This bill, the Shared Home Appreciation for Residential Equity (SHARE) Act, adds a new section to the tax code. It says certain amounts received by a lender from a "shared appreciation mortgage" are not included in the lender's gross income. The exclusion applies when the borrower’s income did not exceed 140 percent of the area median income for the census tract in the year the loan was made, and the property was the borrower’s principal residence. The bill also excludes any gain from selling a capital asset that is made up of or secured by those mortgages. The bill defines a shared appreciation mortgage as a second lien on a 1–4 unit home that: (1) gives the lender a predetermined share of the home’s net appreciation not larger than the share equal to the mortgage amount divided by the purchase price; (2) requires no payments other than the appreciation share; (3) is no more than 49 percent of the purchase price; (4) is subordinate to a first lien that meets a specified "qualified mortgage" definition under the Truth in Lending Act; and (5) does not require earlier repayment except in listed situations (for example, sale of the property or default). The changes apply to amounts received after December 31, 2025.
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