A bill to extend section 167 (k) of the Internal Revenue Code.

Extends the provisions of the Internal Revenue Code authorizing a depreciation deduction for expenditures incurred to rehabilitate low-income rental housing from January 1, 1975, to January 1, 1981. Increases the aggregate amount limitation for such deduction from $15,000 to $20,000. Increases the amount of such expenses that must be incurred in 2 consecutive years by the taxpayer to be eligible for such deduction from $3,000 to $8,000 and provides that such expense must be incurred with respect to at least 20 dwelling units.

Provides that, under specified conditions, the gain from the sale or exchange of low-income rental property that represents additional depreciation due to the provisions allowing accelerated depreciation of rehabilitation expenditures shall be taxable as gain from the sale or exchange of a capital asset.