Overview
Title
To amend the Internal Revenue Code of 1986 to provide a refundable credit for certain home accessibility improvements.
ELI5 AI
The bill wants to give people some money back, like a coupon, when they spend money to make their homes easier to live in if they're older or have trouble moving around, like by adding ramps or bigger doors. But, not everyone can get this "coupon," and how much you earn might mean you get less or none at all.
Summary AI
H.R. 2749 aims to amend the Internal Revenue Code to provide a refundable tax credit for certain home accessibility improvements. This bill allows individuals to receive a credit of up to 35% of the costs associated with making their homes more accessible for those with disabilities or aged 60 and above. There are specific expenditure limits and income-based reductions for eligibility, and improvements include things like installing ramps, widening doorways, and modifying bathrooms. The bill also mandates a study to assess the effectiveness of the tax credit and to explore potential expansions or alternative solutions to enhance accessibility options.
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AnalysisAI
Summary of the Bill
H.R. 2749 aims to amend the Internal Revenue Code of 1986 by introducing a refundable tax credit for certain home accessibility improvements. Specifically, this credit targets making homes safer and more accessible for individuals who are elderly, blind, or have disabilities. The legislation proposes a 35% credit on qualifying expenditures, with limits set at $10,000 annually and $30,000 cumulatively. The bill seeks to incentivize modifications such as ramps, handrails, widened doorways, and other alterations that enhance home accessibility.
Significant Issues
One of the primary concerns with this bill revolves around the broad definition of "qualified improvements." While the intention is to cover a comprehensive range of modifications, taxpayers might find it challenging to determine whether specific changes to their homes are eligible for the credit without more explicit guidelines or examples.
Moreover, there are income limitations that could restrict the number of people who can benefit from this measure. Although the credit is aimed at assisting those in need, middle-income individuals might find themselves ineligible if their earnings exceed the prescribed thresholds.
Another notable issue is the requirement for a "disability certification," which could impose an administrative burden on individuals needing to prove eligibility. This process can be time-consuming and costly, potentially deterring deserving individuals from applying for the credit.
Additionally, the involvement of multiple governmental agencies in maintaining a list of approved modifications could lead to bureaucratic delays, affecting the efficiency and responsiveness of updating eligible improvements.
Impact on the Public
The proposed tax credit has the potential to significantly impact the public by making home modifications more affordable. These modifications are intended to allow individuals to live comfortably and safely in their homes, potentially reducing the need for more costly institutional care.
For the broader public, the bill could encourage a trend towards more inclusive housing options, recognizing the growing need for homes that accommodate people with varying levels of mobility and other disabilities.
Impact on Specific Stakeholders
For individuals who are elderly or have disabilities, and their families, this legislation could provide a tangible financial benefit by reducing the costs of necessary home modifications. This assistance could dramatically improve their quality of life, allowing them to live independently for longer periods.
Conversely, the bill might not sufficiently reach lower-income households who lack the initial capital for these improvements, even with the promise of a tax refund. Additionally, individuals who cannot easily obtain a disability certification may not benefit directly from this initiative, highlighting an area where the bill could be improved.
Home builders and contractors specializing in accessibility upgrades may see increased demand for their services as more people take advantage of the tax credit, potentially leading to economic benefits within this sector.
In summary, while H.R. 2749 presents an opportunity to support the rights of the elderly and disabled to live independently, its impact will significantly depend on the ease with which taxpayers can navigate the associated requirements and limitations. Addressing the issues of eligibility criteria, income thresholds, and bureaucratic inefficiencies will be crucial in ensuring this bill effectively serves its intended purpose.
Financial Assessment
The bill H.R. 2749 introduces a refundable tax credit designed to assist individuals in making their homes more accessible. The credit is applicable for costs incurred for specific home modifications that aid those with disabilities or individuals aged 60 and above.
Financial Provisions
Refundable Tax Credit Amounts
The bill specifies that individuals can receive a tax credit equal to 35% of qualified home accessibility improvement expenses. The financial framework places a cap on these improvements, allowing a maximum credit for expenditures of up to $10,000 per taxable year and $30,000 over all taxable years.
Income Limitations
The tax credit's accessibility is governed by income-based restrictions. The bill sets an applicable threshold amount for taxpayers to determine the upper limit of income eligible for the full credit: $400,000 for joint returns or surviving spouses, and $200,000 for heads of households and other individuals. Above these thresholds, the credit begins to phase out with a phaseout amount of $100,000, $75,000, and $50,000 respectively.
Relation to Identified Issues
The income limitations mentioned in Section 36C(b)(2) could present challenges, particularly for middle-income earners who surpass the threshold lacking other accessible financial options. As such, the bill's financial design may inadvertently limit the availability of the tax credit to the people who could potentially benefit the most from these modifications.
Furthermore, the bill mandates a cost-of-living adjustment for amounts referenced in the income thresholds and annual caps to ensure these figures remain relevant over time. This adjustment kicks in starting the calendar year after 2025, aimed at preserving the buying power of the credit. However, considering inflationary pressures and living cost changes, detailed guidelines or examples might be necessary to clarify how these adjustments will be implemented effectively.
Administrative Costs and Impacts
The bill's financial framework also introduces a denial of double benefit rule. This rule is designed to prevent taxpayers from utilizing the same expense for multiple benefits within a single taxable year. This provision may necessitate detailed guidance to avoid complexity for taxpayers unfamiliar with tax filings, posing a potential barrier to fully utilizing the tax credit.
Additionally, administrative and bureaucratic costs could arise from the bill's stipulation that improvements conform to an established list under subsection 36C(d)(3). The Secretary of Treasury, alongside other agencies, will need to coordinate to maintain this list, which could delay or complicate the process of approving eligible expenditures.
Conclusion
In summary, while the bill establishes a comprehensive financial framework to enhance home accessibility, its caps and income thresholds ensure that the credit aims to reach those most in need. However, potential complexities and limitationsâsuch as income phaseout and administrative hurdlesâhighlight the importance of clear guidelines and effective administration to ensure the credit realizes its intended benefits effectively.
Issues
The definition of 'qualified improvements' in Section 36C(d)(2) is extensive, which may require clarification or examples to aid in understanding which modifications qualify. This could create confusion for taxpayers who are unsure whether their modifications are eligible for the credit.
The income limitations in Section 36C(b)(2) might disproportionately affect middle-income individuals who could benefit from the credit but exceed the income thresholds. This could limit the accessibility of the tax credit to those who need it.
The requirement for a 'disability certification' in Section 36C(c)(2) may create barriers for disabled individuals due to the administrative burden and costs associated with obtaining such certifications.
The 'denial of double benefit' rule in Section 36C(e)(3) could inadvertently penalize taxpayers who may unknowingly apply for multiple benefits, suggesting a need for clear guidelines or safeguards to prevent misunderstandings.
The involvement of multiple agencies in establishing and maintaining the list of modifications as per Section 36C(d)(3) may result in bureaucratic inefficiencies or delays, affecting the timely updating of the list and potentially excluding necessary improvements.
The data sharing requirements between governmental departments in Section (f) could raise privacy concerns regarding the collection, storage, and usage of personal health and financial information if not adequately safeguarded.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Refundable tax credit for certain home accessibility improvements Read Opens in new tab
Summary AI
The section introduces a new tax credit for individuals who make home improvements to enhance accessibility for themselves, their spouses, or dependents who are blind, disabled, or over 60 years old. The credit covers 35% of qualifying expenditures, with specific dollar and income limitations, and includes various modifications like ramps, handrails, and bathroom upgrades.
Money References
- â(b) Limitations.â â(1) DOLLAR LIMITATIONS.âThe aggregate amount of qualified home accessibility improvement expenditures taken into account under subsection (a) shall not exceedâ â(A) $10,000 for any taxable year, and â(B) $30,000 for all taxable years.
- â(B) APPLICABLE THRESHOLD AMOUNT.âFor purposes of this paragraph, the term âapplicable threshold amountâ means, with respect to any taxpayerâ â(i) $400,000, in the case of a joint return or surviving spouse (as defined in section 2), â(ii) $200,000, in the case of a head of household, and â(iii) $200,000, in any other case.
- â(C) APPLICABLE PHASEOUT AMOUNT.âFor purposes of this paragraph, the term âapplicable phaseout amountâ means, with respect to any taxpayerâ â(i) $100,000, in the case of a joint return or surviving spouse (as defined in section 2), â(ii) $75,000, in the case of a head of household, and â(iii) $50,000, in any other case.
- â(e) Special rules.â â(1) INFLATION ADJUSTMENT.âIn the case of any taxable year beginning in a calendar year after 2025, each of the dollar amounts in subsections (b)(1), (b)(2)(B), and (b)(2)(C) shall be increased by an amount equal toâ â(A) such dollar amount, multiplied by â(B) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting âcalendar year 2024â for âcalendar year 2016â in subparagraph (A)(ii) thereof.
- Any increase determined under the preceding sentence which is not a multiple of $50 shall be rounded to the nearest multiple of $50.
36C. Credit for certain home accessibility improvements Read Opens in new tab
Summary AI
Under Section 36C, individuals can get a tax credit covering 35% of the costs for making home improvements to enhance accessibility for qualified individuals, up to $10,000 per year and $30,000 over several years. These improvements are designed to make the home safer and more accessible, especially for those who are elderly or have disabilities, and include specific modifications like ramps, grab bars, and widened doorways.
Money References
- (1) DOLLAR LIMITATIONS.âThe aggregate amount of qualified home accessibility improvement expenditures taken into account under subsection (a) shall not exceedâ (A) $10,000 for any taxable year, and (B) $30,000 for all taxable years.
- (B) APPLICABLE THRESHOLD AMOUNT.âFor purposes of this paragraph, the term âapplicable threshold amountâ means, with respect to any taxpayerâ (i) $400,000, in the case of a joint return or surviving spouse (as defined in section 2), (ii) $200,000, in the case of a head of household, and (iii) $200,000, in any other case.
- (C) APPLICABLE PHASEOUT AMOUNT.âFor purposes of this paragraph, the term âapplicable phaseout amountâ means, with respect to any taxpayerâ (i) $100,000, in the case of a joint return or surviving spouse (as defined in section 2), (ii) $75,000, in the case of a head of household, and (iii) $50,000, in any other case.
- (e) Special rules.â (1) INFLATION ADJUSTMENT.âIn the case of any taxable year beginning in a calendar year after 2025, each of the dollar amounts in subsections (b)(1), (b)(2)(B), and (b)(2)(C) shall be increased by an amount equal toâ (A) such dollar amount, multiplied by (B) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting âcalendar year 2024â for âcalendar year 2016â in subparagraph (A)(ii) thereof.
- Any increase determined under the preceding sentence which is not a multiple of $50 shall be rounded to the nearest multiple of $50. (2) SUBSTANTIATION.âNo credit shall be allowed under this section unless the taxpayer provides (at such time and in such manner as the Secretary may provide) such substantiation of the taxpayerâs eligibility for the credit allowed under this section (and the amount thereof) as the Secretary may require.