Home Modification Credit for Seniors

(a)

In general

Subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to refundable credits) is amended by inserting after section 36B the following:

36C.

Home modification credit for seniors

(a)

Allowance of Credit

In the case of a qualified individual, there shall be allowed as a credit against the tax imposed by this subtitle for the taxable year an amount equal to the aggregate qualified expenditures made by the taxpayer with respect to a qualified residence during such year.(b)

Limitations

(1)

Limitation based on adjusted gross income

(A)

In general

The amount of the credit allowable under subsection (a) shall be reduced (but not below zero) by $1 for each $2 (or fraction thereof) by which the taxpayer’s modified adjusted gross income exceeds the threshold amount.(B)

Threshold amount

For purposes of subparagraph (A), the term threshold amount means—(i)$150,000 in the case of a joint return, and(ii)$100,000 in any other case.(C)

Modified adjusted gross income

For purposes of this paragraph, the term modified adjusted gross income means adjusted gross income—(i)increased by any amount excluded from gross income under section 911, 931, or 933, and(ii)reduced by any amount of social security benefits (as defined in section 86(d)) which is included in gross income under section 86 for the taxable year.(D)

Marital status

For purposes of this paragraph, marital status shall be determined under section 7703.(2)

Lifetime credit limitation

The amount allowed as a credit under subsection (a) (determined after the application of paragraph (1)) with respect to the taxpayer for any taxable year shall not exceed the excess (if any) of—(A)$30,000, over(B)the aggregate amount allowed as a credit under subsection (a) to such taxpayer for all prior taxable years.(c)

Definitions

For purposes of this section—(1)

Qualified individual

The term qualified individual means an individual who has attained 60 years of age.(2)

Qualified expenditure

The term qualified expenditure means an expenditure for any of the following modifications installed on a qualified residence:(A)The installation of entrance and exit ramps.(B)The widening of doorways.(C)The installation of handrails or grab bars.(D)The installation of non-slip flooring.(E)A modification that is included in a list established and maintained in accordance with subsection (d)(2).(3)

Qualified residence

The term qualified residence has the meaning given that term in section 163(h)(4)(A).(d)

Special Rules

(1)

Labor costs

Expenditures for labor costs properly allocable to the onsite preparation, assembly, or original installation of a modification described under subsection (c)(2) and for piping or wiring to interconnect such modification to the dwelling unit shall be taken into account for purposes of this section.(2)

List of modifications

The Secretary, in consultation with the Secretary of Health and Human Services and after receiving the input of members of the public (including seniors groups, health organizations, and social services organizations), shall establish and maintain a list of any modification that, if installed on a residence of a qualified individual, would enhance the ability of such individual to remain living safely, independently, and comfortably in such residence.(3)

When expenditure made

(A)

In general

Except as provided in subparagraph (B), a qualified expenditure shall be treated as made when the original installation of the modification is completed.(B)

Expenditures as part of building construction

In the case of a qualified expenditure in connection with the construction or reconstruction of a structure, such expenditure shall be treated as made when the original use of the constructed or reconstructed structure by the taxpayer begins.(e)

Basis Adjustments

For purposes of this subtitle, if a credit is allowed under this section for any expenditure with respect to any property, the increase in the basis of such property which would (but for this subsection) result from such expenditure shall be reduced by the amount of the credit so allowed.(f)

Credit may be assigned

(1)

In general

If the taxpayer elects the application of this subsection for any taxable year, any portion of the credit determined under this section (after the application of subsection (b)) for such year which would (but for this subsection) be allowable to the taxpayer may be assigned to any person who is an eligible designee. The person so designated shall be allowed the amount of the credit so assigned and shall be treated as the taxpayer with respect to such credit for purposes of this title (other than this paragraph), except that such credit shall be treated as a credit listed in section 38(b) for such taxable year (and not allowed under subsection (a)).(2)

Eligible designee

For purposes of paragraph (1), the term eligible designee means any person who—(A)with respect to the qualified residence, makes any modification described in subsection (c)(2) with respect to which the credit allowable under subsection (a) is attributable,(B)is licensed by the local governmental jurisdiction in which the qualified residence is located to make the modification or installation, and(C)is credentialed in aging home modification by an entity approved by the Secretary of Health and Human Services pursuant to section 2(b) of the Senior Accessible Housing Act.(3)

Election requirements

Any election under paragraph (1) shall include such information and shall be made at such time, and in such form and manner, as the Secretary shall by regulation prescribe.

(b)

Certification requirements

For purposes of section 36C(f)(2)(C) of the Internal Revenue Code of 1986, the Secretary of Health and Human Services may approve a third-part entity to certify persons qualified in the area of accessible home modifications and independent living. In determining whether to approve a person, the Secretary shall ensure that certifications cover home modification solutions for aging at home, local and State building regulations, construction standards, and appropriateness of modifications.(c)

Conforming amendments

(1)Section 38(b) of such Code is amended by striking plus at the end of paragraph (32), by striking the period at the end of paragraph (33) and inserting , plus, and by adding at the end the following new paragraph:

(34)the portion of the home modification credit for seniors assigned to the taxpayer under section 36C(f).

(2)Section 1016(a) of such Code is amended by striking and at the end of paragraph (37), by striking the period at the end of paragraph (38) and inserting ; and, and by inserting after paragraph (38) the following:

(39)to the extent provided in section 36C(e), in the case of amounts with respect to which a credit has been allowed under section 36E.

(3)Paragraph (2) of section 1324(b) of title 31, United States Code, is amended by inserting 36C, after 36B,.(d)

Clerical amendment

The table of sections for subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 36B the following new item:

Sec. 36C. Home modification credit for seniors.

(e)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2020.