119-s1459

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 1459 Introduced in Senate

    (IS) ]

<DOC>

119th CONGRESS
 1st Session
 S. 1459

 To amend the Internal Revenue Code of 1986 to improve the historic 
 rehabilitation tax credit, and for other purposes.

_______________________________________________________________________

 IN THE SENATE OF THE UNITED STATES

 April 10, 2025

 Mr. Cassidy (for himself, Mr. Warner, Ms. Collins, and Ms. Cantwell) 
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 improve the historic 
 rehabilitation tax credit, 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 ``Historic Tax Credit Growth and 
Opportunity Act of 2025''.

SEC. 2. FULL CREDIT ALLOWED IN THE YEAR BUILDING PLACED IN SERVICE.

    (a) In General.--

Section 47

    (a) of the Internal Revenue Code of 1986 
is amended to read as follows:
 ``

    (a) General Rule.--For purposes of 

section 46, the rehabilitation 
credit for any taxable year is 20 percent of the qualified 
rehabilitation expenditures.''.

    (b) Effective Date.--The amendment made by this section shall apply 
to property placed in service after December 31, 2023.

SEC. 3. INCREASE IN THE REHABILITATION CREDIT FOR CERTAIN SMALL 
 PROJECTS.

    (a) In General.--

Section 47 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new subsection:
 ``

    (e) Special Rule Regarding Certain Small Projects.--
 ``

    (1) In general.--In the case of any qualifying small 
 project with respect to which there is an election in effect 
 under this subsection--
 ``
        (A) the total qualified rehabilitation 
 expenditures taken into account for purposes of this 
 section with respect to the rehabilitation shall not 
 exceed $3,750,000,
 ``
        (B) subsection

    (a) shall be applied by 
 substituting `30 percent' for `20 percent', and
 ``
            (C) subject to paragraph

    (4) and such regulations 
 or other guidance as the Secretary may provide, the 
 taxpayer may transfer all or a portion of the credit 
 determined under this section with respect to such 
 qualifying small project.
 ``

    (2) Qualifying small project.--For purposes of this 
 subsection, the term `qualifying small project' means any 
 qualified rehabilitated building or portion thereof if--
 ``
        (A) such building is placed in service after the 
 date of the enactment of this subsection, and
 ``
        (B) no credit was allowed under this section 
 (other than a credits allowed by reason of subsection
            (d) ) for either of the two immediately preceding 
 taxable years with respect to such building.
 ``

    (3) Special rule for rural projects.--
 ``
        (A) In general.--In the case of any qualifying 
 small project in a rural area, paragraph

    (1)
        (A) shall 
 be applied by substituting `$5,000,000' for 
 `$3,750,000'.
 ``
        (B) Rural area.--For purposes of this 
 subparagraph, the term `rural area' means any area 
 other than--
 ``
            (i) a city or town that has a population 
 of greater than 50,000 inhabitants, or
 ``
            (ii) the urbanized area contiguous and 
 adjacent to a city or town described in clause
            (i) , as defined by the Bureau of the Census 
 based on the latest decennial census of the 
 United States.
 ``

    (4) Transfer of credit for qualifying small projects.--
 ``
        (A) Certification.--
 ``
            (i) In general.--A transfer under 
 paragraph

    (1)
            (C) ) shall be accompanied by a 
 certificate which includes--
 ``
            (I) the certification for the 
 certified historic structure referred 
 to in subsection
            (c) (3) ,
 ``
            (II) the taxpayer's name, 
 address, tax identification number, 
 date of project completion, and the 
 amount of credit being transferred,
 ``
            (III) the transferee's name, 
 address, tax identification number, and 
 the amount of credit being transferred, 
 and
 ``
            (IV) such other information as 
 may be required by the Secretary.
 ``
            (ii) Transferability of certificate.--A 
 certificate issued under this subsection to a 
 taxpayer shall be transferable to any other 
 taxpayer.
 ``
        (B) Tax treatment relating to certificate.--
 ``
            (i) Disallowance of deduction.--No 
 deduction shall be allowed for the amount of 
 consideration paid or incurred by the 
 transferee.
 ``
            (ii) Allowance of credit.--The amount of 
 credit transferred under paragraph

    (1)
            (C) --
 ``
            (I) shall not be allowed to the 
 transferor for any taxable year, and
 ``
            (II) shall be allowable to the 
 transferee as a credit determined under 
 this section for the taxable year of 
 the transferee in which such credit is 
 transferred.
 ``
            (iii) Exclusion.--Gross income shall not 
 include any amount received in connection with 
 the transfer of the certificate.
 ``
            (C) Recapture and other special rules.--The 
 taxpayer who claims a credit determined under this 
 section by reason of a transfer of an amount of credit 
 under paragraph

    (1)
        (A) with respect to an applicable 
 rural project shall be treated as the taxpayer with 
 respect to such project for purposes of 

section 50.
 ``
            (D) Information reporting.--The transferor and 
 the transferee shall each make such reports regarding 
 the transfer of an amount of credit under paragraph

    (1)
            (C) and containing such information as the Secretary 
 may require. The reports required by this subparagraph 
 shall be filed at such time and in such manner as may 
 be required by the Secretary.
 ``
        (E) Regulations.--The Secretary shall prescribe 
 regulations or other guidance to carry out paragraph

    (1)
            (C) and this paragraph in a manner which is 
 consistent with applicable requirements with respect to 
 transfer of credits under 

section 6418.
 ``

    (5) Election.--An election under this subsection shall be 
 made at such time and in such manner as the Secretary may by 
 regulations prescribe.''.

    (b) Effective Date.--The amendment made by this section shall apply 
to property placed in service after the date of the enactment of this 
Act.

SEC. 4. INCREASING THE TYPE OF BUILDINGS ELIGIBLE FOR REHABILITATION.

    (a) In General.--

Section 47
            (c) (1)
        (B)
            (i) 
            (I) of the Internal Revenue 
Code of 1986 is amended by inserting ``50 percent of'' before ``the 
adjusted basis''.

    (b) Effective Date.--The amendment made by subsection

    (a) shall 
apply to property placed in service after the date of the enactment of 
this Act..

SEC. 5. ELIMINATION OF REHABILITATION CREDIT BASIS ADJUSTMENT.

    (a) In General.--

Section 50
            (c) of the Internal Revenue Code of 1986 
is amended by adding at the end the following new paragraph:
 ``

    (6) Exception for rehabilitation credit.--In the case of 
 the rehabilitation credit, paragraph

    (1) shall not apply.''.

    (b) Treatment in Case of Credit Allowed to Lessee.--

Section 50
            (d) of such Code is amended by adding at the end the following: ``In the 
case of the rehabilitation credit, paragraph

    (5)
        (B) of the 

section 48
            (d) referred to in paragraph

    (5) of this subsection shall not 
apply.''.
            (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act.

SEC. 6. MODIFICATIONS REGARDING CERTAIN TAX-EXEMPT USE PROPERTY.

    (a) In General.--

Section 47
            (c) (2)
        (B)
            (v) of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new 
subclause:
 ``
            (III) Disqualified lease rules to 
 apply only in case of government 
 entity.--For purposes of subclause
            (I) , 
 except in the case of a tax-exempt 
 entity described in 

section 168

    (h)

    (2)
        (A)
            (i) , the determination of 
 whether property is tax-exempt use 
 property shall be made under 

section 168

    (h) without regard to whether the 
 property is leased in a disqualified 
 lease (as defined in 

section 168

    (h)

    (1)
        (B)
            (ii) ).''.

    (b) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act.
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