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Title 12, Banks and BankingRelease 119-73not60

§1748h–3 Payments in Lieu of Taxes; Limitations; Exemption From Taxation

Title 12 › Chapter 13— NATIONAL HOUSING › Subchapter VIII— ARMED SERVICES HOUSING MORTGAGE INSURANCE › § 1748h–3

Last updated Apr 3, 2026|Official source

Summary

The Secretary can pay local governments instead of paying property taxes for real property he owns outright that he got under section 1748b as that section was before August 11, 1955. These payments can cover tax years before or after October 5, 1962. Payments cannot be higher than the tax on similar property and must not include interest or penalties. If the Secretary got the property by foreclosure or transfer from another federal agency during a tax year, the payment can be prorated for the rest of that year. These rules do not create any lien on Secretary‑owned property, and they do not allow payments for taxes when the Secretary is only a lessee or mortgagee. Property the Secretary acquires and holds under sections 1748h–1 or 1748h–2 is not exempt from state or local taxes; it is taxed the same as other property based on its value.

Full Legal Text

Title 12, §1748h–3

Banks and Banking, Source: USLM XML via OLRC

(a)The Secretary is authorized to make payments in lieu of taxes on any real property to which title has been or is hereafter acquired by him in fee under section 1748b of this title as effective prior to August 11, 1955, and on which taxes or payments in lieu of such taxes were payable or paid prior to acquisition by the Secretary. Such payments may be made in connection with tax years occurring prior to or subsequent to October 5, 1962. The amount of any such payments shall not exceed taxes on similar property and shall not include interest or penalties. If the Secretary has acquired or hereafter acquires title in fee to real property by foreclosure or by transfer from some other department or agency of the Government or otherwise during a tax year, he may make a payment in lieu of taxes prorated for that portion of the year remaining after his acquisition of title. This subsection shall not authorize any lien against property held by the Secretary, nor the payment of any tax, nor any payment in lieu of any tax, on any interest of the Secretary as lessee or mortgagee.
(b)Nothing in this subchapter shall be construed to exempt any real property which has been or is hereafter acquired and held by the Secretary under section 1748h–1 or 1748h–2 of this title from taxation by any State or political subdivision thereof, to the same extent, according to its value, as other real property is taxed.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

Amendments

1967—Subsecs. (a), (b). Pub. L. 90–19 substituted “Secretary” for “Commissioner” wherever appearing.

Reference

Citations & Metadata

Citation

12 U.S.C. § 1748h–3

Title 12, Banks and Banking

Last Updated

Apr 3, 2026

Release point: 119-73not60