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Hagel Bill Would Exclude Loan Interest on Agricultural Property

JUN. 13, 2003

S7876, S7881-S7882

DATED JUN. 13, 2003
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Citations: S7876, S7881-S7882

Rural Economic Investment Act of 2003

By Mr. HAGEL:

S. 1263. A bill to amend the Internal Revenue Code of 1986 to exclude from gross income interest received on loans secured by agricultural real property; to the Committee on Finance.

Mr. HAGEL. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

There being no objection, the bill was ordered to be printed in the Record, as follows:

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the "Rural Economic Investment Act of 2003".

 

SEC. 2. EXCLUSION FOR INTEREST ON LOANS SECURED BY AGRICULTURAL REAL PROPERTY.

 

(a) IN GENERAL. -- Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to items specifically excluded from gross income) is amended by inserting after section 132 the following new section:

"SEC. 133. INTEREST ON LOANS SECURED BY AGRICULTURAL REAL PROPERTY.

"(a) EXCLUSION. -- Gross income shall not include interest received by a qualified lender on any qualified real estate loan.

"(b) DEFINITIONS. -- For purposes of this section --

"(1) QUALIFIED LENDER. -- The term 'qualified lender' means 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) QUALIFIED REAL ESTATE LOAN. -- The term 'qualified real estate loan' means any loan secured by agricultural real estate or by a leasehold mortgage (with a status as a lien) on agricultural real estate.

"(3) AGRICULTURAL REAL ESTATE. -- The term 'agricultural real estate' means --

"(A) real property used for the production of 1 or more agricultural products, and

"(B) any single family residence --

"(i) which is the principal residence (within the meaning of section 121) of its occupant, and

"(ii) which is located in a rural area (as determined by the Secretary of Agriculture) with a population (determined on the basis of the most recent decennial census for which data are available) of 2,500 or less.".

(b) CLERICAL AMENDMENT. -- The table of sections for such part III is amended by inserting after the item relating to section 132 the following new item:

"Sec. 133. Interest on loans secured by agricultural real property.".

(c) EFFECTIVE DATE. -- The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.

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