No Tax on Takings Act

Lower taxes for property owners after takings

If enacted, you would be able to exclude from gross income any gain when U.S. property you own is taken by eminent domain. This includes sales or exchanges made under threat or imminence of a taking. The bill would say the usual involuntary-conversion rules in section 1033 do not apply to these conversions. You could elect not to use the exclusion for a specific conversion if you do so at the time and in the manner the Treasury requires. The Secretary of the Treasury would be directed to issue regulations or guidance. The exclusion would apply to conversions in taxable years ending after the date of enactment. This could lower or eliminate the tax you owe when the payment is more than your property basis.