Make the American Dream Real Again Act
- Sponsor
- Rep. Burlison, Eric [R-MO-7]
- Committees
- Ways and Means Committee (primary)
- Last action
- May 7, 2026
Bottom line
This bill creates a refundable tax credit to encourage sellers to subsidize home acquisition costs for first-time homebuyers, potentially stimulating the housing market and aiding new homeowners.
What it actually does
This bill establishes a new refundable tax credit for individuals who sell their principal residence to a first-time homebuyer. The credit amount is capped at the lesser of the qualified home acquisition expenses (like down payments and closing costs) paid by the seller on behalf of the buyer, or the tax liability reduction achieved by excluding the gain from the sale of the principal residence from gross income. This aims to incentivize sellers to assist first-time homebuyers with their acquisition costs.
Proponents argue
Supporters would argue that this bill directly addresses the affordability crisis faced by first-time homebuyers by providing a tangible incentive for sellers to reduce upfront costs like down payments and closing fees. They would contend that it helps "make the American Dream real again" by making homeownership more accessible, especially for younger generations or those with limited savings, and could stimulate housing market activity.
Opponents contend
Opponents might argue that while well-intentioned, this credit could inadvertently inflate housing prices by increasing demand without addressing underlying supply issues, or that it primarily benefits sellers who can afford to offer such subsidies. Critics might also raise concerns about the significant federal revenue cost of a refundable credit and question its effectiveness in genuinely improving long-term affordability for those most in need, suggesting it could be a regressive subsidy.
The bill is very short and can be read quickly, allowing ample time for detailed consideration of its implications.
Section 2(a), inserting new section 36C into the Internal Revenue Code of 1986.
Refundable Credit for Qualified Home Acquisition Expenses
This provision establishes a new tax credit for individuals who sell their primary home to someone buying their first home. The seller can claim a credit for the costs they pay towards the first-time homebuyer's expenses, such as down payments, inspection fees, and closing costs. The credit is limited to either the actual amount of these expenses paid by the seller or the amount of tax savings the seller would get if they didn't have to pay taxes on the profit from selling their home, whichever is less.
Supporters argue
Proponents argue this credit directly addresses the significant barrier of upfront costs for first-time homebuyers, making homeownership more attainable. They contend it leverages existing housing stock by incentivizing current homeowners to sell and assist new buyers, thereby stimulating market activity.
Critics contend
Opponents might argue that this credit could primarily benefit wealthier sellers who have the capital to front these expenses, and that it may not significantly help the most financially vulnerable first-time homebuyers. They could also suggest it might contribute to housing price inflation by increasing demand without addressing supply.
Tradeoffs
The bill balances the goal of increasing homeownership accessibility for first-time buyers against potential federal revenue loss and the risk of inadvertently contributing to housing price increases or primarily benefiting more affluent market participants.