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[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 3754 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
2d Session
S. 3754
To amend the Internal Revenue Code of 1986 to impose a tax on the
purchase of single-family homes by certain large investors, and for
other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
January 30, 2026
Mr. Reed (for himself, Ms. Smith, Mr. Blumenthal, Ms. Klobuchar, Ms.
Baldwin, Mr. Whitehouse, Mr. Kim, Mr. Gallego, Mr. Murphy, and Ms.
Slotkin) introduced the following bill; which was read twice and
referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to impose a tax on the
purchase of single-family homes by certain large investors, and for
other purposes.
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 ``Affordable Housing and Homeownership
Protection Act of 2026''.
SEC. 2. TAX ON CERTAIN INVESTOR PURCHASES OF SINGLE-FAMILY HOMES.
(a) In General.--Chapter 36 of the Internal Revenue Code of 1986 is
amended by adding at the end the following new subchapter:
``Subchapter G--Certain Home Purchases
``SEC. 4499. TAX ON CERTAIN INVESTOR PURCHASES OF SINGLE-FAMILY HOMES.
``(a) In General.--There is hereby imposed on each covered investor
a tax equal to the applicable percentage of the purchase price paid by
such covered investor with respect to any covered home purchase during
the taxable year.
``(b) Applicable Percentage.--For purposes of subsection (a), the
applicable percentage is--
``(1) 1 percent in the case of a medium-sized investor,
``(2) 3 percent in the case of a large investor, and
``(3) 5 percent in the case of a giant investor.
``(c) Covered Investor.--For purposes of this section--
``(1) In general.--The term `covered investor' means any
person, other than a person described in paragraph (6), who is
a medium-sized investor, large investor, or giant investor.
``(2) Medium-sized investor.--The term `medium-sized
investor' means any person who owns more than 15 and not more
than 25 single-family homes as of the last day of the taxable
year.
``(3) Large investor.--The term `large investor' means any
person who owns more than 25 and not more than 100 single-
family homes as of the last day of the taxable year.
``(4) Giant investor.--The term `giant investor' means any
person who owns more than 100 single-family homes as of the
last day of the taxable year.
``(5) New construction excluded.--Any new single-family
home which is constructed by the taxpayer shall not be taken
into account for purposes of this subsection, unless such
single-family home replaces a previous single-family home on
the same site which was purchased by the taxpayer and replaced
with the newly constructed single-family home.
``(6) Exceptions.--A person described in this paragraph
is--
``(A) any organization which is exempt from
taxation under section 501(a), the primary purpose of
which is related to affordable housing, housing
counseling, or neighborhood stabilization,
``(B) any State or political subdivision thereof,
``(C) any public housing authority or its
instrumentalities,
``(D) any land bank, or
``(E) any community land trust.
``(d) Terms Relating to Home Purchase, etc.--For purposes of this
section--
``(1) Covered home purchase.--
``(A) In general.--The term `covered home purchase'
means the purchase of a single-family home by a covered
investor.
``(B) New construction.--The construction of a new
single-family home by the taxpayer shall not be treated
as a purchase, unless such new single-family home is
taken into account for purposes of subsection (c) by
reason of paragraph (5) thereof.
``(2) Purchase price.--The term `purchase price' means the
total amount paid, including the amount of any indebtedness
incurred or assumed, by the taxpayer to acquire a single-family
home from the seller.
``(3) Single-family home.--The term `single-family home'
has the meaning given such term by section 81.2 of title 24,
Code of Federal Regulations.
``(4) Own.--The term `own' means directly or indirectly
possessing a majority interest in a single-family home.
``(e) Aggregation Rules.--
``(1) In general.--Except as otherwise provided in
paragraph (2), all persons treated as a single employer under
subsection (a) or (b) of section 52, or subsection (m) or (o)
of section 414, shall be treated as 1 person for purposes of
this section.
``(2) Modifications.--For purposes of this subsection--
``(A) section 52(a) shall be applied by
substituting `component members' for `members', and
``(B) 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)).
``(3) Component member.--For purposes of paragraph (2), the
term `component member' has the meaning given such term by
section 1563(b), determined without regard to paragraph (2)
thereof.
``(4) Acquisition of homes by related parties.--
``(A) In general.--For purposes of determining the
number of homes owned or purchased by a covered
investor, a covered home purchase by a person bearing a
relationship to the covered investor specified in
section 267(b) or 707(b)(1), from a person who does not
bear such a relationship to the covered investor, shall
be treated as a covered home purchase by the covered
investor.
``(B) Members of family.--For purposes of this
paragraph, sections 267(b) and 707(b)(1) shall be
applied as if section 267(c)(4) provided that the
family of an individual consists of the individual's
spouse, the individual's children, grandchildren, and
parents, and any spouse of the individual's children or
grandchildren.
``(C) Exception.--This paragraph shall not apply to
the purchase or ownership by any individual of a home
which is the principal residence (within the meaning of
section 121) of the individual.
``(f) Reporting.--Each person who is a covered investor for the
taxable year shall attach to the return of the tax imposed by this
section a report containing information, in such form as the Secretary
shall prescribe, on--
``(1) the number of single-family homes owned on the last
day of the taxable year by such person, and
``(2) the number of single-family homes purchased by such
person during the taxable year.''.
(b) Clerical Amendment.--The table of subchapters for chapter 36 of
the Internal Revenue Code of 1986 is amended by adding at the end the
following new item:
``subchapter g--certain home purchases''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2025.
SEC. 3. REVENUES.
The Secretary of the Treasury shall allocate or otherwise transfer
such revenues resulting from the tax imposed by section 4499 of the
Internal Revenue Code of 1986 as follows:
(1) 65 percent of such amounts to the Secretary of Housing
and Urban Development to provide additional funding for the
Housing Trust Fund established under section 1338(a) of the
Federal Housing Enterprises Financial Safety and Soundness Act
of 1992 (12 U.S.C. 4568(a)).
(2) 35 percent of such amounts to provide additional
funding for the Capital Magnet Fund established under section
1339(a) of the Federal Housing Enterprises Financial Safety and
Soundness Act of 1992 (12 U.S.C. 4569(a)).
SEC. 4. HOUSING TRUST FUND SMALL STATE MINIMUM.
Section 1338(c)(4)(C) of the Federal Housing Enterprises Financial
Safety and Soundness Act of 1992 (12 U.S.C. 4568(c)(4)(C)) is amended
by striking ``$3,000,000'' each place that term appears and inserting
``1.1 percent of amounts made available under this subsection in a
fiscal year''.
<all>
Introduced in Senate
Read twice and referred to the Committee on Finance. (Sponsor introductory remarks on measure: CR S420-421)
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