Sponsors (13)
The bill narrows tax benefits for many single-family rental owners to reduce tax avoidance and protect certain affordable-housing channels, but it raises taxes and compliance costs for landlords—risks that may be passed to renters and could reduce small-scale rental investment.
Owners who sell covered single-family rental properties to individuals for use as a primary residence can still claim interest and depreciation in the year of sale, making conversions to owner-occupied housing (and related tax adjustments) easier.
Sales to qualified nonprofit organizations remain eligible for interest and depreciation in the year of sale, supporting nonprofit acquisition and stewardship of affordable housing.
Properties that receive low-income housing tax credits are exempted from the new rule, preserving existing incentives for development and retention of affordable rental housing.
Owners of 50 or more single-family rentals and other disqualified owners lose the ability to deduct interest and/or depreciation, increasing their taxable income and tax bills.
Higher tax costs for affected owners are likely to be passed on to tenants as higher rents or lower maintenance, worsening housing affordability for renters and low-income households.
Loss of depreciation and other tax benefits could deter small-scale investment in single-family rentals, reducing housing supply in some markets and exacerbating affordability problems.
Based on analysis of 3 sections of legislative text.
Disallows interest and depreciation deductions for taxpayers who own 50+ single‑family rental properties, with narrow exceptions for sales to individual owner‑occupants or qualified nonprofits.
Official title: Amend the Internal Revenue Code of 1986 to deny interest and depreciation deductions for taxpayers owning 50 or more single family properties.
Introduced March 11, 2025 by Raphael Gamaliel Warnock · Last progress March 11, 2025
This bill bars large owners of single-family rental homes from claiming interest and depreciation tax deductions for those properties once they own 50 or more such units (counting directly or indirectly). Limited exceptions let the owner claim deductions in the year a property is sold — but only if sold to an individual who will use it as their principal residence or to certain qualified nonprofits; the Treasury must issue anti-avoidance rules.