ii7 such earned income for the taxable year for which such credit is being determined4 7ii7 ,application to joint returns ,for purposes of clause 7i71 in the case of a joint return1 the earned income of the taxpayer for the preceding taxable year shall be the sum of the earned income of each spouse for such taxable year4 7iii7 ,special rules 7,i7 ,errors treated as mathematical errors ,for purposes of section #fbac1 an incorrect use on a return of earned income pursuant to clause 7i7 shall be treated as a mathematical or clerical error4 7,,ii7 ,no effect on determination of gross income1 etc ,except as otherwise provided in this subparagraph1 this title shall be applied without regard to any substitution under clause 7i74 4 7b7 ,effective date ,the amendment made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 ,v ,healthcare #ejjja4 ,increase in eligibility for health insurance premium assistance tax credit 7a7 ,in general ,subparagraph 7,a7 of section #cf;,b7c77#a7 is amended by striking but does not exceed #djj percent4 7b7 ,applicable percentages 7#a7 ,in general ,subparagraph 7,a7 of section #cf;,b7b77#c7 is amended to read as follows3 7,a7 ,applicable percentage ,the applicable percentage for any taxable year shall be the percentage such that the applicable percentage for any taxpayer whose household income is within an income tier specified in the following table shall increase1 on a sliding scale in a linear manner1 from the initial premium percentage to the final premium percentage specified in such table for such income tier3 ,in the case of household income 7expressed as a percent of poverty line7 within the following income tier3,the initial premium percentage is--,the final premium percentage is--,up to #aej percent#jjaej percent up to #bjj percent#jb4jbjj percent up to #bej percent#b4jd4jbej percent up to #cjj percent#d4jf4jcjj percent up to #djj percent#f4jh4edjj percent and higher#h4eh4e4 4 7#b7 ,conforming amendments relating to affordability of coverage 7,a7 ,paragraph 7#a7 of section #cf;,b7c7 is amended by striking subparagraph 7,e74 7,b7 ,subparagraph 7,c7 of section #cf;,b7c77#b7 is amended by striking clause 7iv74 7,c7 ,paragraph 7#d7 of section #cf;,b7c7 is amended by striking subparagraph 7,f74 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after ,december #ca1 #bjbe4 #ejjjb4 ,filling the coverage gap 7a7 ,ensuring affordability of coverage for certain low-,income populations ,section #adjb of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjga7 is amended-- 7#a7 in subsection 7b7-- 7,a7 in paragraph 7#b71 by inserting 7or1 with respect to plan years #bjbf1 #bjbg1 and #bjbh1 whose household income does not exceed #djj percent of the poverty line for a family of the size involved7 before the period2 and 7,b7 in the matter following paragraph 7#b71 by adding at the end the following new sentence3 ,in the case of an individual who is determined at any point to have a household income for #bjbe that does not exceed #ach percent of the poverty line for a family of the size involved1 such individual shall1 for each month during such year1 be treated as having a household income equal to #ajj percent for purposes of applying this section42 and 7#b7 in subsection 7c7-- 7,a7 in paragraph 7#a77;,a71 in the matter preceding clause 7i71 by inserting 1 with respect to eligible insureds 7other than1 with respect to plan years #bjbf1 #bjbg1 and #bjbh1 specified enrollees 7as defined in paragraph 7#f77;,c7771 after first be achieved2 7,b7 in paragraph 7#b71 in the matter preceding subparagraph 7,a71 by inserting with respect to eligible insureds 7other than1 with respect to plan years #bjbf1 #bjbg1 and #bjbh1 specified enrollees7 after under the plan2 7,c7 in paragraph 7#c7-- 7i7 in subparagraph 7,a71 by striking this subsection and inserting paragraph 7#a7 or 7#b72 and 7ii7 in subparagraph 7,b71 by striking this section and inserting paragraphs 7#a7 and 7#b72 and 7,d7 by adding at the end the following new paragraph3 7#f7 ,special rule for specified enrollees 7,a7 ,in general ,the ,secretary shall establish procedures under which the issuer of a qualified health plan to which this section applies shall reduce cost-sharing under the plan with respect to months occurring during plan years #bjbf1 #bjbg1 and #bjbh for enrollees who are specified enrollees 7as defined in subparagraph 7,c77 in a manner sufficient to increase the plan's share of the total allowed costs of benefits provided under the plan to #ii percent of such costs4 7,b7 ,methods for reducing cost sharing 7i7 ,in general ,an issuer of a qualified health plan making reductions under this paragraph shall notify the ,secretary of such reductions and the ,secretary shall1 out of funds made available under clause 7ii71 make periodic and timely payments to the issuer equal to #ab percent of the total allowed costs of benefits provided under each such plan to specified enrollees during plan years #bjbf1 #bjbg1 and #bjbh4 7ii7 ,appropriation ,in addition to amounts otherwise available1 there are appropriated1 out of any money in the ,treasury not otherwise appropriated1 such sums as may be necessary to the ,secretary to make payments under clause 7i74 7,c7 ,specified enrollee defined ,for purposes of this section1 the term specified enrollee means1 with respect to a plan year1 an eligible insured who is determined at any point to have a household income for such plan year that does not exceed #ach percent of the poverty line for a family of the size involved4 ,such insured shall be deemed to be a specified enrollee for each month in such plan year4 4 7b7 ,open enrollments applicable to certain lower-,income populations ,section #acaa7;c7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjca7;c77 is amended-- 7#a7 in paragraph 7#f7-- 7,a7 in subparagraph 7,c71 by striking at the end and2 7,b7 in subparagraph 7,d71 by striking the period at the end and inserting 2 and2 and 7,c7 by adding at the end the following new subparagraph3 7,e7 with respect to a qualified health plan with respect to which section #adjb applies1 for months occurring during the period beginning on ,january #a1 #bjbf1 and ending on ,december #ca1 #bjbh1 enrollment periods described in subparagraph 7,a7 of paragraph 7#h7 for individuals described in subparagraph 7,b7 of such paragraph4 2 and 7#b7 by adding at the end the following new paragraph3 7#h7 ,special enrollment period for certain low-income populations 7,a7 ,in general ,the enrollment period described in this paragraph is1 in the case of an individual described in subparagraph 7,b71 the continuous period beginning on the first day that such individual is so described4 7,b7 ,individual described ,for purposes of subparagraph 7,a71 an individual described in this subparagraph is an individual-- 7i7 with a household income that does not exceed #ach percent of the poverty line for a family of the size involved2 and 7ii7 who is not eligible for minimum essential coverage 7as defined in section #ejjj;,a7f7 of the ,internal ,revenue ,code of #aihf71 other than for coverage described in any of subparagraphs 7,b7 through 7,e7 of paragraph 7#a7 of such section4 4 7c7 ,additional benefits for certain low-,income individuals for plan years #bjbf and #bjbg ,section #acja7;a7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjba7;a77 is amended-- 7#a7 in paragraph 7#a7-- 7,a7 in subparagraph 7,b71 by striking and at the end2 7,b7 in subparagraph 7,c77iv71 by striking the period and inserting 2 and2 and 7,c7 by adding at the end the following new subparagraph3 7,d7 provides1 with respect to a plan offered in the silver level of coverage to which section #adjb applies during plan year #bjbf and #bjbg1 for benefits described in paragraph 7#e7 in the case of an individual who has a household income that does not exceed #ach percent of the poverty line for a family of the size involved1 and who is eligible to receive cost-sharing reductions under section #adjb4 2 and 7#b7 by adding at the end the following new paragraph3 7#e7 ,additional benefits for certain low-income individuals for plan year #bjbf and #bjbg 7,a7 ,in general 7i7 ,benefits ,for purposes of paragraph 7#a77;,d71 the benefits described in this paragraph to be provided by a qualified health plan are benefits consisting of-- 7,i7 non-emergency medical transportation services 7as described in section #aijb7;a77#d7 of the ,social ,security ,act7 for which ,federal payments would have been available under title ,,xix of the ,social ,security ,act had such services been furnished to an individual enrolled under a ,state plan 7or waiver of such plan7 under such title2 and 7,,ii7 services described in subsection 7a77#d77;,c7 of section #aije of such ,act for which ,federal payments would have been so available2 which are not otherwise provided under such plan as part of the essential health benefits package described in section #acjb7;a74 7ii7 ,condition on provision of benefits ,benefits described in this paragraph shall be provided-- 7,i7 without any restriction on the choice of a qualified provider from whom an individual may receive such benefits2 and 7,,ii7 without any imposition of cost sharing4 7,b7 ,payments for additional benefits 7i7 ,in general ,an issuer of a qualified health plan making payments for services described in subparagraph 7,a7 furnished to individuals described in paragraph 7#a77;,d7 during plan year #bjbf or #bjbg shall notify the ,secretary of such payments and the ,secretary shall1 out of funds made available under clause 7ii71 make periodic and timely payments to the issuer equal to payments for such services so furnished4 7ii7 ,appropriation ,in addition to amounts otherwise available1 there is appropriated1 out of any money in the ,treasury not otherwise appropriated1 such sums as may be necessary to the ,secretary to make payments under clause 7i74 4 7d7 ,education and outreach activities 7#a7 ,in general ,section #acba7;c7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjda7;c77 is amended by adding at the end the following new paragraph3 7#c7 ,outreach and educational activities 7,a7 ,in general ,in the case of an ,exchange established or operated by the ,secretary within a ,state pursuant to this subsection1 the ,secretary shall carry out outreach and educational activities for purposes of informing individuals described in section #aijb7;a77#aj77;,a77i77,,viii7 of the ,social ,security ,act who reside in ,states that have not expended amounts under a ,state plan 7or waiver of such plan7 under title ,,xix of such ,act for all such individuals about qualified health plans offered through the ,exchange1 including by informing such individuals of the availability of coverage under such plans and financial assistance for coverage under such plans4 ,such outreach and educational activities shall be provided in a manner that is culturally and linguistically appropriate to the needs of the populations being served by the ,exchange 7including hard-to-reach populations1 such as racial and sexual minorities1 limited ,english proficient populations1 individuals residing in areas where the unemployment rates exceeds the national average unemployment rate1 individuals in rural areas1 veterans1 and young adults74 7,b7 ,limitation on use of funds ,funds appropriated under this paragraph shall not be used to promote any health insurance coverage other than qualified health plans4 7,c7 ,funding ,in addition to amounts otherwise available1 there is appropriated1 out of any money in the ,treasury not otherwise appropriated1 to remain available until expended1 #aje1jjj1jjj for fiscal year #bjbf to carry out this paragraph1 of which-- 7i7 #ae1jjj1jjj shall be used to carry out this paragraph in fiscal year #bjbf2 and 7ii7 #cj1jjj1jjj shall be used to carry out this paragraph for each of fiscal years #bjbg through #bjbh4 4 7#b7 ,navigator program ,section #acaa7;i7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjca7;i77 is amended-- 7,a7 in paragraph 7#a7-- 7i7 by striking ,an ,exchange and inserting the following3 7,a7 ,in general ,an ,exchange 2 and 7ii7 by adding at the end the following3 7,b7 ,grants for eligible entities with respect to certain ,states ,the ,secretary shall establish a program to award grants to entities described in paragraph 7#b7 to carry out the duties described in paragraph 7#c7 in one or more ,states that do not provide under the ,state plan under title ,,xix of the ,social ,security ,act 7or a waiver of such plan7 benchmark coverage described in section #aicg7;b77#a7 of such ,act or benchmark equivalent coverage described in section #aicg7;b77#b7 of such ,act to all individuals described in section #aijb7;a77#aj77;,a77i77,,viii7 of such ,act4 2 and 7,b7 in paragraph 7#f7-- 7i7 by striking ,grants under and inserting the following3 7,a7 ,state ,exchanges ,grants under 2 and 7ii7 by adding at the end the following new subparagraph3 7,b7 ,federal ,exchanges2 grants to eligible entities with respect to certain ,states ,for purposes of carrying out this subsection1 with respect to an ,exchange established and operated by the ,secretary within a ,state pursuant to section #acba7;c7 and with respect to grants under paragraph 7#a77;,b71 the ,secretary shall obligate not less than #aj1jjj1jjj out of amounts collected through the user fees on participating health insurance issuers pursuant to section #aef4ej of title #de1 ,code of ,federal ,regulations 7or any successor regulations7 for fiscal year #bjbf1 and not less than #bj1jjj1jjj for each of fiscal years #bjbg and #bjbh4 ,such amount so obligated for a fiscal year shall remain available until expended4 4 7e7 ,funding ,in addition to amounts otherwise available1 there is appropriated to the ,secretary of ,health and ,human ,services for fiscal year #bjbf1 out of any money in the ,treasury not otherwise appropriated1 #fe1jjj1jjj1 to remain available until expended1 for purposes of carrying out the provisions of1 and the amendments made by1 this section 7other than subsections 7f7 and 7g774 7f7 ,temporary expansion of health insurance premium tax credits for certain low-,income populations 7#a7 ,in general ,section #cf;,b is amended by redesignating subsection 7h7 as subsection 7i7 and by inserting after subsection 7g7 the following new subsection3 7h7 ,certain temporary rules beginning in #bjbf ,with respect to any taxable year beginning after ,december #ca1 #bjbe1 and before ,january #a1 #bjbi-- 7#a7 ,eligibility for credit not limited based on income ,subsection 7c77#a77;,a7 shall be applied without regard to equals or exceeds #ajj percent but4 7#b7 ,credit allowed to certain low-income employees offered employer-provided coverage ,in the case of an individual whose household income does not exceed #ach percent of the poverty line for a family of the size involved1 clause 7i7 of subsection 7c77#b77;,c7 shall be applied 7including in the case of any individual described in the last sentence of such clause7 without regard to subclause 7,,ii7 thereof4 7#c7 ,credit allowed to certain low-income employees offered qualified small employer health reimbursement arrangements ,a qualified small employer health reimbursement arrangement shall not be treated as constituting affordable coverage for an employee 7or any spouse or dependent of such employee7 for any months of a taxable year if the employee's household income for such taxable year does not exceed #ach percent of the poverty line for a family of the size involved4 7#d7 ,limitations on recapture 7,a7 ,in general ,in the case of a taxpayer whose household income is less than #bjj percent of the poverty line for the size of the family involved for the taxable year1 the amount of the increase under subsection 7f77#b77;,a7 shall in no event exceed #cjj 7one-half of such amount in the case of a taxpayer whose tax is determined under section #a7;c7 for the taxable year74 7,b7 ,limitation on increase for certain non-filers ,in the case of any taxpayer who would not be required to file a return of tax for the taxable year but for any requirement to reconcile advance credit payments under subsection 7f71 if an ,exchange established under title ,i of the ,patient ,protection and ,affordable ,care ,act has determined that-- 7i7 such taxpayer is eligible for advance payments under section #adab of such ,act for any portion of such taxable year1 and 7ii7 such taxpayer's household income for such taxable year is projected not to exceed #ach percent of the poverty line for a family of the size involved1 subsection 7f77#b77;,a7 shall not apply to such taxpayer for such taxable year and such taxpayer shall not be required to file such return of tax4 7,c7 ,information provided by ,exchange ,the information required to be provided by an ,exchange to the ,secretary and to the taxpayer under subsection 7f77#c7 shall include such information as is necessary to determine whether such ,exchange has made the determinations described in clauses 7i7 and 7ii7 of subparagraph 7,b7 with respect to such taxpayer4 4 7#b7 ,employer shared responsibility provision not applicable with respect to certain low-,income taxpayers receiving premium assistance ,section #dihj;,h7c77#c7 is amended to read as follows3 7#c7 ,applicable premium tax credit and cost-sharing reduction 7,a7 ,in general ,the term applicable premium tax credit and cost-sharing reduction means-- 7i7 any premium tax credit allowed under section #cf;,b1 7ii7 any cost-sharing reduction under section #adjb of the ,patient ,protection and ,affordable ,care ,act1 and 7iii7 any advance payment of such credit or reduction under section #adab of such ,act4 7,b7 ,exception with respect to certain low-income taxpayers ,such term shall not include any premium tax credit1 cost-sharing reduction1 or advance payment otherwise described in subparagraph 7,a7 if such credit1 reduction1 or payment is allowed or paid for a taxable year of an employee 7beginning after ,december #ca1 #bjbe1 and before ,january #a1 #bjbi7 with respect to which-- 7i7 an ,exchange established under title ,i of the ,patient ,protection and ,affordable ,care ,act has determined that such employee's household income for such taxable year is projected to not exceed #ach percent of the poverty line for a family of the size involved1 or 7ii7 such employee's household income for such taxable year does not exceed #ach percent of the poverty line for a family of the size involved4 4 7#c7 ,effective date ,the amendments made by this subsection shall apply to taxable years beginning after ,december #ca1 #bjbe4 7g7 ,further increase in ,,fmap for ,medical ,assistance for ,newly ,eligible ,mandatory ,individuals ,section #aije7y77#a7 of the ,social ,security ,act 7#db ,u4,s4,c4 #acif;d7y77#a77 is amended-- 7#a7 in subparagraph 7,d71 by striking at the end and2 7#b7 in subparagraph 7,e71 by striking #bjbj and each year thereafter4 and inserting #bjbj1 #bjba1 #bjbb1 #bjbc1 #bjbd1 and #bjbe22 and 7#c7 by adding at the end the following new subparagraphs3 7,f7 #ic percent for calendar quarters in #bjbf1 #bjbg1 and #bjbh2 and 7,g7 #ij percent for calendar quarters in #bjbi and each year thereafter4 4 #ejjjc4 ,freeze of premium adjustment percentage increase ,section #acjb7;c77#d7 of the ,patient ,protection and ,affordable ,care ,act is amended-- 7#a7 by striking ,for purposes of and inserting the following3 7,a7 ,in general ,for purposes of 2 and 7#b7 by adding at the end the following new subparagraph3 7,b7 ,freeze in premium adjustment percentage increase ,for plan years beginning on or after ,january #a1 #bjbg1 the maximum annual limitation on cost sharing 7as described in section #aef4acj7;a77#b7 of title #de1 ,code of ,federal ,regulations7 is equal to the greater of-- 7i7 the maximum annual limitation on cost sharing for plan year #bjbe1 as described in the final rule published on ,april #ae1 #bjbd 7#hi ,fed4 ,reg4 #bfbah et seq472 and 7ii7 #ij percent of the amount described in clause 7i71 increased by the percentage by which the average per capita premium for health insurance coverage in the ,united ,states for the preceding calendar year 7as estimated by the ,secretary not later than ,october #a of such preceding calendar year7 exceeds such average per capita premium for #bjbd4 4 #ejjjd4 ,requiring coverage of certain immunizations recommended by the ,advisory ,committee on ,immunization ,practices 7a7 ,group health plans and health insurance coverage 7#a7 ,,phsa 7,a7 ,in general ,part ,d of title ,,xxvii of the ,public ,health ,service ,act 7#db ,u4,s4,c4 #cjj;gg-#aaa et seq47 is amended by adding at the end the following new section3 #bgii;,a-#aa4 ,coverage of certain immunizations recommended by the ,advisory ,committee on ,immunization ,practices 7a7 ,in general ,with respect to plan years occurring during the date of the enactment of this section1 or beginning on or after the date of the enactment of this section and before ,january #a1 #bjcj1 a group health plan and a health insurance issuer offering group or individual health insurance coverage shall provide coverage for and shall not impose any cost sharing requirements for immunizations that had in effect a recommendation from the ,advisory ,committee on ,immunization ,practices of the ,centers for ,disease ,control and ,prevention with respect to the individual involved as of ,october #be1 #bjbd1 including such an immunization as updated or changed after that date under a supplement to a biologics license application approved by the ,food and ,drug ,administration4 7b7 ,special rule ,subsection 7a7 shall not apply in the case of an immunization administered during the minimum interval established under section #bgac7;b7 with respect to such immunization4 4 7,b7 ,conforming amendment ,section #acjb7;e77#a77;,b77i7 of the ,patient ,protection and ,affordable ,care ,act 7#db ,u4,s4,c4 #ahjbb7;e77#a77;,b77i77 is amended by striking section #bgac and inserting sections #bgac and #bgii;,a-#aa of the ,public ,health ,service ,act4 7#b7 ,,erisa 7,a7 ,in general ,subpart ,b of part #g of subtitle ,b of title ,i of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #aahe et seq47 is amended by adding at the end the following new section3 #gbf4 ,coverage of certain immunizations recommended by the ,advisory ,committee on ,immunization ,practices 7a7 ,in general ,with respect to plan years occurring during the date of the enactment of this section1 or beginning on or after the date of the enactment of this section and before ,january #a1 #bjcj1 a group health plan and a health insurance issuer offering group health insurance coverage shall provide coverage for and shall not impose any cost sharing requirements for immunizations that had in effect a recommendation from the ,advisory ,committee on ,immunization ,practices of the ,centers for ,disease ,control and ,prevention with respect to the individual involved as of ,october #be1 #bjbd1 including such an immunization as updated or changed after that date under a supplement to a biologics license application approved by the ,food and ,drug ,administration4 7b7 ,special rule ,subsection 7a7 shall not apply in the case of an immunization administered during the minimum interval established under section #bgac7;b7 of the ,public ,health ,service ,act with respect to such immunization4 4 7,b7 ,clerical amendment ,the table of contents in section #a of the ,employee ,retirement ,income ,security ,act of #aigd 7#bi ,u4,s4,c4 #ajja note7 is amended by inserting after the item relating to section #gbe the following new item3 ,sec4 #gbf4 ,coverage of certain immunizations recommended by the ,advisory ,committee on ,immunization ,practices4 4 7#c7 ,,irc 7,a7 ,in general ,subchapter ,b of chapter #ajj of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new section3 #ihbf4 ,coverage of certain immunizations recommended by the ,advisory ,committee on ,immunization ,practices 7a7 ,in general ,with respect to plan years occurring during the date of the enactment of this section1 or beginning on or after the date of the enactment of this section and before ,january #a1 #bjcj1 a group health plan shall provide coverage for and shall not impose any cost sharing requirements for immunizations that had in effect a recommendation from the ,advisory ,committee on ,immunization ,practices of the ,centers for ,disease ,control and ,prevention with respect to the individual involved as of ,october #be1 #bjbd1 including such an immunization as updated or changed after that date under a supplement to a biologics license application approved by the ,food and ,drug ,administration4 7b7 ,special rule ,subsection 7a7 shall not apply in the case of an immunization administered during the minimum interval established under section #bgac7;b7 of the ,public ,health ,service ,act with respect to such immunization4 4 7,b7 ,clerical amendment ,the table of sections for subchapter ,b of chapter #ajj of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new item3 ,sec4 #ihbf4 ,coverage of certain immunizations recommended by the ,advisory ,committee on ,immunization ,practices4 4 7b7 ,medicare ,section #ahfj;,d-#b7;b77#h77;,b7 of the ,social ,security ,act 7#db ,u4,s4,c4 #aciew-#ajb7;b77#h77;,b77 is amended-- 7#a7 by striking with recommendations and inserting with-- 7i7 recommendations 2 7#b7 by striking the period at the end and inserting 2 or2 and 7#c7 by adding at the end the following new clause3 7ii7 for plan years occurring during the date of the enactment of this clause1 or beginning on or after the date of the enactment of this clause and before ,january #a1 #bjcj1 in the case of a vaccine with respect to which such a recommendation is revoked with respect to the individual involved on or after ,october #be1 #bjbd1 including such a vaccine as updated or changed after that date under a supplement to a biologics license application approved by the ,food and ,drug ,administration1 the most recent recommendation that was in effect with respect to such vaccine and such individual prior to such revocation4 4 7c7 ,medicaid 7#a7 ,in general ,section #aije of the ,social ,security ,act 7#db ,u4,s4,c4 #acif;d7 is amended-- 7,a7 in subsection 7a77#ac77;,b7-- 7i7 by striking individual1 approved and inserting individual-- 7i7 approved 2 and 7ii7 by adding at the end the following new clause3 7ii7 for the period beginning on the date of the enactment of this clause and ending on ,december #ca1 #bjbi1 approved vaccines1 and the administration of such vaccines1 that were recommended by such advisory committee with respect to the individual involved as of ,october #be1 #bjbd1 including such a vaccine as updated or changed after that date under a supplement to a biologics license application approved by the ,food and ,drug ,administration4 2 and 7,b7 in subsection 7r77#a77;,b77iii71 by-- 7i7 striking section #aibh7;c77#b77;,b77i7 and inserting clause 7i7 of section #aibh7;c77#b77;,b72 and 7ii7 inserting 1 subject to the limitation described in clause 7iii7 of such section after pediatric vaccines4 7#b7 ,coverage for pregnant individuals ,section #aijb7;a77#aj7 of the ,social ,security ,act 7#db ,u4,s4,c4 #acif;a7a77#aj77 is amended in the matter following subparagraph 7,g7 by inserting medical assistance for vaccines described in section #aije7;a77#ac77;,b7 and the administration of such vaccines1 after complicate pregnancy14 7#c7 ,program for distribution of pediatric vaccines ,section #aibh of the ,social ,security ,act 7#db ,u4,s4,c4 #acifs7 is amended-- 7,a7 in subsection 7c77#b77;,b7-- 7i7 in clause 7i71 by striking clause 7ii7 and inserting clauses 7ii7 and 7iii72 and 7ii7 by adding at the end the following new clause3 7iii7 ,for the period beginning on the date of the enactment of this clause and ending on ,december #ca1 #bjbi1 the provider will not take into account any change in the schedule described in clause 7i7 that removes the recommendation to administer a pediatric vaccine with respect to the vaccine-eligible child involved if such pediatric vaccine was recommended with respect to such child under such schedule as of ,october #be1 #bjbd1 including with respect to such pediatric vaccine as updated or changed after that date under a supplement to a biologics license application approved by the ,food and ,drug ,administration4 2 and 7,b7 in subsection 7e71 by inserting ,for purposes of the preceding sentence1 during the period beginning on the date of the enactment of this sentence and ending on ,december #ca1 #bjbi1 the ,secretary may not take into account any revision of such list that occurs on or after ,october #be1 #bjbd1 that removes a pediatric vaccine from such list if such vaccine was included in such list as of such date1 including with respect to such vaccine as updated or changed after that date under a supplement to a biologics license application approved by the ,food and ,drug ,administration4 after the period at the end4 7#d7 ,state flexibility in benefit packages ,section #aicg7;b7 of the ,social ,security ,act 7#db ,u4,s4,c4 #acifu-#g7;b77 is amended by adding at the end the following new paragraph3 7#i7 ,coverage of adult vaccines ,notwithstanding the previous provisions of this section1 a ,state may not provide for medical assistance through enrollment of an individual with benchmark coverage or benchmark-equivalent coverage under this section unless such coverage includes 7and does not impose any deduction1 cost sharing1 or similar charge for7 the medical assistance described in section #aije7;a77#ac77;,b74 4 7d7 ,,chip ,section #bajc of the ,social ,security ,act 7#db ,u4,s4,c4 #acig;cc7 is amended-- 7#a7 in subsection 7c71 by adding at the end the following new paragraph3 7#ac7 ,required coverage of certain vaccines recommended by the ,advisory ,committee on ,immunization ,practices ,regardless of the type of coverage elected by a ,state under subsection 7a71 the child health assistance provided for a targeted low-income child shall include coverage1 during the period beginning on the date of the enactment of this paragraph and ending on ,december #ca1 #bjbi1 of vaccines1 and the administration of such vaccines1 that had in effect a recommendation from the ,advisory ,committee on ,immunization ,practices of the ,centers for ,disease ,control and ,prevention with respect to the child involved as of ,october #be1 #bjbd1 including such a vaccine as updated or changed after that date under a supplement to a biologics license application approved by the ,food and ,drug ,administration4 2 and 7#b7 in subsection 7e77#b71 by inserting vaccines described in subsection 7c77#ac7 administered during the period beginning on the date of the enactment of such subsection and ending on ,december #ca1 #bjbi 7and the administration of such vaccines71 before services described in section #aiaf7;a77#b77;,g74