S. 1687 modifies tax accounting rules for residential construction projects, specifically expanding an existing exemption that previously applied only to single-family home construction to also cover condominium and other multi-unit residential construction contracts. Under current law, most construction companies must use the "percentage of completion" method to report income as projects progress; this bill allows certain residential construction contractors to use an alternative accounting method, but extends the required project completion timeline from two years to three years for condominium and other non-home residential construction. The change affects construction companies and developers who build residential properties, potentially allowing them more flexibility in how and when they report income for tax purposes. The law applies to contracts signed after the bill is enacted, with no specific funding requirements mentioned since this is a tax code change rather than a spending measure.
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