To amend the Internal Revenue Code of 1986 to provide that qualified homeowner downpayment assistance is a charitable purpose.

Amends the Internal Revenue Code to deem qualified homeowner downpayment assistance as a charitable purpose for income, estate, and gift tax purposes. Defines "qualified homeowner downpayment assistance" as a gift of cash for the purpose of providing any downpayment for the purchase of a principal residence for a taxpayer whose modified adjusted gross income does not exceed $110,000. Limits the amount of such gift to the lesser of $60,000 or 20 percent of the value of the residence.

Denies an income tax deduction to a donor of homeowner downpayment assistance who receives a direct financial benefit in connection with the purchase of a principal residence for which downpayment assistance was provided.

[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4430 Introduced in House (IH)]







109th CONGRESS
  1st Session
                                H. R. 4430

 To amend the Internal Revenue Code of 1986 to provide that qualified 
       homeowner downpayment assistance is a charitable purpose.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           November 18, 2005

Mr. Weldon of Florida 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 provide that qualified 
       homeowner downpayment assistance is a charitable purpose.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. QUALIFIED HOMEOWNER DOWNPAYMENT ASSISTANCE.

    (a) In General.--Section 501 of the Internal Revenue Code of 1986 
(relating to exemption of tax on corporations, certain trusts, etc.) is 
amended by redesignating subsection (q) as subsection (r) and by 
inserting after subsection (p) the following new subsection:
    ``(q) Qualified Homeowner Downpayment Assistance.--
            ``(1) In general.--For purposes of subsection (c)(3) and 
        sections 170(c)(2), 2055(a)(2), and 2522(a)(2), the term 
        `charitable purposes' includes the provision of qualified 
        homeowner downpayment assistance.
            ``(2) Qualified homeowner downpayment assistance.--For 
        purposes of this subsection, the term `qualified homeowner 
        downpayment assistance' means a gift of cash for the purpose of 
        providing any downpayment for the acquisition of any property 
        as a principal residence (within the meaning of section 121) 
        for a qualified taxpayer if with respect to such property such 
        gift does not exceed the lesser of--
                    ``(A) $60,000, or
                    ``(B) 20 percent of the value of such property, 
                determined as of the time the homeowner downpayment 
                assistance is provided.
            ``(3) Qualified taxpayer.--For purposes of paragraph (2), 
        the term `qualified taxpayer' means a taxpayer whose modified 
        adjusted gross income for the taxable year in which the 
        downpayment assistance is received does not exceed $110,000 
        ($220,000 in the case of a joint return). For purposes of the 
        preceding sentence, the term `modified adjusted gross income' 
        means adjusted gross income increased by any amount excluded 
        from gross income under section 911, 931, or 933.''.
    (b) No Charitable Deduction for Contributions for Downpayment 
Assistance.--Subsection (f) of section 170 of the Internal Revenue Code 
of 1986 (relating to disallowance of deduction in certain cases and 
special rules) is amended by adding at the end the following new 
paragraph:
            ``(12) Denial of deduction of contributions for downpayment 
        assistance.--No deduction shall be allowed under this section 
        for a contribution to an organization which provides homeowner 
        downpayment assistance if the contribution is made directly or 
        indirectly in connection with a transaction in which the 
        purchaser of a home received downpayment assistance and the 
        contributor--
                    ``(A) received the downpayment assistance,
                    ``(B) sold the home to the purchaser,
                    ``(C) loaned money to the purchaser, or
                    ``(D) otherwise received a commission or other 
                benefit associated with the transaction.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after the date of the enactment of this 
Act.
                                 <all>