What does Preamble of LIFT Act do?

This bill aims to amend the Internal Revenue Code of 1986 The amendment provides a credit for American infrastructure bonds The bill has other purposes beyond the infrastructure bond credit

What does SHORT TITLE. of LIFT Act do?

This bill is formally titled the Local Infrastructure Financing Tools Act, also known as the LIFT Act.

What does CREDIT TO ISSUER FOR CERTAIN INFRASTRUCTURE BONDS. of LIFT Act do?

This section amends the Internal Revenue Code of 1986 to allow a credit to issuers of American infrastructure bonds. The credit is payable by the Secretary with each interest payment on the bond. The applicable percentage of the credit varies by calendar year, ranging from 42% to 30%. The bond must meet certain requirements, including 100% of proceeds used for capital expenditures or operations and maintenance. The issuer must make an irrevocable election to have this section apply prior to the bond's issuance.

What does ADVANCE REFUNDING BONDS. of LIFT Act do?

This section amends Section 149(d) of the Internal Revenue Code of 1986 regarding advance refunding bonds. It establishes new rules for advance refunding, including distinctions based on when the original bond was issued (before or after 1985). Specific conditions apply to advance refunding, such as redemption timelines and limitations on higher-yielding investments. The amendments prohibit abusive transactions designed to obtain a material financial advantage through arbitrage. Special rules are outlined for bonds issued before October 22, 1986, concerning advance refunding timelines. A conforming amendment is made to Section 148(f)(4)(C) of the Internal Revenue Code. The amendments apply to advance refunding bonds issued more than 30 days after the date of enactment of this Act.

What does PERMANENT MODIFICATION OF SMALL ISSUER EXCEPTION TO TAX-EXEMPT of LIFT Act do?

This section modifies the small issuer exception to tax-exempt interest expense allocation rules for financial institutions. The limitation is increased from $10,000,000 to $30,000,000 in certain sections of the Internal Revenue Code. Other special rules are modified, including the treatment of qualified 501(c)(3) bonds and qualified financings. An inflation adjustment is added for calendar years after 2026. The amendments apply to obligations issued after the date of the enactment of this Act.

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LIFT Act

Last updated: 5/15/2026 · Introduced: 5/15/2026

Author: Terri Sewell (D-AL)

TL;DR (AI)

The bill provides a credit to issuers of American infrastructure bonds, with the credit payable by the Secretary with each interest payment on the bond.
The bill establishes new rules for advance refunding bonds, including distinctions based on when the original bond was issued and prohibitions on abusive transactions designed to obtain a material financial advantage through arbitrage.
The bill modifies the small issuer exception to tax-exempt interest expense allocation rules for financial institutions, increasing the limitation from $10,000,000 to $30,000,000 and adding an inflation adjustment for calendar years after 2026.

119th Congressin committeeHR. 1255(In Committee)Official page

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Other Sections

Includes provisions on preamble, short title., and 3 more.

5 sections

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