H.R. 8996

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 8996 Introduced in House (IH)]

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119th CONGRESS
2d Session
H. R. 8996

To amend the Internal Revenue Code of 1986 to provide bonus 
depreciation for long-term residential rental housing.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

May 21, 2026

Ms. Sanchez (for herself, Ms. Tenney, Mr. Panetta, and Mr. LaHood) 
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 bonus 
depreciation for long-term residential rental housing.

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 ``Rental Housing Investment Act''.

SEC. 2. TAX INCENTIVES FOR LONG-TERM RESIDENTIAL RENTAL HOUSING.

(a) Special Depreciation Allowance.--
(1) In general.--Section 168 of the Internal Revenue Code 
of 1986, as amended by section 70307 of Public Law 119-21, is 
amended by adding at the end the following new subsection:
``(o) Special Allowance for Long-Term Residential Rental 
Property.--
``(1) In general.--In the case of any long-term residential 
rental property of a taxpayer making an election under this 
subsection--
``(A) the depreciation deduction provided by 
section 167(a) for the taxable year in which such 
property is placed in service shall include an 
allowance equal to the lesser of--
``(i) an amount equal to the product of--
``(I) the total number of dwelling 
units in the long-term residential 
rental property, multiplied by
``(II) $150,000, or
``(ii) 100 percent of the adjusted basis of 
the long-term residential rental property 
(other than land), and
``(B) the adjusted basis of the long-term 
residential rental property shall be reduced by the 
amount of such deduction before computing the amount 
otherwise allowable as a depreciation deduction under 
this chapter for such taxable year and any subsequent 
taxable year.
``(2) Long-term residential rental property.--For purposes 
of this subsection, the term `long-term residential rental 
property' means property--
``(A) to which this section applies,
``(B) which is placed in service in the United 
States after the date of enactment of this subsection,
``(C) which--
``(i) is used as residential rental 
property (as defined in subsection (e)(2)(A)), 
and
``(ii) consists of not less than 2 dwelling 
units,
``(D) the original use of which commences with the 
taxpayer, and
``(E) which is designated by the taxpayer in the 
election made under this subsection.
``(3) Deduction allowed in computing minimum tax.--For 
purposes of determining alternative minimum taxable income 
under section 55, the deduction under section 167 for long-term 
residential rental property shall be determined under this 
section without regard to any adjustment under section 56.
``(4) Recapture.--If, at any time during the 10-year period 
beginning on the date that any long-term residential rental 
property is placed in service by the taxpayer, such property 
ceases to be used as described in paragraph (2)(C)--
``(A) section 1245 shall be applied--
``(i) by treating such property as having 
been disposed of by the taxpayer as of the 
first time such property is so used, and
``(ii) by treating the amount described in 
subparagraph (B) of section 1245(a)(1) with 
respect to such disposition as being not less 
than the amount described in subparagraph (A) 
of such section, and
``(B) the basis of the taxpayer in such property, 
and the taxpayer's allowance for depreciation with 
respect to such property, shall be appropriately 
adjusted to take into account amounts recognized by 
reason of subparagraph (A).
``(5) Additional amount for affordable housing.--
``(A) In general.--In the case of any long-term 
residential rental property which is part of a project 
which meets any of the requirements described in 
subparagraph (A), (B), or (C) of section 42(g)(1), as 
elected by the taxpayer, paragraph (1)(A)(i)(II) shall 
be applied with respect to such property by 
substituting `$250,000' for `$150,000'.
``(B) Extended recapture period.--In the case of 
any long-term residential rental property described in 
subparagraph (A), if, at any time during the 15-year 
period beginning on the date that such property is 
placed in service by the taxpayer, such property ceases 
to satisfy the requirements described in such 
subparagraph, subparagraphs (A) and (B) of paragraph 
(4) shall apply.
``(6) Election.--
``(A) In general.--An election under this 
subsection for any taxable year shall--
``(i) specify the property subject to the 
election, and
``(ii) except as otherwise provided by the 
Secretary, be made on the taxpayer's return of 
the tax imposed by this chapter for the taxable 
year.
Such election shall be made in such manner as the 
Secretary may prescribe by regulations or other 
guidance.
``(B) Election.--Any election made under this 
subsection, and any specification contained in any such 
election, may not be revoked except with the consent of 
the Secretary (and the Secretary shall provide such 
consent only in extraordinary circumstances).
``(7) Regulations.--The Secretary shall issue such 
regulations or other guidance as may be necessary or 
appropriate to carry out the purposes of this subsection, 
including regulations or other guidance regarding--
``(A) the application of paragraph (5) in a manner 
which is consistent with the application of section 
42(g), and
``(B) certification of compliance with the 
requirements under such paragraph.''.
(2) Treatment of long-term residential rental property as 
section 1245 property.--Section 1245(a)(3) of the Internal 
Revenue Code of 1986 is amended by striking ``or'' at the end 
of subparagraph (F), by striking the period at the end of 
subparagraph (G) and inserting ``, or'', and by adding at the 
end the following new subparagraph:
``(H) any long-term residential rental property (as 
defined in section 168(o)(2)).''.
(b) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date which is 12 months 
after the date of the enactment of this Act.
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