[Congressional Record Volume 171, Number 112 (Saturday, June 28, 2025)]
[Senate]
[Pages S3990-S3991]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
SA 2448. Mr. MERKLEY submitted an amendment intended to be proposed
by him to the bill H.R. 1, to provide for reconciliation pursuant to
title II of H. Con. Res. 14; which was ordered to lie on the table; as
follows:
At the appropriate place, insert the following:
SEC. ____. HOMEOWNERSHIP PROVISIONS.
(a) Excise Tax on Acquisition of Single-family Residences
by Hedge Fund Taxpayers.--
(1) In general.--Subtitle D is amended by adding at the end
the following new chapter:
``CHAPTER 50B--SINGLE-FAMILY RESIDENCES
``Sec. 5000E. Newly acquired single-family residences.
``SEC. 5000E. NEWLY ACQUIRED SINGLE-FAMILY RESIDENCES.
``(a) In General.--There is hereby imposed the acquisition
of any newly acquired single-family residence by a hedge fund
taxpayer an amount equal to 15 percent of the purchase price
thereof.
``(b) Newly Acquired Single-family Residence.--For purposes
of this section--
``(1) In general.--The term `newly acquired single-family
residence' means any residential property which--
``(A) consists of 1-to-4 dwelling units, and
``(B) was acquired by the taxpayer in any taxable year
which begins after the date of the enactment of this chapter.
``(2) Exception.--A residential property shall not be
treated as a newly acquired single-family residence if,
immediately after acquisition and at all times thereafter,
such property is--
[[Page S3991]]
``(A) not rented or leased, and
``(B) used as the principal residence (within the meaning
of section 121) of any person who has an ownership interest
in the hedge fund taxpayer acquiring such taxpayer.
``(c) Hedge Fund Taxpayer.--For purposes of this chapter--
``(1) In general.--The term `hedge fund taxpayer' means,
with respect to any taxable year, any applicable entity
which--
``(A) manages funds pooled from investors,
``(B) has $50,000,000 or more in net value or assets under
management on any day during the taxable year, and
``(C) is a fiduciary with respect to such investors.
``(2) Applicable entity.--
``(A) In general.--The term `applicable entity' means--
``(i) any partnership,
``(ii) any corporation, or
``(iii) any real estate investment trust.
``(B) Exceptions.--The term `applicable entity' shall not
include--
``(i) an organization which is described in section
501(c)(3) and exempt from tax under section 501(a), or
``(ii) 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 business.
``(3) Aggregation rules.--
``(A) In general.--All persons which are treated as a
single employer under subsections (a) and (b) of section 52
shall be treated as a single person.
``(B) Modifications.--For purposes of this subsection--
``(i) section 52(a) shall be applied by substituting
`component members' for `members', and
``(ii) for purposes of applying section 52(b), the term
`trade or business' shall include any activity treated as a
trade or business under paragraph (5) or (6) of section
469(c) (determined without regard to the phrase `To the
extent provided in regulations' in such paragraph (6)).
``(C) Component member.--For purposes of this paragraph,
the term `component member' has the meaning given such term
by section 1563(b), except that the determination shall be
made without regard to section 1563(b)(2).
``(d) Other Definitions and Rules.--For purposes of this
section--
``(1) Purchase price.--The term `purchase price' means the
adjusted basis of the newly acquired single-family residence
on the date such residence is purchased.
``(2) Acquisition.--A hedge fund taxpayer shall be treated
as acquiring a single-family residence if the taxpayer
acquires a majority ownership interest in the single-family
residence, regardless of the percentage of that ownership
interest.''.
(2) Clerical amendment.--The table of chapters for subtitle
D is amended by adding at the end the following new item:
``Chapter 50B--Excess Single-family Residences''.
(3) Effective date.--The amendments made by this subsection
shall apply to taxable years beginning after the date of
enactment of this Act.
(b) Corporate Surtax on Hedge Fund Taxpayers.--
(1) In general.--Section 11 is amended by adding at the end
the following new subsection:
``(e) Hedge Fund Taxpayers.--In the case of a corporation
which is described in section 5000E(c), the percentage under
subsection (b) shall be increased by 5 percentage points.''.
(2) Effective date.--The amendment made by this subsection
shall apply to taxable years beginning after December 31,
2035.
(c) Disallowance of Certain Deductions Taken in Connection
With Single-family Residences of Hedge Fund Taxpayers.--
(1) Mortgage interest.--
(A) In general.--Section 163 is amended by redesignating
subsection (n) as subsection (o) and by inserting after
subsection (m) the following new subsection:
``(n) No Deduction for Interest on Acquisition Indebtedness
of Single-family Residences of Certain Taxpayers.--
``(1) In general.--In the case of a hedge fund taxpayer, no
deduction shall be allowed under this chapter with respect to
interest paid or accrued on acquisition indebtedness with
respect to any single family residence.
``(2) Definitions.--For purposes of this subsection--
``(A) Hedge fund taxpayer.--The term `hedge fund taxpayer'
means, for any taxable year, any taxpayer--
``(i) who is described in section 5000E(c), and
``(ii) who is in the trade or business of renting or
leasing single-family residences.
``(B) Acquisition indebtedness.--The term `acquisition
indebtedness' has the meaning given such term under
subsection (h)(3)(B), determined--
``(i) by substituting `single-family residence (as defined
in subsection (n))' for `qualified residence', and
``(ii) without regard to clause (ii) thereof.
``(C) Single-family residence.--The term `single-family
residence' means any residential property which consists of
1-to-4 dwelling units''.
(B) Effective date.--The amendments made by this paragraph
shall apply to taxable years beginning after December 31,
2030.
(2) Depreciation.--
(A) In general.--Section 167 is amended by redesignating
subsection (i) as subsection (j) and by inserting after
subsection (h) the following new subsection:
``(i) Deduction Disallowed for Single-family Residences of
Certain Taxpayers.--
``(1) In general.--In the case of a hedge fund taxpayer, no
deduction shall be allowed under this section for any single
family residence.
``(2) Definitions.--For purposes of this subsection--
``(A) Hedge fund taxpayer.--The term `hedge fund taxpayer'
means, for any taxable year, any taxpayer--
``(i) who is described in section 5000E(c), and
``(ii) who is in the trade or business of renting or
leasing single-family residences.
``(B) Single-family residence.--The term `single-family
residence' means any residential property which consists of
1-to-4 dwelling units.''.
(B) Effective date.--The amendments made by this paragraph
shall apply to taxable years beginning after December 31,
2030.
(3) Qualified business income.--
(A) In general.--Section 199A(d) is amended by striking
``or'' at the end of subparagraph (A), by striking the period
at the end of subparagraph (B) and inserting ``, or'', and by
adding at the end the following new subparagraph:
``(C) any trade or business of hedge fund taxpayer (as
defined in section 163(n)(2)(A)).''.
(B) Effective date.--The amendments made by this paragraph
shall apply to taxable years beginning after December 31,
2035.
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