H.R. 4109

Low Income Housing Tax Credit Act of 2009

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I

111th CONGRESS

1st Session

H. R. 4109

IN THE HOUSE OF REPRESENTATIVES

November 18, 2009

Mr. Pascrell introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to allow the low income housing credit to be carried back 5 years, and for other purposes.

1.

Short title

This Act may be cited as the Low Income Housing Tax Credit Act of 2009.

2.

Allowing low income housing credits to offset 100 percent of federal income tax liability

(a)

In General

Subsection (c) of section 38 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

(6)

Allowing low income housing credit to offset 100 percent of federal income tax liability

(A)

In general

In the case of applicable low income housing credits—

(i)

this section shall be applied separately with respect to such credits,

(ii)

in applying paragraph (1) to such credits—

(I)

the tentative minimum tax shall be treated as being zero, and

(II)

the limitation under paragraph (1) (as modified by subclause (I)) shall be the net income tax (as defined in paragraph (1)) reduced by the credit allowed under subsection (a) for the taxable year (other than the applicable low income housing credits), and

(iii)

the excess credit for such taxable year shall, solely for purposes of determining the amount of such excess credit which may be carried back to a preceding taxable year, be increased by the amount of business credit carryforwards which are carried to such taxable year, to which this subparagraph applies, and which are not allowed for such taxable year by reason of the limitation under paragraph (1) (as modified by clause (ii)).

(B)

Increase in limitation for taxable years to which excess applicable low income housing credits are carried back

(i)

In general

Solely for purposes of determining the portion of any excess credit described in subparagraph (A)(iii) for which credit will be allowed under subsection (a)(3) for any preceding taxable year, the limitation under paragraph (1) for such preceding taxable year shall be determined under rules similar to the rules described in subparagraph (A).

(ii)

Ordering rule

If the excess credit described in subparagraph (A)(iii) includes business credit carryforwards from preceding taxable years, such excess credit shall be treated as allowed for any preceding taxable year on a first-in first-out basis.

(C)

Applicable low income housing credits

For purposes of this subpart, the term applicable low income housing credits means the credit determined under section 42—

(i)

to the extent attributable to buildings placed in service after the date of the enactment of this subparagraph, and

(ii)

in the case of any other buildings, for taxable years beginning in 2008, 2009, and 2010 (and to business credit carryforwards with respect to such buildings carried to such taxable years) to the extent provided in subparagraph (D).

(D)

Previously placed in service buildings

(i)

In general

Subparagraph (C)(ii) shall apply to such credits for such a taxable year only—

(I)

if the taxpayer and the housing credit agency have entered into an agreement, not later than the applicable date, with respect to an investment in a future project (which is binding on such agency, the taxpayer, and all successors in interest) which specifies the dollar amount of such investment and the housing credit dollar amount to be allocated to such project, and

(II)

to the extent such credits do not exceed the dollar amount of such proposed investment.

(ii)

Applicable date

For purposes of this subparagraph, the applicable date is—

(I)

in the case of taxable years beginning in 2008 and 2009, September 15, 2010, or

(II)

in the case of a taxable year beginning in 2010, the due date (including extensions of time) for filing the taxpayer’s return for such taxable year.

.

(b)

Effective Date

The amendment made by this section shall apply to taxable years beginning after December 31, 2007, and to carrybacks of credits from such taxable years.

3.

Five-year carryback of low income housing credit

(a)

In general

Subsection (a) of section 39 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

(4)

5-year carryback of low income housing credit

(A)

In general

In the case of an applicable low income housing credit—

(i)

this section shall be applied separately from the business credit (other than the low income housing credit), and

(ii)

paragraph (1) shall be applied by substituting each of the 5 taxable years for the taxable year in subparagraph (A) thereof.

.

(b)

Effective date

The amendment made by this section shall apply to taxable years beginning after December 31, 2007, and to carrybacks of credits from such taxable years.