[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1481 Introduced in House (IH)]

112th CONGRESS
  1st Session
                                H. R. 1481

To amend the Internal Revenue Code of 1986 to encourage the purchase of 
  residential property by providing an exclusion from tax on certain 
                                 gains.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             April 12, 2011

  Mr. Polis (for himself and Mr. Coffman of Colorado) introduced the 
 following bill; which was referred to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to encourage the purchase of 
  residential property by providing an exclusion from tax on certain 
                                 gains.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Investment Property Opportunity Act 
of 2011''.

SEC. 2. EXCLUSION OF CERTAIN CAPITAL GAINS ON RESIDENTIAL PROPERTY.

    (a) In General.--Part III of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 is amended by inserting after section 
139C the following new section:

``SEC. 139D. CAPITAL GAINS ON CERTAIN RESIDENTIAL PROPERTY.

    ``(a) In General.--Gross income shall not include gain from the 
sale of real property consisting predominantly of residential property 
if--
            ``(1) such property is located in a distressed housing 
        area,
            ``(2) such property is acquired by purchase (as defined in 
        section 179(d)(2)) during the 18-month period beginning on the 
        date of the enactment of this section, and
            ``(3) such property is held for more than 3 years.
    ``(b) Distressed Housing Area.--For purposes of this section, the 
term `distressed housing area' means any county which is designated by 
the Secretary as having, with respect to residential housing located in 
such county--
            ``(1) a mortgage foreclosure rate during 2010 which was 110 
        percent or more of the national average of such rate,
            ``(2) a decline during 2010 in the average fair market 
        value of such housing of at least 20 percent, or
            ``(3) more than 50 percent of the loans which are secured 
        by such housing as having a loan to value ratio of greater than 
        80 percent (determined as of the end of 2010).
    ``(c) Exception for Sales Between Related Persons.--
            ``(1) In general.--Subsection (a) shall not apply to any 
        sale between related persons.
            ``(2) Related persons.--For purposes of this subsection, a 
        person shall be treated as related to another person if the 
        relationship between such persons would result in a 
        disallowance of losses under section 267 or 707(b).''.
    (b) Clerical Amendment.--The table of sections for part III of 
subchapter B of chapter 1 of such Code is amended by inserting after 
the item relating to section 139C the following new item:

``Sec. 139D. Capital gains on certain residential property.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property purchased after the date of the enactment of this 
section.
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