Reconnecting Youth to Prevent Homelessness Act of 2007

Reconnecting Youth to Prevent Homelessness Act of 2007 - Amends part E (Foster Care and Adoption Assistance) of title IV of the Social Security Act to require State part E plans to provide that the state shall have in effect such laws and procedures as are necessary to ensure that: (1) a child may not be placed in foster care under state responsibility solely because the family with which the child is living is homeless or living in substandard housing; and (2) the state will work with the family and state housing authorities to secure permanent housing for any family that includes a minor child and is homeless or at risk of becoming homeless.

Requires the Comptroller General to report to appropriate congressional committees on state policies and practices regarding: (1) access to federally funded child welfare services by children who have attained age 13; and (2) consideration of runaway and homeless situations as risk assessment factors for determining the appropriateness of placement in the child welfare system.

Requires state part E plans to describe state policies and procedures regarding runaway or missing foster children.

Provides for extension of child welfare services to emancipated youth between ages 18 and 21.

Revises the John H. Chafee Foster Care Independence Program.

Amends part A (Temporary Assistance for Needy Families) (TANF) to revise the requirement that the state provide adult-supervised living arrangements for teenage parents not yet living in such an arrangement.

Suspends the five-year time limit on TANF assistance for parents under age 21 who are involved in education or training.

Prohibits the imposition of sanctions under TANF with respect to minor parents unless the state has established procedures that help TANF recipients understand, avoid, or end sanctions, and has applied the procedures to the recipient.

Requires the Secretary to study and report to Congress on: (1) TANF recipients who are parents and have not attained age 20; and (2) a representative sample of low-income teen parents who are not TANF recipients.

Amends the Internal Revenue Code to include homeless youth as a qualified targeted population for the work opportunity business income tax credit.