SHARE Act
- Sponsor
- Rep. Moore, Blake D. [R-UT-1]
- Committees
- Ways and Means Committee (primary)
- Last action
- Mar 26, 2026
Bottom line
The bill aims to incentivize lenders to offer shared appreciation mortgages to eligible moderate-income homeowners by making the appreciation share received by lenders tax-exempt.
What it actually does
This bill, known as the "SHARE Act," amends the Internal Revenue Code of 1986 to create a new tax exclusion for lenders. It excludes from a lender's gross income any amount received from a shared appreciation mortgage (SAM) that exceeds the original principal obligation, provided the borrower's income did not exceed 140% of the area median income and the property was their principal residence. It also excludes gains from the disposition of capital assets secured by such qualifying SAMs.
Proponents argue
Supporters argue this bill will expand access to homeownership for moderate-income individuals by making shared appreciation mortgages more attractive to lenders. By reducing the upfront costs and monthly payments for borrowers, while allowing lenders to participate in future home value appreciation, it creates a new, innovative financing option. This could particularly benefit those struggling with down payments or high interest rates, fostering greater housing affordability.
Opponents contend
Critics might contend that this tax exclusion primarily benefits financial institutions and investors rather than directly helping homeowners, as the tax savings accrue to the lender. They may also argue that it could encourage speculative lending practices or that the government is subsidizing a potentially risky financial product without sufficient safeguards for borrowers, or that it represents an unfair tax break that reduces federal revenue.
The bill is concise and its core provisions are clearly stated, making it accessible for a quick but informed review.
Section 2, inserting new section 139J into the Internal Revenue Code of 1986.
Exclusion of Certain Proceeds from Shared Appreciation Mortgage Contracts
This provision amends the tax code to exclude from a lender's gross income any amount received from a shared appreciation mortgage (SAM) that exceeds the original principal. This exclusion applies only if the borrower's income was no more than 140% of the area median income when the loan was issued, and the property was their principal residence. It also excludes gains from the disposition of capital assets secured by such qualifying SAMs. The bill defines a SAM as a second lien mortgage where the lender shares in property appreciation, the borrower makes no other payments on the SAM, the SAM amount is under 49% of the purchase price, and it's subordinate to a qualified first lien.
Supporters argue
Supporters argue this exclusion directly incentivizes lenders to offer shared appreciation mortgages, which can lower the barrier to entry for moderate-income individuals seeking to purchase a home. By making these innovative financial products more profitable for lenders, the bill aims to stimulate their availability in the market, thereby addressing housing affordability.
Critics contend
Opponents might argue that while the intent is to help homebuyers, the direct financial benefit of the tax exclusion goes to lenders, not borrowers. They could contend that the market should determine the viability of such products without federal tax subsidies, and that this could lead to a loss of federal revenue without guaranteed benefits to the target demographic.
Tradeoffs
The bill balances the goal of expanding homeownership opportunities for moderate-income individuals against the cost of a federal tax expenditure and the potential for new financial risks associated with shared appreciation mortgages. It seeks to use tax incentives to foster a specific type of private market financing, but the extent to which benefits are passed to consumers is a key tension.
Defines a shared appreciation mortgage as being subordinate to a first lien that is a 'qualified mortgage' as defined under section 129C(c)(2) of the Truth in Lending Act.
Section 139J(b)(4)
Why it matters:This is standard legislative drafting practice to avoid redundancy and ensure consistency with existing legal definitions and consumer protection standards. It is not necessarily evasive, but it does require additional research for a complete understanding of the first lien's characteristics.
Case for: Supporters would argue that referencing existing definitions ensures consistency across federal law and leverages established consumer protections and lending standards already associated with 'qualified mortgages,' thereby providing a layer of safety for borrowers.
Case against: Critics might argue that relying on external definitions makes the bill less transparent and harder for the average person to understand without extensive legal research, potentially obscuring important details about the types of first liens that would qualify and the protections they offer.
Estimated impact: This reference ensures that the primary mortgage associated with a qualifying SAM adheres to specific underwriting standards and consumer protection rules, impacting the safety and soundness of the overall financing structure for potentially millions of mortgages.