S.Amdt. 4322

This amendment seeks to change the Internal Revenue Code of 1986 by removing certain tax breaks for taxpayers who own a large number of single family rental properties.

Key Changes

• Interest Deduction: It would stop "disqualified single family property owners" from deducting interest paid or accrued on single family residential rental properties.
• Depreciation Deduction: It would stop "disqualified single family property owners" from taking depreciation deductions for these properties.

Who is Affected

• A disqualified single family property owner is defined as any taxpayer who owns 50 or more single family residential rental properties.
• Single family residential rental property is defined as residential rental property with 4 or fewer dwelling units.

Exceptions

The deduction for interest and depreciation may still be allowed in the year a property is sold, but only if the sale is made to:

• An individual using the property as their main home.
• A qualified nonprofit organization, which includes groups like land banks, community land trusts, and certain housing development organizations that focus on affordable housing.

The amendment also excludes properties that receive a section 42 credit or properties that the taxpayer constructed or acquired before the first resident moved in.