No Tax on Takings Act

Summary

Excludes from federal gross income any gain a taxpayer realizes when property located in the United States is taken or effectively taken through eminent domain, including sales or exchanges made under threat or imminence of condemnation. Taxpayers may instead elect out so the exclusion does not apply; the Treasury must issue implementing guidance and the rule applies to taxable years ending after enactment.

• Excludes from gross income any gain from U.S. property taken by eminent domain, including threatened or imminent takings.
• Adds a new Internal Revenue Code provision that supersedes the involuntary-conversion rules for covered takings unless a taxpayer elects out.
• Taxpayers can elect out so the exclusion does not apply; the Treasury will set the election form and timing.
• Treasury must issue regulations or guidance to implement the new exclusion.
• Applies only to property located in the United States and to taxable years ending after enactment.
• Amends the Code’s chapter/part structure and updates table entries as a technical change.
• Reduces federal taxable income for affected property owners, which could lower federal revenue collections.
• Does not create new spending, grant programs, or agency authorization—primarily a tax-law change.