Housing Opportunities and Preservation Enhancement Act of 2026

Section 1400W-1: This section helps low-income individuals by ensuring that at least 70 percent of the residential units in a qualified property are rent-restricted and occupied by individuals whose income is 80 percent or less of the area median income. This can make housing more affordable for everyday people who need a break on rent.

Section 1400W-2: This section provides government agencies and specific tax-exempt organizations with a right of first refusal or purchase option for the property after ten years. This allows public entities or community organizations to secure and maintain affordable housing options for the public over the long term.

Section 1400W-7: This section establishes a shorter 15-year recovery period for the accelerated depreciation of qualified property. This tax benefit encourages investment and rehabilitation work on older residential buildings, which can lead to better living conditions for residents.

Section 1400W-1: To qualify for these tax incentives, partnerships must spend a significant amount of money on rehabilitation—either 20 percent of the building's adjusted basis or at least $20,000 per residential unit over a 24-month period. This high financial barrier could limit which properties are actually fixed up, potentially slowing down community improvements if owners cannot afford the upfront costs.

Section 1400W-6: This section determines the gain or loss on the sale of qualified property based on its fair market value if held for at least 10 years. While this benefits investors, it creates complex tax valuation rules that remove traditional basis adjustments, potentially shielding large financial gains for private entities at the expense of public tax revenue.