117 HR 2077 IH: Taxi Medallion Loan Forgiveness Debt Relief Act of 2021 U.S. House of Representatives 2021-03-19 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

I117th CONGRESS1st SessionH. R. 2077IN THE HOUSE OF REPRESENTATIVESMarch 19, 2021Mr. Meeks (for himself, Mrs. Carolyn B. Maloney of New York, Mr. Suozzi, Ms. Velázquez, Miss Rice of New York, Mr. Espaillat, Ms. Ocasio-Cortez, Mr. Nadler, Mr. Torres of New York, Ms. Clarke of New York, Ms. Meng, Mr. Jeffries, Ms. Malliotakis, and Mr. Bowman) introduced the following bill; which was referred to the Committee on Ways and MeansA BILLTo amend the Internal Revenue Code of 1986 to exclude discharges of indebtedness on taxi medallions from gross income.

1.

Short title

This Act may be cited as the Taxi Medallion Loan Forgiveness Debt Relief Act of 2021.

2.

Exclusion of discharges of qualified taxi medallion indebtedness

(a)

In general

Section 108(a)(1) of the Internal Revenue Code of 1986 is amended by striking or at the end of subparagraph (D), by striking the period at the end of subparagraph (E) and inserting , or, and by inserting after subparagraph (E) the following new subparagraph: (F)in the case of a taxpayer other than a C corporation, the indebtedness discharged is qualified taxi medallion indebtedness which is discharged before January 1, 2023.. (b)

Special rules relating to qualified taxi medallion indebtedness

Section 108 of such Code is amended by adding at the end the following new subsection: (j)

Special rules relating to qualified taxi medallion indebtedness

(1)

Basis reduction

The amount excluded from gross income by reason of subsection (a)(1)(E) shall be applied to reduce (but not below zero) the basis of the taxi medallions of the taxpayer that secure the discharged indebtedness. (2)

Qualified taxi medallion indebtedness

For purposes of this section— (A)

In general

The term qualified taxi medallion indebtedness means indebtedness which— (i)is secured by a taxi medallion, and (ii)with respect to which such taxpayer makes an election to have this paragraph apply. (B)

Limitation

With respect to a taxpayer, the aggregate amount treated as qualified taxi medallion indebtedness for any period shall not exceed $2,000,000 ($1,000,000 in the case of a married individual filing a separate return). (C)

Exception for certain discharges not related to taxpayer's financial condition

Subsection (a)(1)(F) shall not apply to the discharge of a loan if the discharge is on account of services performed for the lender or any other factor not directly related to a decline in the value of the taxi medallion or to the financial condition of the taxpayer. (D)

Ordering rule

If any loan is discharged, in whole or in part, and only a portion of such loan is qualified taxi medallion indebtedness, subsection (a)(1)(F) shall apply only to so much of the amount discharged as exceeds the amount of the loan (as determined immediately before such discharge) which is not qualified taxi medallion indebtedness.. (c)

Conforming amendments

(1)Section 108(a)(2) of such Code is amended by adding at the end the following new subparagraph: (D)

Taxi medallion exclusion takes precedence over insolvency exclusion unless elected otherwise

Paragraph (1)(B) shall not apply to a discharge to which paragraph (1)(F) applies unless the taxpayer elects to apply paragraph (1)(B) in lieu of paragraph (1)(F).. (d)

Effective date

The amendments made by this section shall apply to discharges of indebtedness after December 31, 2016.