Home Equity Conversions Act of 1985

Summary

Home Equity Conversions Act of 1985 - Amends the Internal Revenue Code to permit the owner of a residence who has attained the age of 55 to enter into a sale-leaseback transaction with a prospective purchaser of the residence and retain occupancy rights to the residence under a lease requiring a fair rental. Requires the owner of the residence to have owned and used the residence as a principal residence for three of the five years immediately preceding the sale. Allows the purchaser of such residence an income tax deduction for depreciation of the residence. Permits an owner of a residence who sells such residence under a sale-leaseback arrangement to claim the one-time exclusion from income of gain from the sale of a principal residence by an individual aged 55 or older. Excludes from the gross income of such owner the value of any occupancy rights or fair market price discount attributable to retained occupancy rights received in a sale-leaseback transaction. Permits the use of the installment sales method of accounting in reporting gain from the sale of a residence under a sale-leaseback agreement. Provides a special rule for the treatment of an annuity purchased for the owner-occupant under a sale-leaseback transaction. Establishes a legal presumption that a sale-leaseback transaction for the sale of a residence under this Act is an activity engaged in for profit for purposes of the deductibility of certain related business expenses. Exempts the purchaser of a residence under a sale-leaseback agreement from rules disallowing income tax deductions for personal use of a residence. Permits the purchaser in a sale-leaseback transaction of a principal residence to use the accelerated cost recovery system of depreciation.

This text is taken from the official record. PoliticalRepo does not editorialize.

Timeline

1. 31 January 1985

   Introduced

   Read twice and referred to the Committee on Finance.

   Source: IntroReferral

2. 31 January 1985

   Introduced

   Introduced in Senate

   Source: IntroReferral

3. 11 February 1985

   Committee

   Committee on Finance requested executive comment from OMB, Treasury Department.

   Source: Committee

Votes

No vote records are attached yet.

Versions

No version snapshots stored. Document URLs remain at the source.

Documents

1 official file

• Introduced in Senate

  summary · EN · 31 January 1985

  Open at official source

Sponsors

• Sen. Specter, Arlen [R-PA] · R · Sponsor
• · ssfi00 · Standing

Related records

• related to → Home Equity Conversions Act of 1985