r/title-26-INTERNAL-REVENUE-CODE wiki — defined terms

“qualified reservist distribution” applies in that section

the term “qualified reservist distribution” means any distribution to an individual of all or a portion of the balance in the employee’s account under such arrangement if— (A) such individual was (by reason of being a member of a reserve component (as defined in section 101 of title 37 , United States Code)) ordered or called to active duty for a period in excess of 179 days or for an indefinite period, and (B) such distribution is made during the period beginning on the date of such order or call and ending on the last date that reimbursements could otherwise be made under such arrangement for the plan year which includes the date of such order or call.

“salary reduction contribution” applies in that section

The term “salary reduction contribution” means, with respect to a cafeteria plan, any amount which is contributed to the plan at the election of the employee and which is not includible in gross income by reason of this section. (ii) Qualified employee

“simple cafeteria plan” applies in that section

the term “simple cafeteria plan” means a cafeteria plan— (A) which is established and maintained by an eligible employer, and (B) with respect to which the contribution requirements of paragraph (3), and the eligibility and participation requirements of paragraph (4), are met.

“excludable portion” applies in that section

The term “excludable portion” means that portion (or all) of a payment made to any person under any program described in subsection (a) which— (A) is determined by the Secretary of Agriculture to be made primarily for the purpose of conserving soil and water resources, protecting or restoring the environment, improving forests, or providing a habitat for wildlife, and (B) is determined by the Secretary of the Treasury or his delegate as not increasing substantially the annual income derived from the property.

“educational assistance” applies in that section

The term “educational assistance” means— (A) the payment, by an employer, of expenses incurred by or on behalf of an employee for education of the employee (including, but not limited to, tuition, fees, and similar payments, books, supplies, and equipment), (B) the payment by an employer, whether paid to the employee or to a lender, of principal or interest on any qualified education loan (as defined in section 221(d)(1)) incurred by the employee for education of the employee, and (C) the provision, by an employer, of courses of instruction for such employee (including books, supplies, and equipment), but does not include payment for, or the provision of, tools or supplies which may be …

“employee” applies in that section

The term “employee” includes, for any year, an individual who is an employee within the meaning of section 401(c)(1) (relating to self-employed individuals). (3) Employer An individual who owns the entire interest in an unincorporated trade or business shall be treated as his own employer. A partnership shall be treated as the employer of each partner who is an employee within the meaning of paragraph (2). (4) Attribution rules (A) Ownership of stock Ownership of stock in a corporation shall be determined in accordance with the rules provided under subsections (d) and (e) of section 1563 (without regard to section 1563(e)(3)(C)).

“compensation” applies in that section

the term “compensation” has the meaning given such term by section 414(q)(4), except that, under rules prescribed by the Secretary, an employer may elect to determine compensation on any other basis which does not discriminate in favor of highly compensated employees.

“dependent care assistance” applies in that section

The term “dependent care assistance” means the payment of, or provision of, those services which if paid for by the employee would be considered employment-related expenses under section 21(b)(2) (relating to expenses for household and dependent care services necessary for gainful employment). (2) Earned income The term “earned income” shall have the meaning given such term in section 32(c)(2), but such term shall not include any amounts paid or incurred by an employer for dependent care assistance to an employee. (3) Employee

“employee” applies in that section

The term “employee” includes, for any year, an individual who is an employee within the meaning of section 401(c)(1) (relating to self-employed individuals). (4) Employer An individual who owns the entire interest in an unincorporated trade or business shall be treated as his own employer. A partnership shall be treated as the employer of each partner who is an employee within the meaning of paragraph (3). (5) Attribution rules (A) Ownership of stock Ownership of stock in a corporation shall be determined in accordance with the rules provided under subsections (d) and (e) of section 1563 (without regard to section 1563(e)(3)(C)).

“qualified assignment” applies in that section

the term “qualified assignment” means any assignment of a liability to make periodic payments as damages (whether by suit or agreement), or as compensation under any workmen’s compensation act, on account of personal injury or sickness (in a case involving physical injury or physical sickness)— (1) if the assignee assumes such liability from a person who is a party to the suit or agreement, or the workmen’s compensation claim, and (2) if— (A) such periodic payments are fixed and determinable as to amount and time of payment, (B) such periodic payments cannot be accelerated, deferred, increased, or decreased by the recipient of such payments, (C) the assignee’s obligation on account of the …

“qualified funding asset” applies in that section

the term “qualified funding asset” means any annuity contract issued by a company licensed to do business as an insurance company under the laws of any State, or any obligation of the United States, if— (1) such annuity contract or obligation is used by the assignee to fund periodic payments under any qualified assignment, (2) the periods of the payments under the annuity contract or obligation are reasonably related to the periodic payments under the qualified assignment, and the amount of any such payment under the contract or obligation does not exceed the periodic payment to which it relates, (3) such annuity contract or obligation is designated by the taxpayer (in such manner as the …

“difficulty of care payments” applies in that section

The term “difficulty of care payments” means payments to individuals which are not described in subsection (b)(1)(B)(i), and which— (A) are compensation for providing the additional care of a qualified foster individual which is— (i) required by reason of a physical, mental, or emotional handicap of such individual with respect to which the State has determined that there is a need for additional compensation, and (ii) provided in the home of the foster care provider, and (B) are designated by the payor as compensation described in subparagraph (A).

“qualified foster care payment” applies in that section

The term “qualified foster care payment” means any payment made pursuant to a foster care program of a State or political subdivision thereof— (A) which is paid by— (i) a State or political subdivision thereof, or (ii) a qualified foster care placement agency, and (B) which is— (i) paid to the foster care provider for caring for a qualified foster individual in the foster care provider’s home, or (ii) a difficulty of care payment. (2) Qualified foster individual

“qualified foster care placement agency” applies in that section

The term “qualified foster care placement agency” means any placement agency which is licensed or certified by— (A) a State or political subdivision thereof, or (B) an entity designated by a State or political subdivision thereof, for the foster care program of such State or political subdivision to make foster care payments to providers of foster care.

“qualified foster individual” applies in that section

The term “qualified foster individual” means any individual who is living in a foster family home in which such individual was placed by— (A) an agency of a State or political subdivision thereof, or (B) a qualified foster care placement agency. (3) Qualified foster care placement agency

“affiliated group” applies in that section

the term “affiliated group” has the meaning given such term by section 1504(a). (6) Highly compensated employee For purposes of this section,

“airline-related services” applies in that section

the term “airline-related services” means any of the following services provided in connection with air transportation: (i) Catering. (ii) Baggage handling. (iii) Ticketing and reservations. (iv) Flight planning and weather analysis. (v) Restaurants and gift shops located at an airport. (vi) Such other similar services provided to the airline as the Secretary may prescribe. (D) Affiliated group For purposes of this paragraph,

“commuter highway vehicle” applies in that section

The term “commuter highway vehicle” means any highway vehicle— (i) the seating capacity of which is at least 6 adults (not including the driver), and (ii) at least 80 percent of the mileage use of which can reasonably be expected to be— (I) for purposes of transporting employees in connection with travel between their residences and their place of employment, and (II) on trips during which the number of employees transported for such purposes is at least ½ of the adult seating capacity of such vehicle (not including the driver). (C) Qualified parking

“de minimis fringe” applies in that section

The term “de minimis fringe” means any property or service the value of which is (after taking into account the frequency with which similar fringes are provided by the employer to the employer’s employees) so small as to make accounting for it unreasonable or administratively impracticable. (2) Treatment of certain eating facilities The operation by an employer of any eating facility for employees shall be treated as a de minimis fringe if— (A) such facility is located on or near the business premises of the employer, and (B) revenue derived from such facility normally equals or exceeds the direct operating costs of such facility.

“dependent child” applies in that section

the term “dependent child” means any child (as defined in section 152(f)(1)) of the employee— (i) who is a dependent of the employee, or (ii) both of whose parents are deceased and who has not attained age 25. For purposes of the preceding sentence, any child to whom section 152(e) applies shall be treated as the dependent of both parents. (3) Special rule for parents in the case of air transportation Any use of air transportation by a parent of an employee (determined without regard to paragraph (1)(B)) shall be treated as use by the employee.

“employee” applies in that section

the term “employee” includes— (A) any individual who was formerly employed by such employer in such line of business and who separated from service with such employer in such line of business by reason of retirement or disability, and (B) any widow or widower of any individual who died while employed by such employer in such line of business or while an employee within the meaning of subparagraph (A). (2) Spouse and dependent children (A) In general Any use by the spouse or a dependent child of the employee shall be treated as use by the employee. (B) Dependent child For purposes of subparagraph (A),

“employee discount” applies in that section

The term “employee discount” means the amount by which— (A) the price at which the property or services are provided by the employer to an employee for use by such employee, is less than (B) the price at which such property or services are being offered by the employer to customers. (4) Qualified property or services

“gross profit percentage” applies in that section

The term “gross profit percentage” means the percent which— (i) the excess of the aggregate sales price of property sold by the employer to customers over the aggregate cost of such property to the employer, is of (ii) the aggregate sale price of such property. (B) Determination of gross profit percentage Gross profit percentage shall be determined on the basis of— (i) all property offered to customers in the ordinary course of the line of business of the employer in which the employee is performing services (or a reasonable classification of property selected by the employer), and (ii) the employer’s experience during a representative period. (3) Employee discount defined

“highly compensated employee” applies in that section

the term “highly compensated employee” has the meaning given such term by section 414(q). (7) Air cargo For purposes of subsection (b), the transportation of cargo by air and the transportation of passengers by air shall be treated as the same service. (8) Application of section to otherwise taxable educational or training benefits Amounts paid or expenses incurred by the employer for education or training provided to the employee which are not excludable from gross income under section 127 shall be excluded from gross income under this section if (and only if) such amounts or expenses are a working condition fringe.

“no-additional-cost service” applies in that section

the term “no-additional-cost service” means any service provided by an employer to an employee for use by such employee if— (1) such service is offered for sale to customers in the ordinary course of the line of business of the employer in which the employee is performing services, and (2) the employer incurs no substantial additional cost (including forgone revenue) in providing such service to the employee (determined without regard to any amount paid by the employee for such service). (c) Qualified employee discount defined For purposes of this section— (1) Qualified employee discount

“on-premises athletic facility” applies in that section

the term “on-premises athletic facility” means any gym or other athletic facility— (i) which is located on the premises of the employer, (ii) which is operated by the employer, and (iii) substantially all the use of which is by employees of the employer, their spouses, and their dependent children (within the meaning of subsection (h)).

“qualified affiliate” applies in that section

the term “qualified affiliate” means any corporation which is predominantly engaged in airline-related services. (C) Airline-related services For purposes of this paragraph,

“qualified automobile demonstration use” applies in that section

the term “qualified automobile demonstration use” means any use of an automobile by a full-time automobile salesman in the sales area in which the automobile dealer’s sales office is located if— (i) such use is provided primarily to facilitate the salesman’s performance of services for the employer, and (ii) there are substantial restrictions on the personal use of such automobile by such salesman. (4) On-premises gyms and other athletic facilities (A) In general Gross income shall not include the value of any on-premises athletic facility provided by an employer to his employees. (B) On-premises athletic facility For purposes of this paragraph,

“qualified employee discount” applies in that section

The term “qualified employee discount” means any employee discount with respect to qualified property or services to the extent such discount does not exceed— (A) in the case of property, the gross profit percentage of the price at which the property is being offered by the employer to customers, or (B) in the case of services, 20 percent of the price at which the services are being offered by the employer to customers. (2) Gross profit percentage (A) In general

“qualified employer plan” applies in that section

the term “qualified employer plan” means a plan, contract, pension, or account described in section 219(g)(5). (n) Qualified military base realignment and closure fringe For purposes of this section— (1) In general

“qualified military base realignment and closure fringe” applies in that section

The term “qualified military base realignment and closure fringe” means 1 or more payments under the authority of section 1013 of the Demonstration Cities and Metropolitan Development Act of 1966 ( 42 U.S.C. 3374 ) (as in effect on the date of the enactment of the American Recovery and Reinvestment Tax Act of 2009). (2) Limitation With respect to any property, such term shall not include any payment referred to in paragraph (1) to the extent that the sum of all of such payments related to such property exceeds the maximum amount described in subsection (c) of such section (as in effect on such date).

“qualified moving expense reimbursement” applies in that section

The term “qualified moving expense reimbursement” means any amount received (directly or indirectly) by an individual from an employer as a payment for (or a reimbursement of) expenses which would be deductible as moving expenses under section 217 if directly paid or incurred by the individual. Such term shall not include any payment for (or reimbursement of) an expense actually deducted by the individual in a prior taxable year.

“qualified parking” applies in that section

The term “qualified parking” means parking provided to an employee on or near the business premises of the employer or on or near a location from which the employee commutes to work by transportation described in subparagraph (A), in a commuter highway vehicle, or by carpool. Such term shall not include any parking on or near property used by the employee for residential purposes. (D) Transportation provided by employer Transportation referred to in paragraph (1)(A) shall be considered to be provided by an employer if such transportation is furnished in a commuter highway vehicle operated by or for the employer.

“qualified property or services” applies in that section

The term “qualified property or services” means any property (other than real property and other than personal property of a kind held for investment) or services which are offered for sale to customers in the ordinary course of the line of business of the employer in which the employee is performing services. (d) Working condition fringe defined For purposes of this section,

“qualified retirement planning services” applies in that section

the term “qualified retirement planning services” means any retirement planning advice or information provided to an employee and his spouse by an employer maintaining a qualified employer plan. (2) Nondiscrimination rule Subsection (a)(7) shall apply in the case of highly compensated employees only if such services are available on substantially the same terms to each member of the group of employees normally provided education and information regarding the employer’s qualified employer plan. (3) Qualified employer plan For purposes of this subsection,

“qualified transportation fringe” applies in that section

the term “qualified transportation fringe” means any of the following provided by an employer to an employee: (A) Transportation in a commuter highway vehicle if such transportation is in connection with travel between the employee’s residence and place of employment. (B) Any transit pass. (C) Qualified parking. (2) Limitation on exclusion The amount of the fringe benefits which are provided by an employer to any employee and which may be excluded from gross income under subsection (a)(5) shall not exceed— (A) $175 per month in the case of the aggregate of the benefits described in subparagraphs (A) and (B) of paragraph (1), and (B) $175 per month in the case of qualified parking.

“transit pass” applies in that section

The term “transit pass” means any pass, token, farecard, voucher, or similar item entitling a person to transportation (or transportation at a reduced price) if such transportation is— (i) on mass transit facilities (whether or not publicly owned), or (ii) provided by any person in the business of transporting persons for compensation or hire if such transportation is provided in a vehicle meeting the requirements of subparagraph (B)(i). (B) Commuter highway vehicle

“working condition fringe” applies in that section

the term “working condition fringe” means any property or services provided to an employee of the employer to the extent that, if the employee paid for such property or services, such payment would be allowable as a deduction under section 162 or 167. (e) De minimis fringe defined For purposes of this section— (1) In general

“qualified military benefit” applies in that section

The term “qualified military benefit” means any allowance or in-kind benefit (other than personal use of a vehicle) which— (A) is received by any member or former member of the uniformed services of the United States or any dependent of such member by reason of such member’s status or service as a member of such uniformed services, and (B) was excludable from gross income on September 9, 1986 , under any provision of law, regulation, or administrative practice which was in effect on such date (other than a provision of this title).

“applicable fraction” applies in that section

the term “applicable fraction” means the fraction the numerator of which is the amount described in subparagraph (A)(ii) and the denominator of which is the amount described in subparagraph (A)(i). (2) Limitation based on modified adjusted gross income (A) In general If the modified adjusted gross income of the taxpayer for the taxable year exceeds $40,000 ($60,000 in the case of a joint return), the amount which would (but for this paragraph) be excludable from gross income under subsection (a) shall be reduced (but not below zero) by the amount which bears the same ratio to the amount which would be so excludable as such excess bears to $15,000 ($30,000 in the case of a joint return).

“eligible educational institution” applies in that section

The term “eligible educational institution” has the meaning given such term by section 529(e)(5). (4) Modified adjusted gross income

“modified adjusted gross income” applies in that section

The term “modified adjusted gross income” means the adjusted gross income of the taxpayer for the taxable year determined— (A) without regard to this section and sections 85(c), 137, 221, 911, 931, and 933, and (B) after the application of sections 86, 469, and 219.

“qualified higher education expenses” applies in that section

The term “qualified higher education expenses” means tuition and fees required for the enrollment or attendance of— (i) the taxpayer, (ii) the taxpayer’s spouse, or (iii) any dependent of the taxpayer with respect to whom the taxpayer is allowed a deduction under section 151, at an eligible educational institution. (B) Exception for education involving sports, etc. Such term shall not include expenses with respect to any course or other education involving sports, games, or hobbies other than as part of a degree program.

“qualified United States savings bond” applies in that section

The term “qualified United States savings bond” means any United States savings bond issued— (A) after December 31, 1989 , (B) to an individual who has attained age 24 before the date of issuance, and (C) at discount under section 3105 of title 31 , United States Code. (2) Qualified higher education expenses (A) In general

“dwelling unit” applies in that section

The term “dwelling unit” has the meaning given such term by section 280A(f)(1). (B) Public utility

“energy conservation measure” applies in that section

the term “energy conservation measure” means any installation or modification primarily designed to reduce consumption of electricity or natural gas or to improve the management of energy demand with respect to a dwelling unit. (2) Other definitions For purposes of this subsection— (A) Dwelling unit

“person” applies in that section

the term “person” includes the Federal Government, a State or local government or any political subdivision thereof, or any instrumentality of any of the foregoing. (d) Exception This section shall not apply to any payment to or from a qualified cogeneration facility or qualifying small power production facility pursuant to section 210 of the Public Utility Regulatory Policy Act of 1978.

“public utility” applies in that section

The term “public utility” means a person engaged in the sale of electricity or natural gas to residential, commercial, or industrial customers for use by such customers. For purposes of the preceding sentence,

“qualified adoption expenses” applies in that section

the term “qualified adoption expenses” has the meaning given such term by section 23(d) (determined without regard to reimbursements under this section). (e) Certain rules to apply Rules similar to the rules of subsections (e), (f), and (g) of section 23 shall apply for purposes of this section.

“Medicare Advantage MSA” applies in that section

the term “Medicare Advantage MSA” means an Archer MSA (as defined in section 220(d))— (1) which is designated as a Medicare Advantage MSA, (2) with respect to which no contribution may be made other than— (A) a contribution made by the Secretary of Health and Human Services pursuant to part C of title XVIII of the Social Security Act, or (B) a trustee-to-trustee transfer described in subsection (c)(4), (3) the governing instrument of which provides that trustee-to-trustee transfers described in subsection (c)(4) may be made to and from such account, and (4) which is established in connection with an MSA plan described in section 1859(b)(3) of the Social Security Act.

“qualified disaster” applies in that section

the term “qualified disaster” means— (1) a disaster which results from a terroristic or military action (as defined in section 692(c)(2)), (2) a federally declared disaster (as defined by section 165(i)(5)(A)), (3) a disaster which results from an accident involving a common carrier, or from any other event, which is determined by the Secretary to be of a catastrophic nature, or (4) with respect to amounts described in subsection (b)(4), a disaster which is determined by an applicable Federal, State, or local authority (as determined by the Secretary) to warrant assistance from the Federal, State, or local government or agency or instrumentality thereof.

“qualified disaster mitigation payment” applies in that section

the term “qualified disaster mitigation payment” means any amount which is paid pursuant to the Robert T. Stafford Disaster Relief and Emergency Assistance Act (as in effect on the date of the enactment of this subsection) or the National Flood Insurance Act (as in effect on such date) to or for the benefit of the owner of any property for hazard mitigation with respect to such property. Such term shall not include any amount received for the sale or disposition of any property.

“qualified disaster relief payment” applies in that section

the term “qualified disaster relief payment” means any amount paid to or for the benefit of an individual— (1) to reimburse or pay reasonable and necessary personal, family, living, or funeral expenses incurred as a result of a qualified disaster, (2) to reimburse or pay reasonable and necessary expenses incurred for the repair or rehabilitation of a personal residence or repair or replacement of its contents to the extent that the need for such repair, rehabilitation, or replacement is attributable to a qualified disaster, (3) by a person engaged in the furnishing or sale of transportation as a common carrier by reason of the death or personal physical injuries incurred as a result of a …

“qualified payment” applies in that section

The term “qualified payment” means any payment (whether reimbursement or otherwise) provided by a State or political division thereof on account of the performance of services as a member of a qualified volunteer emergency response organization. (B) Applicable dollar limitation The amount determined under subparagraph (A) for any taxable year shall not exceed $50 multiplied by the number of months during such year that the taxpayer performs such services. (3) Qualified volunteer emergency response organization

“qualified state and local tax benefit” applies in that section

The term “qualified state and local tax benefit” means any reduction or rebate of a tax described in paragraph (1), (2), or (3) of section 164(a) provided by a State or political division thereof on account of services performed as a member of a qualified volunteer emergency response organization. (2) Qualified payment (A) In general

“qualified volunteer emergency response organization” applies in that section

The term “qualified volunteer emergency response organization” means any volunteer organization— (A) which is organized and operated to provide firefighting or emergency medical services for persons in the State or political subdivision, as the case may be, and (B) which is required (by written agreement) by the State or political subdivision to furnish firefighting or emergency medical services in such State or political subdivision.

“annualized excludable disability amount” applies in that section

The term “annualized excludable disability amount” means, with respect to any individual, the service-connected excludable disability amounts which are properly attributable to the 12-month period immediately preceding the date on which such individual attains retirement age. (2) Service-connected excludable disability amount

“qualified first responder retirement payments” applies in that section

the term “qualified first responder retirement payments” means, with respect to any taxable year, any pension or annuity which but for this section would be includible in gross income for such taxable year and which is received— (1) from a plan described in clause (iii), (iv), (v), or (vi) of section 402(c)(8)(B), and (2) in connection with such individual’s qualified first responder service. (c) Annualized excludable disability amount For purposes of this section— (1) In general

“qualified first responder service” applies in that section

the term “qualified first responder service” means service as a law enforcement officer, firefighter, paramedic, or emergency medical technician.

“service-connected excludable disability amount” applies in that section

The term “service-connected excludable disability amount” means periodic payments received by an individual which— (A) are not includible in such individual’s gross income under section 104(a)(1), (B) are received in connection with such individual’s qualified first responder service, and (C) terminate when such individual attains retirement age.

“accident or health insurance” applies in that section

The terms “accident or health insurance” and “accident or health plan” have the same meaning as when used in section 105. (5) Dependent

“accident or health plan” applies in that section

The terms “accident or health insurance” and “accident or health plan” have the same meaning as when used in section 105. (5) Dependent

“dependent” applies in that section

The term “dependent” has the meaning given such term by section 152, determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B) thereof. (d) Denial of double benefit Subsection (a) shall not apply to the amount of any qualified Indian health care benefit which is not includible in gross income of the beneficiary of such benefit under any other provision of this chapter, or to the amount of any such benefit for which a deduction is allowed to such beneficiary under any other provision of this chapter.

“Indian tribe” applies in that section

The term “Indian tribe” has the meaning given such term by section 45A(c)(6). (2) Tribal organization

“medical care” applies in that section

The term “medical care” has the same meaning as when used in section 213. (4) Accident or health insurance; accident or health plan

“qualified Indian health care benefit” applies in that section

the term “qualified Indian health care benefit” means— (1) any health service or benefit provided or purchased, directly or indirectly, by the Indian Health Service through a grant to or a contract or compact with an Indian tribe or tribal organization, or through a third-party program funded by the Indian Health Service, (2) medical care provided or purchased by, or amounts to reimburse for such medical care provided by, an Indian tribe or tribal organization for, or to, a member of an Indian tribe, including a spouse or dependent of such a member, (3) coverage under accident or health insurance (or an arrangement having the effect of accident or health insurance), or an accident or health …

“tribal organization” applies in that section

The term “tribal organization” has the meaning given such term by section 4( l ) of the Indian Self-Determination and Education Assistance Act. (3) Medical care

“dependent” applies in that section

The term “dependent” has the meaning given such term by section 152, determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B). (3) Lavish or extravagant The Secretary shall, in consultation with the Tribal Advisory Committee (as established under section 3(a) of the Tribal General Welfare Exclusion Act of 2014), establish guidelines for what constitutes lavish or extravagant benefits with respect to Indian tribal government programs. (4) Establishment of tribal government program A program shall not fail to be treated as an Indian tribal government program solely by reason of the program being established by tribal custom or government practice.

“Indian general welfare benefit” applies in that section

the term “Indian general welfare benefit” includes any payment made or services provided to or on behalf of a member of an Indian tribe (or any spouse or dependent of such a member) pursuant to an Indian tribal government program, but only if— (1) the program is administered under specified guidelines and does not discriminate in favor of members of the governing body of the tribe, and (2) the benefits provided under such program— (A) are available to any tribal member who meets such guidelines, (B) are for the promotion of general welfare, (C) are not lavish or extravagant, and (D) are not compensation for services.

“Indian tribal government” applies in that section

the term “Indian tribal government” includes any agencies or instrumentalities of an Indian tribal government and any Alaska Native regional or village corporation, as defined in, or established pursuant to, the Alaska Native Claims Settlement Act ( 43 U.S.C. 1601 et seq.). (2) Dependent

“covered offense” applies in that section

the term “covered offense” means any criminal offense under Federal or State law, and includes any criminal offense arising from the same course of conduct as that criminal offense.

“wrongfully incarcerated individual” applies in that section

the term “wrongfully incarcerated individual” means an individual— (1) who was convicted of a covered offense, (2) who served all or part of a sentence of imprisonment relating to that covered offense, and (3) (A) who was pardoned, granted clemency, or granted amnesty for that covered offense because that individual was innocent of that covered offense, or (B) (i) for whom the judgment of conviction for that covered offense was reversed or vacated, and (ii) for whom the indictment, information, or other accusatory instrument for that covered offense was dismissed or who was found not guilty at a new trial after the judgment of conviction for that covered offense was reversed or vacated.

“aquaculture facility” applies in that section

The term “aquaculture facility” means any land, structure, or other appurtenance that is used for aquaculture (including any hatchery, rearing pond, raceway, pen, or incubator). (d) Coordination with section 265 In the case of any qualified real estate loan, section 265 shall be applied— (1) by treating any qualified real estate loan for purposes of subsection (a)(2) thereof as an obligation the interest on which is wholly exempt from the taxes imposed by this subtitle, (2) by substituting “25 percent of the interest on indebtedness” for “Interest on indebtedness” in such subsection (a)(2), (3) by treating 25 percent of the adjusted basis of any qualified real estate loan as adjusted basis …

“qualified lender” applies in that section

the term “qualified lender” means— (1) any bank or savings association the deposits of which are insured under the Federal Deposit Insurance Act ( 12 U.S.C. 1811 et seq.), (2) any State- or federally-regulated insurance company, (3) any entity wholly owned, directly or indirectly, by a company that is treated as a bank holding company for purposes of section 8 of the International Banking Act of 1978 ( 12 U.S.C.

“qualified real estate loan” applies in that section

The term “qualified real estate loan” means any loan— (A) secured by— (i) rural or agricultural real estate, or (ii) a leasehold mortgage (with a status as a lien) on rural or agricultural real estate, (B) made to a person other than a specified foreign entity (as defined in section 7701(a)(51)), and (C) made after the date of the enactment of this section. For purposes of the preceding sentence, the determination of whether property securing such loan is rural or agricultural real estate shall be made as of the time the interest income on such loan is accrued.

“rural or agricultural real estate” applies in that section

The term “rural or agricultural real estate” means— (A) any real property which is substantially used for the production of one or more agricultural products, (B) any real property which is substantially used in the trade or business of fishing or seafood processing, and (C) any aquaculture facility. Such term shall not include any property which is not located in a State or a possession of the United States. (4) Aquaculture facility

“government use” applies in that section

The term “government use” means any use other than a private business use. (8) Nonqualified amount For purposes of this subsection,

“nongovernmental output property” applies in that section

the term “nongovernmental output property” means any property (or interest therein) which before such acquisition was used (or held for use) by a person other than a governmental unit in connection with an output facility (within the meaning of subsection (b)(4)) (other than a facility for the furnishing of water). For purposes of the preceding sentence, use (or the holding for use) before October 14, 1987 , shall not be taken into account.

“nonqualified amount” applies in that section

the term “nonqualified amount” means, with respect to an issue, the lesser of— (A) the proceeds of such issue which are to be used for any private business use, or (B) the proceeds of such issue with respect to which there are payments (or property or borrowed money) described in paragraph (2). (9) Exception for qualified 501(c)(3) bonds There shall not be taken into account under this subsection or subsection (c) the portion of the proceeds of an issue which (if issued as a separate issue) would be treated as a qualified 501(c)(3) bond if the issuer elects to treat such portion as a qualified 501(c)(3) bond.

“private activity bond” applies throughout this title

the term “private activity bond” means any bond issued as part of an issue— (1) which meets— (A) the private business use test of paragraph (1) of subsection (b), and (B) the private security or payment test of paragraph (2) of subsection (b), or (2) which meets the private loan financing test of subsection (c). (b) Private business tests (1) Private business use test Except as otherwise provided in this subsection, an issue meets the test of this paragraph if more than 10 percent of the proceeds of the issue are to be used for any private business use.

“private business use” applies in that section

the term “private business use” means use (directly or indirectly) in a trade or business carried on by any person other than a governmental unit. For purposes of the preceding sentence, use as a member of the general public shall not be taken into account. (B) Clarification of trade or business For purposes of the 1st sentence of subparagraph (A), any activity carried on by a person other than a natural person shall be treated as a trade or business.

“qualified annexed area” applies in that section

The term “qualified annexed area” means, with respect to the governmental unit acquiring the property, any area if— (I) such area is contiguous to, and annexed for general governmental purposes into, a qualified service area of such unit, (II) output from such property is made available to all members of the general public in the annexed area, and (III) the annexed area is not greater than 10 percent of such qualified service area.

“qualified bond” applies throughout its part

the term “qualified bond” means any private activity bond if— (1) In general Such bond is— (A) an exempt facility bond, (B) a qualified mortgage bond, (C) a qualified veterans’ mortgage bond, (D) a qualified small issue bond, (E) a qualified student loan bond, (F) a qualified redevelopment bond, or (G) a qualified 501(c)(3) bond. (2) Volume cap Such bond is issued as part of an issue which meets the applicable requirements of section 146, and 1 (3) Other requirements Such bond meets the applicable requirements of each subsection of section 147.

“qualified service area” applies in that section

The term “qualified service area” means, with respect to the governmental unit acquiring the property, any area throughout which such unit provided (at all times during the 10-year period ending on the date such property is acquired by such unit) output of the same type as the output to be provided by such property. For purposes of the preceding sentence, the period before October 14, 1987 , shall not be taken into account. (ii) Qualified annexed area

“applicable income limit” applies in that section

the term “applicable income limit” means— (A) the limitation under subparagraph (A) or (B) of paragraph (1) which applies to the project, or (B) in the case of a unit to which paragraph (4)(B)(i) applies, the limitation which applies to such unit. (6) Special rule for certain high cost housing area In the case of a project located in a city having 5 boroughs and a population in excess of 5,000,000, subparagraph (B) of paragraph (1) shall be applied by substituting “25 percent” for “40 percent”.

“biomass” applies in that section

The term “biomass” means any— (AA) agricultural or plant waste, (BB) byproduct of wood or paper mill operations, including lignin in spent pulping liquors, and (CC) other products of forestry maintenance. (bb) Exclusion The term “biomass” does not include paper which is commonly recycled. (II) Coal

“coal” applies in that section

The term “coal” means anthracite, bituminous coal, subbituminous coal, lignite, and peat. (B) Industrial carbon dioxide facility (i) In general Except as provided in clause (ii),

“elementary school” applies in that section

the terms “elementary school” and “secondary school” have the meanings given such terms by section 14101 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 8801 ), as in effect on the date of the enactment of this subsection. (5) Annual aggregate face amount of tax-exempt financing (A) In general An issue shall not be treated as an issue described in subsection (a)(13) if the aggregate face amount of bonds issued by the State pursuant thereto (when added to the aggregate face amount of bonds previously so issued during the calendar year) exceeds an amount equal to the greater of— (i) $10 multiplied by the State population, or (ii) $5,000,000.

“eligible component” applies in that section

The term “eligible component” means any equipment which is installed in an industrial carbon dioxide facility that satisfies the requirements under paragraph (3) and which is— (I) used for the purpose of capture, treatment and purification, compression, transportation, or on-site storage of carbon dioxide produced by the industrial carbon dioxide facility, or (II) integral or functionally related and subordinate to a process which converts a solid or liquid product from coal, petroleum residue, biomass, or other materials which are recovered for their energy or feedstock value into a synthesis gas composed primarily of carbon dioxide and hydrogen for direct use or subsequent chemical or …

“environmental enhancements of hydroelectric generating facilities” applies in that section

the term “environmental enhancements of hydroelectric generating facilities” means property— (A) the use of which is related to a federally licensed hydroelectric generating facility owned and operated by a governmental unit, and (B) which— (i) protects or promotes fisheries or other wildlife resources, including any fish by-pass facility, fish hatchery, or fisheries enhancement facility, or (ii) is a recreational facility or other improvement required by the terms and conditions of any Federal licensing permit for the operation of such generating facility.

“exempt facility bond” applies throughout its part

the term “exempt facility bond” means any bond issued as part of an issue 95 percent or more of the net proceeds of which are to be used to provide— (1) airports and spaceports, (2) docks and wharves, (3) mass commuting facilities, (4) facilities for the furnishing of water, (5) sewage facilities, (6) solid waste disposal facilities, (7) qualified residential rental projects, (8) facilities for the local furnishing of electric energy or gas, (9) local district heating or cooling facilities, (10) qualified hazardous waste facilities, (11) high-speed intercity rail facilities, (12) environmental enhancements of hydroelectric generating facilities, (13) qualified public educational facilities, …

“facilities for the furnishing of water” applies in that section

the term “facilities for the furnishing of water” means any facility for the furnishing of water if— (1) the water is or will be made available to members of the general public (including electric utility, industrial, agricultural, or commercial users), and (2) either the facility is operated by a governmental unit or the rates for the furnishing or sale of the water have been established or approved by a State or political subdivision thereof, by an agency or instrumentality of the United States, or by a public service or public utility commission or other similar body of any State or political subdivision thereof.

“geological gas facility” applies in that section

The term “geological gas facility” means a facility that— (aa) produces a raw product consisting of gas or mixed gas and liquid from a geological formation, (bb) transports or removes impurities from such product, or (cc) separates such product into its constituent parts. (3) Special rule for facilities with less than 65 percent capture and storage percentage (A) In general Subject to subparagraph (B), the eligible components of an industrial carbon dioxide facility satisfies the requirements of this paragraph if such eligible components are designed to have a capture and storage percentage (as determined under subparagraph (C)) that is equal to or greater than 65 percent.

“gross rent” applies in that section

The term “gross rent” includes— (I) any payment under section 8 of the United States Housing Act of 1937, and (II) any utility allowance determined by the Secretary after taking into account such determinations under such section 8. (5) Applicable income limit For purposes of paragraphs (3) and (4),

“high-speed intercity rail facilities” applies in that section

the term “high-speed intercity rail facilities” means any facility (not including rolling stock) for the fixed guideway rail transportation of passengers and their baggage between metropolitan statistical areas (within the meaning of section 143(k)(2)(B)) using vehicles that are reasonably expected to be capable of attaining a maximum speed in excess of 150 miles per hour between scheduled stops, but only if such facility will be made available to members of the general public as passengers.

“HUD hold harmless impacted project” applies in that section

The term “HUD hold harmless impacted project” means any project with respect to which area median gross income was determined under subparagraph (B) for calendar year 2007 or 2008 if such determination would have been less but for the HUD hold harmless policy. (3) Current income determinations For purposes of this subsection— (A) In general The determination of whether the income of a resident of a unit in a project exceeds the applicable income limit shall be made at least annually on the basis of the current income of the resident.

“HUD hold harmless policy” applies in that section

The term “HUD hold harmless policy” means the regulations under which a policy similar to the rules of clause (i) applied to prevent a change in the method of determining area median gross income from resulting in a reduction in the area median gross income determined with respect to certain projects in calendar years 2007 and 2008. (iv) HUD hold harmless impacted project

“industrial carbon dioxide facility” applies in that section

the term “industrial carbon dioxide facility” means a facility that emits carbon dioxide (including from any fugitive emissions source) that is created as a result of any of the following processes: (I) Fuel combustion. (II) Gasification. (III) Bioindustrial. (IV) Fermentation. (V) Any manufacturing industry relating to— (aa) chemicals, (bb) fertilizers, (cc) glass, (dd) steel, (ee) petroleum residues, (ff) forest products, (gg) agriculture, including feedlots and dairy operations, and (hh) transportation grade liquid fuels.

“local district heating or cooling facility” applies in that section

the term “local district heating or cooling facility” means property used as an integral part of a local district heating or cooling system. (2) Local district heating or cooling system (A) In general For purposes of paragraph (1),

“local district heating or cooling system” applies in that section

the term “local district heating or cooling system” means any local system consisting of a pipeline or network (which may be connected to a heating or cooling source) providing hot water, chilled water, or steam to 2 or more users for— (i) residential, commercial, or industrial heating or cooling, or (ii) process steam. (B) Local system For purposes of this paragraph, a local system includes facilities furnishing heating and cooling to an area consisting of a city and 1 contiguous county. (h) Qualified hazardous waste facilities For purposes of subsection (a)(10),

“local government” applies in that section

The term “local government” has the meaning given such term by section 1393(a)(5). (C) Net benefit of tax-exempt financing

“low-income unit” applies in that section

The term “low-income unit” means any unit which is required to be occupied by individuals who meet the applicable income limit. (ii) Gross rent

“net benefit of tax-exempt financing” applies in that section

The term “net benefit of tax-exempt financing” means the present value of the interest savings (determined by a calculation established by the Secretary) which result from the tax-exempt status of the bonds. (7) Aggregate face amount of tax-exempt financing (A) In general An issue shall not be treated as an issue described in subsection (a)(14) if the aggregate face amount of bonds issued by the State or local government pursuant thereto for a project (when added to the aggregate face amount of bonds previously so issued for such project) exceeds an amount designated by the Secretary as part of the designation.

“person” applies in that section

the term “person” includes a group of related persons (within the meaning of section 144(a)(3)) which includes such person. (g) Local district heating or cooling facility (1) In general For purposes of subsection (a)(9),

“petroleum residue” applies in that section

The term “petroleum residue” means the carbonized product of high-boiling hydrocarbon fractions obtained in petroleum processing. (II) Geological gas facility

“qualified broadband project” applies in that section

the term “qualified broadband project” means any project which— (A) is designed to provide broadband service solely to 1 or more census block groups in which more than 50 percent of residential households do not have access to fixed, terrestrial broadband service which delivers at least 25 megabits per second downstream and at least 3 megabits service upstream, and (B) results in internet access to residential locations, commercial locations, or a combination of residential and commercial locations at speeds not less than 100 megabits per second for downloads and 20 megabits for second for uploads, but only if at least 90 percent of the locations provided such access under the project are …

“qualified building” applies in that section

the term “qualified building” means any building located— (I) in any county in which is located a qualified military installation to which the number of members of the Armed Forces of the United States assigned to units based out of such qualified military installation, as of June 1, 2008 , has increased by not less than 20 percent, as compared to such number on December 31, 2005 , or (II) in any county adjacent to a county described in subclause (I). (iv) Qualified military installation For purposes of clause (iii),

“qualified carbon dioxide capture facility” applies in that section

the term “qualified carbon dioxide capture facility” means— (A) the eligible components of an industrial carbon dioxide facility, and (B) a direct air capture facility (as defined in section 45Q(e)(3)). (2) Definitions For purposes of this subsection: (A) Eligible component (i) In general

“qualified green building and sustainable design project” applies in that section

the term “qualified green building and sustainable design project” means any project which is designated by the Secretary, after consultation with the Administrator of the Environmental Protection Agency, as a qualified green building and sustainable design project and which meets the requirements of clauses (i), (ii), (iii), and (iv) of paragraph (4)(A). (2) Designations (A) In general Within 60 days after the end of the application period described in paragraph (3)(A), the Secretary, after consultation with the Administrator of the Environmental Protection Agency, shall designate qualified green building and sustainable design projects.

“qualified hazardous waste facility” applies in that section

the term “qualified hazardous waste facility” means any facility for the disposal of hazardous waste by incineration or entombment but only if— (1) the facility is subject to final permit requirements under subtitle C of title II of the Solid Waste Disposal Act (as in effect on the date of the enactment of the Tax Reform Act of 1986), and (2) the portion of such facility which is to be provided by the issue does not exceed the portion of the facility which is to be used by persons other than— (A) the owner or operator of such facility, and (B) any related person (within the meaning of section 144(a)(3)) to such owner or operator.

“qualified highway or surface freight transfer facilities” applies in that section

the term “qualified highway or surface freight transfer facilities” means— (A) any surface transportation project which receives Federal assistance under title 23, United States Code (as in effect on the date of the enactment of this subsection), (B) any project for an international bridge or tunnel for which an international entity authorized under Federal or State law is responsible and which receives Federal assistance under title 23, United States Code (as so in effect), or (C) any facility for the transfer of freight from truck to rail or rail to truck (including any temporary storage facilities directly related to such transfers) which receives Federal assistance under either title 23 …

“qualified military installation” applies in that section

the term “qualified military installation” means any military installation or facility the number of members of the Armed Forces of the United States assigned to which, as of June 1, 2008 , is not less than 1,000. (C) Students Rules similar to the rules of section 42(i)(3)(D) shall apply for purposes of this subsection. (D) Single-room occupancy units A unit shall not fail to be treated as a residential unit merely because such unit is a single-room occupancy unit (within the meaning of section 42).

“qualified project period” applies in that section

The term “qualified project period” means the period beginning on the 1st day on which 10 percent of the residential units in the project are occupied and ending on the latest of— (i) the date which is 15 years after the date on which 50 percent of the residential units in the project are occupied, (ii) the 1st day on which no tax-exempt private activity bond issued with respect to the project is outstanding, or (iii) the date on which any assistance provided with respect to the project under section 8 of the United States Housing Act of 1937 terminates.

“qualified public educational facility” applies in that section

the term “qualified public educational facility” means any school facility which is— (A) part of a public elementary school or a public secondary school, and (B) owned by a private, for-profit corporation pursuant to a public-private partnership agreement with a State or local educational agency described in paragraph (2).

“qualified residential rental project” applies in that section

The term “qualified residential rental project” means any project for residential rental property if, at all times during the qualified project period, such project meets the requirements of subparagraph (A) or (B), whichever is elected by the issuer at the time of the issuance of the issue with respect to such project: (A) 20–50 test The project meets the requirements of this subparagraph if 20 percent or more of the residential units in such project are occupied by individuals whose income is 50 percent or less of area median gross income.

“resources” applies in that section

the term “resources” includes tax abatement benefits and contributions in kind. (iv) Size The project includes at least one of the following: (I) At least 1,000,000 square feet of building. (II) At least 20 acres. (v) Use of tax benefit The project proposal includes a description of the net benefit of the tax-exempt financing provided under this subsection which will be allocated for financing of one or more of the following: (I) The purchase, construction, integration, or other use of energy efficiency, renewable energy, and sustainable design features of the project. (II) Compliance with certification standards cited under clause (i).

“rural State” applies in that section

The term “rural State” means any State which has— (i) a population of less than 4,500,000 according to the 2000 census, (ii) a population density of less than 150 people per square mile according to the 2000 census, and (iii) increased in population by less than half the rate of the national increase between the 1990 and 2000 censuses. (B) Local government

“school facility” applies in that section

the term “school facility” means— (A) any school building, (B) any functionally related and subordinate facility and land with respect to such building, including any stadium or other facility primarily used for school events, and (C) any property, to which section 168 applies (or would apply but for section 179), for use in a facility described in subparagraph (A) or (B). (4) Public schools For purposes of this subsection,

“secondary school” applies in that section

the terms “elementary school” and “secondary school” have the meanings given such terms by section 14101 of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 8801 ), as in effect on the date of the enactment of this subsection. (5) Annual aggregate face amount of tax-exempt financing (A) In general An issue shall not be treated as an issue described in subsection (a)(13) if the aggregate face amount of bonds issued by the State pursuant thereto (when added to the aggregate face amount of bonds previously so issued during the calendar year) exceeds an amount equal to the greater of— (i) $10 multiplied by the State population, or (ii) $5,000,000.

“space cargo” applies in that section

The term “space cargo” includes satellites, scientific experiments, other property transported into space, and any other type of payload, whether or not such property returns from space. (B) Spacecraft

“spacecraft” applies in that section

The term “spacecraft” means a launch vehicle or a reentry vehicle. (C) Other terms The terms “launch site”, “crew”, “space flight participant”, “launch services”, “launch vehicle”, “payload”, “reentry services”, “reentry site”, a “reentry vehicle” shall have the respective meanings given to such terms by section 50902 of title 51 , United States Code (as in effect on the date of enactment of this subsection). (3) Public use requirement A facility shall not be required to be available for use by the general public to be treated as a spaceport for purposes of this section.

“spaceport” applies in that section

the term “spaceport” means any facility located at or in close proximity to a launch site or reentry site used for— (A) manufacturing, assembling, or repairing spacecraft, space cargo, other facilities described in this paragraph, or any component of the foregoing, (B) flight control operations, (C) providing launch services and reentry services, or (D) transferring crew, spaceflight participants, or space cargo to or from spacecraft. (2) Additional terms For purposes of paragraph (1)— (A) Space cargo

“acquisition cost” applies in that section

The term “acquisition cost” means the cost of acquiring the residence as a completed residential unit. (B) Exceptions The term “acquisition cost” does not include— (i) usual and reasonable settlement or financing costs, (ii) the value of services performed by the mortgagor or members of his family in completing the residence, and (iii) the cost of land (other than land described in subsection (i)(1)(C)(i)) which has been owned by the mortgagor for at least 2 years before the date on which construction of the residence begins. (C) Special rule for qualified rehabilitation loans In the case of a qualified rehabilitation loan, for purposes of subsection (e),

“adjusted qualifying income” applies in that section

the term “adjusted qualifying income” means the product of— (i) the highest family income which (as of the date the financing was provided) would have met the requirements of subsection (f) with respect to the residents, and (ii) 1.05 to the nth power where “n” equals the number of full years during the period beginning on the date the financing was provided and ending on the date of the disposition. For purposes of clause (i), highest family income shall be determined without regard to subsection (f)(3)(A) and on the basis of the number of members of the taxpayer’s family as of the date of the disposition. (B) Modified adjusted gross income For purposes of paragraph (4),

“applicable median family income” applies in that section

the term “applicable median family income” means, with respect to a residence, whichever of the following is the greater: (A) the area median gross income for the area in which such residence is located, or (B) the statewide median gross income for the State in which such residence is located.

“area of chronic economic distress” applies in that section

the term “area of chronic economic distress” means an area of chronic economic distress— (i) designated by the State as meeting the standards established by the State for purposes of this subsection, and (ii) the designation of which has been approved by the Secretary and the Secretary of Housing and Urban Development.

“average area purchase price” applies throughout its part

the term “average area purchase price” means, with respect to any residence, the average purchase price of single family residences (in the statistical area in which the residence is located) which were purchased during the most recent 12-month period for which sufficient statistical information is available. The determination under the preceding sentence shall be made as of the date on which the commitment to provide the financing is made (or, if earlier, the date of the purchase of the residence).

“contract for deed” applies in that section

the term “contract for deed” means a seller-financed contract for the conveyance of land under which— (I) legal title does not pass to the purchaser until the consideration under the contract is fully paid to the seller, and (II) the seller’s remedy for nonpayment is forfeiture rather than judicial or nonjudicial foreclosure.

“cooperative housing corporation” applies in that section

The term “cooperative housing corporation” has the meaning given to such term by section 216(b)(1). (9) Treatment of limited equity cooperative housing (A) Treatment as residential rental property Except as provided in subparagraph (B), for purposes of this part— (i) any limited equity cooperative housing shall be treated as residential rental property and not as owner-occupied housing, and (ii) bonds issued to provide such housing shall be subject to the same requirements and limitations as bonds the proceeds of which are to be used to provide qualified residential rental projects (as defined in section 142(d)).

“federally declared disaster” applies in that section

the term “federally declared disaster” has the meaning given such term by section 165(h)(3)(C)(i). 1 (D) Election; denial of double benefit (i) Election An election under this paragraph may not be revoked except with the consent of the Secretary. (ii) Denial of double benefit If a taxpayer elects the application of this paragraph, paragraph (11) shall not apply with respect to the purchase or financing of any residence by such taxpayer. (l) Additional requirements for qualified veterans’ mortgage bonds An issue meets the requirements of this subsection only if it meets the requirements of paragraphs (1), (2), and (3).

“federally-subsidized indebtedness” applies in that section

The term “federally-subsidized indebtedness” means any indebtedness if— (i) financing for the indebtedness was provided in whole or part from the proceeds of any tax-exempt qualified mortgage bond, or (ii) any credit was allowed under section 25 (relating to interest on certain home mortgages) to the taxpayer for interest paid or incurred on such indebtedness. (B) Exception for home improvement loans Such term shall not include any indebtedness to the extent such indebtedness is federally-subsidized indebtedness solely by reason of being a qualified home improvement loan (as defined in subsection (k)(4)).

“high housing cost area” applies in that section

the term “high housing cost area” means any statistical area for which the housing cost/income ratio is greater than 1.2. (D) Housing cost/income ratio For purposes of this paragraph— (i) In general

“holding period percentage” applies in that section

The term “holding period percentage” means the percentage determined in accordance with the following table: If the disposition occurs during a year after the testing date which is: The holding period percentage is: The 1st such year 20 The 2d such year 40 The 3d such year 60 The 4th such year 80 The 5th such year 100 The 6th such year 80 The 7th such year 60 The 8th such year 40 The 9th such year 20.

“housing cost/income ratio” applies in that section

The term “housing cost/income ratio” means, with respect to any statistical area, the number determined by dividing— (I) the applicable housing price ratio for such area, by (II) the ratio which the area median gross income for such area bears to the median gross income for the United States. (ii) Applicable housing price ratio For purposes of clause (i), the applicable housing price ratio for any area is the new housing price ratio or the existing housing price ratio, whichever results in the housing cost/income ratio being closer to 1.

“income percentage” applies in that section

The term “income percentage” means the percentage (but not greater than 100 percent) which— (i) the excess of— (I) the modified adjusted gross income of the taxpayer for the taxable year in which the disposition occurs, over (II) the adjusted qualifying income for such taxable year, bears to (ii) $5,000. The percentage determined under the preceding sentence shall be rounded to the nearest whole percentage point (or, if it includes a half of a percentage point, shall be increased to the nearest whole percentage point). (5) Adjusted qualifying income; modified adjusted gross income (A) Adjusted qualifying income For purposes of paragraph (4),

“limited equity cooperative housing” applies in that section

the term “limited equity cooperative housing” means any dwelling unit which a person is entitled to occupy by reason of his ownership of stock in a qualified cooperative housing corporation. (D) Qualified cooperative housing corporation For purposes of this paragraph,

“metropolitan statistical area” applies in that section

The term “metropolitan statistical area” includes the area defined as such by the Secretary of Commerce. (C) Designation where adequate statistical information not available For purposes of this paragraph, if there is insufficient recent statistical information with respect to a county (or portion thereof) described in subparagraph (A)(ii), the Secretary may substitute for such county (or portion thereof) another area for which there is sufficient recent statistical information.

“modified adjusted gross income” applies in that section

the term “modified adjusted gross income” means adjusted gross income— (i) increased by the amount of interest received or accrued by the taxpayer during the taxable year which is excluded from gross income under section 103, and (ii) decreased by the amount of gain (if any) included in gross income of the taxpayer by reason of the disposition to which this subsection applies.

“mortgage” applies in that section

The term “mortgage” means any owner-financing. (2) Statistical area (A) In general

“nonpurpose investment” applies in that section

the term “nonpurpose investment” has the meaning given such term by section 148(f)(6)(A). (h) Portion of loans required to be placed in targeted areas (1) In general An issue meets the requirements of this subsection only if at least 20 percent of the proceeds of the issue which are devoted to providing owner-financing is made available (with reasonable diligence) for owner-financing of targeted area residences for at least 1 year after the date on which owner-financing is first made available with respect to targeted area residences.

“qualified census tract” applies in that section

the term “qualified census tract” means a census tract in which 70 percent or more of the families have income which is 80 percent or less of the statewide median family income. (B) Data used The determination under subparagraph (A) shall be made on the basis of the most recent decennial census for which data are available. (3) Area of chronic economic distress (A) In general For purposes of paragraph (1),

“qualified cooperative housing corporation” applies in that section

the term “qualified cooperative housing corporation” means any cooperative housing corporation (as defined in section 216(b)(1)) if— (i) the consideration paid for stock held by any stockholder entitled to occupy any house or apartment in a building owned or leased by the corporation may not exceed the sum of— (I) the consideration paid for such stock by the first such stockholder, as adjusted by a cost-of-living adjustment determined by the Secretary, (II) payments made by any stockholder for improvements to such house or apartment, and (III) payments (other than amounts taken into account under subclause (I) or (II)) attributable to any stockholder to amortize the principal of the …

“qualified home improvement loan” applies in that section

The term “qualified home improvement loan” means the financing (in an amount which does not exceed $15,000)— (A) of alterations, repairs, and improvements on or in connection with an existing residence by the owner thereof, but (B) only of such items as substantially protect or improve the basic livability or energy efficiency of the property. (5) Qualified rehabilitation loan (A) In general

“qualified mortgage bond” applies throughout this title

the term “qualified mortgage bond” means a bond which is issued as part of a qualified mortgage issue. (2) Qualified mortgage issue defined (A) Definition For purposes of this title,

“qualified mortgage issue” applies throughout this title

the term “qualified mortgage issue” means an issue by a State or political subdivision thereof of 1 or more bonds, but only if— (i) all proceeds of such issue (exclusive of issuance costs and a reasonably required reserve) are to be used to finance owner-occupied residences, (ii) such issue meets the requirements of subsections (c), (d), (e), (f), (g), (h), (i), and (m)(7), (iii) such issue does not meet the private business tests of paragraphs (1) and (2) of section 141(b), and (iv) except as provided in subparagraph (D)(ii), repayments of principal on financing provided by the issue are used not later than the close of the 1st semiannual period beginning after the date the prepayment (or …

“qualified program” applies in that section

the term “qualified program” means any governmental program providing mortgage loans (other than 1st mortgage loans) or grants— (i) which restricts (throughout the 9-year period beginning on the date the financing is provided) the resale of the residence to a purchaser qualifying under this section and to a price determined by an index that reflects less than the full amount of any appreciation in the residence’s value, or (ii) which provides for deferred or reduced interest payments on such financing and grants the governmental unit a share in the appreciation of the residence, but only if such financing is not provided directly or indirectly through the use of any tax-exempt private …

“qualified rehabilitation” applies in that section

the term “qualified rehabilitation” means any rehabilitation of a building if— (i) there is a period of at least 20 years between the date on which the building was first used and the date on which the physical work on such rehabilitation begins, (ii) in the rehabilitation process— (I) 50 percent or more of the existing external walls of such building are retained in place as external walls, (II) 75 percent or more of the existing external walls of such building are retained in place as internal or external walls, and (III) 75 percent or more of the existing internal structural framework of such building is retained in place, and (iii) the expenditures for such rehabilitation are 25 percent …

“qualified rehabilitation loan” applies in that section

The term “qualified rehabilitation loan” means any owner-financing provided in connection with— (i) a qualified rehabilitation, or (ii) the acquisition of a residence with respect to which there has been a qualified rehabilitation, but only if the mortgagor to whom such financing is provided is the first resident of the residence after the completion of the rehabilitation. (B) Qualified rehabilitation For purposes of subparagraph (A),

“qualified subprime loan” applies in that section

The term “qualified subprime loan” means an adjustable rate single-family residential mortgage loan made after December 31, 2001 , and before January 1, 2008 , that the bond issuer determines would be reasonably likely to cause financial hardship to the borrower if not refinanced. (D) Termination This paragraph shall not apply to any bonds issued after December 31, 2010 .

“qualified veteran” applies in that section

the term “qualified veteran” means any veteran who— (A) served on active duty, and (B) applied for the financing before the date 25 years after the last date on which such veteran left active service. (5) Special rule for certain short-term bonds In the case of any bond— (A) which has a term of 1 year or less, (B) which is authorized to be issued under O.R.S. 407.435 (as in effect on the date of the enactment of this subsection), to provide financing for property taxes, and (C) which is redeemed at the end of such term, the amount taken into account under this subsection with respect to such bond shall be 1 ⁄ 15 of its principal amount.