Legislation Would Provide Nonrecognition of Gain for Property Sold for Affordable Housing
Rep. Adam Schiff, D-Calif., introduced legislation to allow taxpayers who sell property to an eligible affordable housing operator the option to avoid capital gains tax liability if they use the proceeds to purchase a replacement property within three years. The Affordable and Homeless Housing Incentives Act of 2020 would apply to property with deed restrictions or other legal agreements requiring it to remain affordable for at least 30 years. Eligible affordable housing operators would include state and local government entities (including public housing authorities), tribally designated housing entities, community housing development organizations and low-income housing nonprofits with a record of receiving federal, state or local funding to operating housing. Schiff’s office also released a summary of the legislation.