,,ii #aaith ,,congress #ast ,session ,s4 #ghh ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,february #bg1 #bjbe ,mr4 ,merkley 7for himself1 ,mr4 ,king1 ,mr4 ,van ,hollen1 ,mr4 ,gallego1 ,mr4 ,sanders1 and ,mr4 ,kelly7 introduced the following bill2 which was read twice and referred to the ,committee on ,finance ,a ,,bill ,to amend the ,internal ,revenue ,code of #aihf to impose an excise tax on the failure of certain hedge funds owning excess single-family residences to dispose of such residences1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,,hope 7,humans over ,private ,equity7 for ,homeownership ,act4 #b4 ,excise tax on certain taxpayers failing to sell excess single-family residences 7a7 ,in general ,subtitle ,d of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new chapter3 #ej;,b ,excess single-family residences ,sec4 #ejjj;,e4 ,newly acquired single-family residences4 ,sec4 #ejjj;,f4 ,excess single-family residences4 ,sec4 #ejjj;,g4 ,definitions and other special rules4 #ejjj;,e4 ,newly acquired single-family residences 7a7 ,in general ,in the case of a hedge fund taxpayer1 there is hereby imposed a tax on the acquisition of any newly acquired single-family residence equal to the greater of-- 7#a7 #ae percent of the purchase price1 or 7#b7 #aj1jjj4 7b7 ,newly acquired single-,family residence ,for purposes of this section1 the term newly acquired single-family residence means any single-family residence which was acquired by the taxpayer in any taxable year which begins after the date of the enactment of this chapter4 7c7 ,purchase price ,for purposes of this section1 the term purchase price means the adjusted basis of the newly acquired single-family residence on the date such residence is purchased4 #ejjj;,f4 ,excess single-family residences 7a7 ,in general ,in the case of an applicable taxpayer who fails to meet the requirements of subsection 7b71 there is hereby imposed a tax equal to the product of-- 7#a7 #e1jjj1 and 7#b7 the excess of-- 7,a7 the number of applicable single-family residences owned by the taxpayer as of the last day of the taxable year1 over 7,b7 the maximum permissible units for the taxable year4 7b7 ,requirement 7#a7 ,in general ,an applicable taxpayer meets the requirement of this subsection for any taxable year if the number of applicable single-family residences owned by the taxpayer as of the last day of the taxable year is equal to or less than the maximum permissible units determined with respect to such taxpayer for such taxable year4 7#b7 ,special rule for certain sales ,for purposes of applying paragraph 7#a71 a single-family residence which is sold or transferred in a disqualified sale during the taxable year shall be treated as a single-family residence which is owned by the applicable taxpayer as of the last day of such taxable year4 7c7 ,maximum permissible units ,the maximum permissible units with respect to any applicable taxpayer for any taxable year shall be determined as follows3 ,in the case of--,the maximum permissible units for a hedge fund taxpayer is--,the maximum permissible units for any other applicable taxpayer is-- the first full taxable year beginning after the applicable date 4 4 4#ij percent of the number of applicable single-family residences owned by the taxpayer on the applicable date#ej plus #ij percent of the number of applicable single-family residences owned by the taxpayer on the applicable date the second taxable year beginning after the applicable date 4 4 4#hj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date#ej plus #hj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date the third taxable year beginning after the applicable date 4 4 4#gj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date#ej plus #gj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date the fourth taxable year beginning after the applicable date 4 4 4#fj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date#ej plus #fj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date the fifth taxable year beginning after the applicable date 4 4 4#ej percent of the number of applicable single-family residences owned by the taxpayer on the applicable date#ej plus #ej percent of the number of applicable single-family residences owned by the taxpayer on the applicable date the sixth taxable year beginning after the applicable date 4 4 4#dj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date#ej plus #dj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date the seventh taxable year beginning after the applicable date 4 4 4#cj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date#ej plus #cj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date the eighth taxable year beginning after the applicable date 4 4 4#bj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date#ej plus #bj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date the ninth taxable year beginning after the applicable date 4 4 4#aj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date#ej plus #aj percent of the number of applicable single-family residences owned by the taxpayer on the applicable date any taxable year beginning more than #i years after the applicable date 4 4 4#j #ej4 7d7 ,definitions ,for purposes of this section-- 7#a7 ,applicable single-family residence ,the term applicable single-family residence means any single-family residence which was acquired on or before the applicable date4 7#b7 ,applicable date 7,a7 ,in general ,the term applicable date means-- 7i7 the last day of the first full taxable year ending on or after the date of the enactment of this chapter1 or 7ii7 in the case of any taxpayer described in subparagraph 7,b71 the date provided in such subparagraph4 7,b7 ,taxpayers changing status 7i7 ,in general ,in the case of any applicable taxpayer described in clause 7ii71 the applicable date means the last day of the taxable year immediately preceding the taxable year in which the taxpayer is described in such clause4 7ii7 ,applicable taxpayer described ,an applicable taxpayer is described in this clause with respect to any taxable year if-- 7,i7 such taxpayer was not a hedge fund taxpayer for the preceding taxable year1 and 7,,ii7 such taxpayer is a hedge fund taxpayer for such taxable year4 7#c7 ,disqualified sale ,the term disqualified sale means any sale or transfer to-- 7,a7 a corporation or other entity engaged in a trade or business1 or 7,b7 an individual who owns any other single-family residence at the time of such sale or transfer4 #ejjj;,g4 ,definitions and other special rules 7a7 ,applicable taxpayer ,for purposes of this chapter-- 7#a7 ,in general ,the term applicable taxpayer means any applicable entity which-- 7,a7 manages funds pooled from investors1 and 7,b7 is a fiduciary with respect to such investors4 7#b7 ,applicable entity 7,a7 ,in general ,the term applicable entity means-- 7i7 any partnership1 7ii7 any corporation1 or 7iii7 any real estate investment trust4 7,b7 ,exceptions ,the term applicable entity shall not include-- 7i7 an organization which is described in section #eja7;c77#c7 and exempt from tax under section #eja7;a71 or 7ii7 an organization which is primarily engaged in the construction or rehabilitation of single-family residences and which offers such residences for sale in the ordinary course of business4 7b7 ,hedge fund taxpayer ,for purposes of this section1 the term hedge fund taxpayer means1 with respect to any taxable year1 any applicable taxpayer which has #ej1jjj1jjj or more in net value or assets under management on any day during the taxable year4 7c7 ,single-,family residence ,for purposes of this chapter-- 7#a7 ,in general ,the term single-family residence means a residential property consisting of #a- to #d dwelling units4 7#b7 ,exceptions ,a residential property shall not be treated as a residential property described in clause 7i7 if-- 7,a7 such property is unoccupied and acquired through foreclosure 7other than such a residence acquired through foreclosure by a hedge fund taxpayer1 as defined in section #ejjj;,f7d77#c771 7,b7 such property is-- 7i7 not rented or leased1 and 7ii7 used as the principal residence 7within the meaning of section #aba7 of any person who has an ownership interest in the applicable taxpayer1 or 7,c7 such property-- 7i7 was a building with respect to which a credit was allowed under section #db 7relating to the low-income housing credit71 and 7ii7 is not owned by a hedge fund taxpayer 7as defined in section #ejjj;,f7d77#c774 7d7 ,acquisition2 ownership ,for purposes of this chapter1 an applicable taxpayer shall be treated-- 7#a7 as acquiring a single-family residence if the applicable taxpayer acquires a majority ownership interest in the single-family residence1 regardless of the percentage of that ownership interest1 and 7#b7 as owning a single-family residence if the applicable taxpayer owns a majority ownership interest in the single-family residence1 regardless of the percentage of that ownership interest4 7e7 ,aggregation rules 7#a7 ,in general ,for purposes of this chapter1 all persons which are treated as a single employer under subsections 7a7 and 7b7 of section #eb shall be treated as a single person4 7#b7 ,modifications ,for purposes of this subsection-- 7,a7 section #eb7;a7 shall be applied by substituting component members for members1 and 7,b7 for purposes of applying section #eb7;b71 the term trade or business shall include any activity treated as a trade or business under paragraph 7#e7 or 7#f7 of section #dfi7;c7 7determined without regard to the phrase ,to the extent provided in regulations in such paragraph 7#f774 7#c7 ,component member ,for purposes of this paragraph1 the term component member has the meaning given such term by section #aefc7;b71 except that the determination shall be made without regard to section #aefc7;b77#b74 4 7b7 ,clerical amendment ,the table of chapters for subtitle ,d of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new item3 ,chapter #ej;,b--,excess single-family residences 4 7c7 ,effective date ,the amendments made by this section shall apply to taxable years beginning after the date of enactment of this ,act4 #c4 ,disallowance of mortgage interest and depreciation in connection with single-family residences owned by covered taxpayers 7a7 ,mortgage interest 7#a7 ,in general ,section #afc 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 ,certain interest paid by covered taxpayers 7#a7 ,in general ,no deduction shall be allowed under this chapter for a taxable year with respect to interest paid or accrued on acquisition indebtedness with respect to any single-family residence if the owner of such single-family residence is liable for tax under chapter #ej;,b for such taxable year4 7#b7 ,definitions ,for purposes of this subsection-- 7,a7 ,acquisition indebtedness ,the term acquisition indebtedness has the meaning given such term under subsection 7h77#c77;,b71 determined-- 7i7 by substituting single-family residence 7as defined in section #ejjj;,g7b77 for qualified residence1 and 7ii7 without regard to clause 7ii7 thereof4 7,b7 ,single-family residence ,the term single-family residence has the meaning given such term under section #ejjj;,g7b74 7,c7 ,ownership ,the rules of section #ejjj;,g7c7 shall apply for purposes of determining ownership4 4 7#b7 ,effective date ,the amendments made by this subsection shall apply to taxable years beginning after the date of the enactment of this ,act4 7b7 ,depreciation 7#a7 ,in general ,section #afg of the ,internal ,revenue ,code of #aihf is amended by redesignating subsection 7i7 as subsection 7j7 and by inserting after subsection 7h7 the following new subsection3 7i7 ,deduction disallowed for disqualified single family property owners 7#a7 ,in general ,no deduction shall be allowed under this section for a taxable year with respect to a single-family residence if the owner of such single-family residence is liable for tax under chapter #ej;,b for such taxable year4 7#b7 ,definitions ,for purposes of this subsection-- 7,a7 ,single-family residence ,the term single-family residence has the meaning given such term under section #ejjj;,g7b74 7,b7 ,ownership ,the rules of section #ejjj;,g7c7 shall apply for purposes of determining ownership4 4 7#b7 ,effective date ,the amendments made by this subsection shall apply to taxable years beginning after the date of the enactment of this ,act4