HOPE (Humans over Private Equity) for Homeownership Act
- Bill Number
- S. 3930
- Origin Chamber
- Senate
- Congress
- 119th Congress, Session 2
- Policy Area
- Taxation
- Status
- Introduced
- Latest Action
- 2026-02-26: Read twice and referred to the Committee on Finance.
- Last Updated
- 2026-03-18T18:16:13Z
AI-Generated Summary
Purpose This legislation, titled the "HOPE (Humans over Private Equity) for Homeownership Act," amends the Internal Revenue Code of 1986 to impose an excise tax and other tax measures on certain large investment entities acquiring single-family residences. The stated goal is to limit acquisitions by these entities and encourage homeownership by individuals.
Key Provisions
- Excise Tax (Section 2): Imposes a 15% tax on the purchase price of any newly acquired single-family residence (1-to-4 dwelling units) bought by a "hedge fund taxpayer" in taxable years after enactment.
- A "hedge fund taxpayer" is defined as an applicable entity (partnership, corporation, or real estate investment trust) that manages pooled investor funds, holds $50 million or more in assets under management, and acts as a fiduciary.
- Aggregation rules treat related entities as a single taxpayer.
- Exception applies if the property is used as the principal residence of an owner with an interest in the entity and is not rented.
- Corporate Surtax (Section 3): Increases the corporate tax rate by 5 percentage points for corporations meeting the hedge fund taxpayer definition, effective for taxable years after December 31, 2035.
- Deduction Disallowances (Section 4):
- Prohibits mortgage interest deductions on acquisition debt for single-family residences held by hedge fund taxpayers in the rental business (effective after December 31, 2030).
- Disallows depreciation deductions for such properties (effective after December 31, 2030).
- Excludes the rental business of hedge fund taxpayers from the qualified business income deduction (effective after December 31, 2035).
Significant Changes to Existing Law
- Adds a new Chapter 50B to Subtitle D of the Internal Revenue Code, creating the first excise tax specifically targeting hedge fund acquisitions of residential property.
- Modifies sections 11, 163, 167, and 199A to apply new surtaxes and limit deductions previously available to real estate investors.
- Introduces targeted definitions and aggregation rules that expand the scope beyond standard entity classifications.
Potential Impacts
- Government Agencies: Increases IRS responsibilities for enforcement, valuation of assets under management, and collection of the new excise tax.
- Citizens: May reduce institutional purchases of single-family homes, potentially affecting housing availability and prices for individual buyers.
- International Relations: No direct provisions address foreign entities or cross-border activities.
Main Stakeholders Affected
- Hedge fund taxpayers and similar large investment entities engaged in real estate.
- Real estate investment trusts, partnerships, and corporations meeting the $50 million threshold.
- Individuals and families seeking to purchase single-family homes.
- The Internal Revenue Service for administration and compliance.
Notable Legal, Constitutional, or Political Implications
- The bill uses the tax code to influence private investment behavior in housing without direct regulatory prohibitions.
- Effective dates are staggered across 2030 and 2035, creating phased implementation.
- Aggregation rules and fiduciary requirements may raise questions about application to complex investment structures, though the bill does not address constitutional challenges such as equal protection or takings claims.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (1)
Recent Actions
- 2026-02-26: Read twice and referred to the Committee on Finance.
- 2026-02-26: Introduced in Senate
Bill Versions
- HOPE (Humans over Private Equity) for Homeownership Act — issued 2026-02-26 — PDF (9 pages)