H.R. 1562 – Reading Mode

IIB

110th CONGRESS

1st Session

H. R. 1562

IN THE SENATE OF THE UNITED STATES

March 28, 2007

Received; read twice and referred to the Committee on Finance

AN ACT

To amend the Internal Revenue Code of 1986 to extend and expand certain rules with respect to housing in the GO Zones.

Short title

This Act may be cited as the Katrina Housing Tax Relief Act of 2007.

Extension and expansion of low-income housing credit rules for buildings in the GO Zones

(a)

Time for making low-income housing credit allocations

Subsection (c) of section 1400N of the Internal Revenue Code of 1986 (relating to low-income housing credit) is amended by redesignating paragraph (5) as paragraph (6) and by inserting after paragraph (4) the following new paragraph:

(5)

Time for making low-income housing credit allocations

Section 42(h)(1)(B) shall not apply to an allocation of housing credit dollar amount to a building located in the Gulf Opportunity Zone, the Rita GO Zone, or the Wilma GO Zone, if such allocation is made in 2006, 2007, or 2008, and such building is placed in service before January 1, 2011.

(b)

Extension of period for treating GO Zones as difficult development areas

(1)

In general

Subparagraph (A) of section 1400N(c)(3) of such Code is amended by striking 2006, 2007, or 2008 and inserting the period beginning on January 1, 2006, and ending on December 31, 2010.

(2)

Conforming amendment

Clause (ii) of section 1400N(c)(3)(B) of such Code is amended by striking such period and inserting the period described in subparagraph (A).

(c)

Community Development Block Grants not taken into account in determining if buildings are federally subsidized

Subsection (c) of section 1400N of such Code (relating to low-income housing credit), as amended by this Act, is amended by redesignating paragraph (6) as paragraph (7) and by inserting after paragraph (5) the following new paragraph:

(6)

Community Development Block Grants not taken into account in determining if buildings are federally subsidized

For purpose of applying section 42(i)(2)(D) to any building which is placed in service in the Gulf Opportunity Zone, the Rita GO Zone, or the Wilma GO Zone during the period beginning on January 1, 2006, and ending on December 31, 2010, a loan shall not be treated as a below market Federal loan solely by reason of any assistance provided under section 106, 107, or 108 of the Housing and Community Development Act of 1974 by reason of section 122 of such Act or any provision of the Department of Defense Appropriations Act, 2006, or the Emergency Supplemental Appropriations Act for Defense, the Global War on Terror, and Hurricane Recovery, 2006.

Special tax-exempt bond financing rule for repairs and reconstructions of residences in the GO Zones

Subsection (a) of section 1400N of the Internal Revenue Code of 1986 (relating to tax-exempt bond financing) is amended by adding at the end the following new paragraph:

(7)

Special rule for repairs and reconstructions

(A)

In general

For purposes of section 143 and this subsection, any qualified GO Zone repair or reconstruction shall be treated as a qualified rehabilitation.

(B)

Qualified GO Zone repair or reconstruction

For purposes of subparagraph (A), the term qualified GO Zone repair or reconstruction means any repair of damage caused by Hurricane Katrina, Hurricane Rita, or Hurricane Wilma to a building located in the Gulf Opportunity Zone, the Rita GO Zone, or the Wilma GO Zone (or reconstruction of such building in the case of damage constituting destruction) if the expenditures for such repair or reconstruction are 25 percent or more of the mortgagor’s adjusted basis in the residence. For purposes of the preceding sentence, the mortgagor’s adjusted basis shall be determined as of the completion of the repair or reconstruction or, if later, the date on which the mortgagor acquires the residence.

(C)

Termination

This paragraph shall apply only to owner-financing provided after the date of the enactment of this paragraph and before January 1, 2011.

GAO study of practices employed by State and local governments in allocating and utilizing tax incentives provided pursuant to the Gulf Opportunity Zone Act of 2005

(a)

In general

The Comptroller General of the United States shall conduct a study of the practices employed by State and local governments, and subdivisions thereof, in allocating and utilizing tax incentives provided pursuant to the Gulf Opportunity Zone Act of 2005 and this Act.

(b)

Submission of report

Not later than one year after the date of the enactment of this Act, the Comptroller General shall submit a report on the findings of the study conducted under subsection (a) and shall include therein recommendations (if any) relating to such findings. The report shall be submitted to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate.

(c)

Congressional hearings

In the case that the report submitted under this section includes findings of significant fraud, waste or abuse, each Committee specified in subsection (b) shall, within 60 days after the date the report is submitted under subsection (b), hold a public hearing to review such findings.

Modification of collection due process procedures for employment tax liabilities

(a)

In general

Section 6330(f) of the Internal Revenue Code of 1986 (relating to jeopardy and State refund collection) is amended—

(1)

by striking ; or at the end of paragraph (1) and inserting a comma,

(2)

by adding or at the end of paragraph (2), and

(3)

by inserting after paragraph (2) the following new paragraph:

(3)

the Secretary has served a disqualified employment tax levy,

(b)

Disqualified employment tax levy

Section 6330 of such Code (relating to notice and opportunity for hearing before levy) is amended by adding at the end the following new subsection:

(h)

Disqualified employment tax levy

For purposes of subsection (f), a disqualified employment tax levy is any levy in connection with the collection of employment taxes for any taxable period if—

(1)

the person subject to the levy (or any predecessor thereof) requested a hearing under this section with respect to unpaid employment taxes arising in the most recent 2-year period before the beginning of the taxable period with respect to which the levy is served, and

(2)

such levy is served before February 29, 2016.

For purposes of the preceding sentence, the term employment taxes means any taxes under chapter 21, 22, 23, or 24.

(c)

Effective date

The amendments made by this section shall apply to levies served on or after the date that is 120 days after the date of the enactment of this Act.

Time for payment of corporate estimated taxes

Subparagraph (B) of section 401(1) of the Tax Increase Prevention and Reconciliation Act of 2005 is amended by striking 106.25 percent and inserting 106.45 percent.

Passed the House of Representatives March 27, 2007.

Lorraine C. Miller,

Clerk.