SECTION 1. EXCLUSION FROM ESTATE TAX FOR HISTORIC PROPERTY SUBJECT TO 
              PRESERVATION EASEMENT.

    (a) In General.--Part IV of subchapter A of chapter 11 of the 
Internal Revenue of 1986 (relating to taxable estate) is amended by 
adding at the end the following new section:

``SEC. 2057. QUALIFIED HISTORIC PROPERTY.

    ``(a) General Rule.--For purposes of the tax imposed by section 
2001, the value of the taxable estate shall be determined by deducting 
from the value of the gross estate an amount equal to the value of any 
qualified historic property included in the gross estate.
    ``(b) Definitions.--For purposes of this section--
            ``(1) Qualified historic property.--
                    ``(A) In general.--The term `qualified historic 
                property' means any historic property if--
                            ``(i) on or before the date on which the 
                        return of the tax imposed by section 2001 is 
                        filed, a qualified real property interest 
                        described in section 170(h)(2)(C) in such 
                        property is held by a qualified organization 
                        for the purpose described in section 
                        170(h)(4)(A)(iv), and
                            ``(ii) such property is covered by an 
                        agreement meeting the requirements of 
                        subsection (c) which is entered into on or 
                        before such date.
                    ``(B) Treatment of personal property.--Such term 
                includes personal property included within, or 
                associated with, qualified historic property (as 
                defined in paragraph (1)) if such personal property--
                            ``(i) is held by the decedent holding such 
                        qualified historic property,
                            ``(ii) has been so included within, or 
                        associated with, such qualified historic 
                        property throughout the 10-year period ending 
                        on the date of the decedent's death, and
                            ``(iii) is covered by the agreement 
                        referred to in subparagraph (A)(ii) which 
                        covers such qualified historic property.
            ``(2) Historic property.--The term `historic property' 
        means--
                    ``(A) any building (and its structural 
                components)--
                            ``(i) which is designated as a National 
                        Historic Landmark under section 101 of the 
                        National Historic Preservation Act throughout 
                        the 10-year period ending on the date of the 
                        decedent's death,
                            ``(ii) which was owned by the decedent or a 
                        member of the decedent's family (as defined in 
                        section 2032A(e)(2)) throughout such 10-year 
                        period, and
                            ``(iii) which was originally used for 
                        residential purposes, and
                    ``(B) any other real property to the extent 
                reasonably necessary for public view and visitation of 
                the property described in subparagraph (A).
            ``(3) Qualified organization.--The term `qualified 
        organization' has the meaning given to such term by section 
        170(h)(3).
            ``(4) Treatment of qualified historic property held by a 
        corporation.--In the case of a corporation all of the stock in 
        which was held on the date of the decedent's death by the 
        decedent or members of the decedent's family (as defined in 
        section 2032A(e)(2))--
                    ``(A) stock in such corporation shall be treated 
                for purposes of this section as qualified historic 
                property to the extent that the value of such stock is 
                attributable to qualified historic property held by 
                such corporation, but
                    ``(B) the requirements of subsection (c) shall be 
                met only if each member of the decedent's family 
                holding such stock on such date sign the agreement 
                referred to in subsection (c).
    ``(c) Requirements for Agreement.--
            ``(1) In general.--For purposes of subsection 
        (b)(1)(A)(ii), an agreement meets the requirements of this 
        subsection if--
                    ``(A) such agreement is a written agreement signed 
                by each person in being who has an interest (whether or 
                not in possession) in the historic property (other than 
                the qualified organization),
                    ``(B) such agreement is entered into with a State 
                historic preservation agency (or similar State agency) 
                and filed with the Secretary with the return of the tax 
                imposed by section 2001,
                    ``(C) such agreement provides that the only 
                activities carried on at the historic property are 
                activities which are substantially related (aside from 
                the need for income or funds or the use made of the 
                profits derived) to--
                            ``(i) the public view and visitation of 
                        such property and the property described in the 
                        last sentence of subsection (b)(1) with respect 
                        to such property), and
                            ``(ii) the maintenance and preservation of 
                        such property and surrounding areas for such 
                        public view and visitation,
                    ``(D) such agreement provides that the historic 
                property will be open to the public for a period of at 
                least 20 years beginning on the date on which the 
                return of the tax imposed by section 2001 is filed, and
                    ``(E) such agreement provides that any admission 
                fees (if any) shall bear a reasonable relationship to 
                admission fees for other comparable tourist sites and 
                shall be approved by such State historic preservation 
                agency (or similar State agency).
            ``(2) Treatment of food, lodging, and meeting facilities 
        provided to general public.--The regular carrying on--
                    ``(A) a trade or business of providing lodging 
                shall be treated as not substantially related for 
                purposes of paragraph (1)(C),
                    ``(B) a trade or business of providing food shall 
                be treated as not substantially related for purposes of 
                paragraph (1)(C) unless--
                            ``(i) such food is only provided to 
                        individuals who pay the generally applicable 
                        admission fees (if any) for admission to the 
                        property by individuals to whom no food is 
                        provided, and
                            ``(ii) only an insubstantial portion of the 
                        structures on the historic property is devoted 
                        to the provision of such food, and
                    ``(C) a trade or business of providing facilities 
                for meetings or events shall be treated as not 
                substantially related for purposes of paragraph (1)(C) 
                unless all of the net proceeds from such trade or 
                business are used for maintenance or preservation of 
                the historic property.
            ``(3) Open to the public.--For the purposes of paragraph 
        (1)(D), the 20-year period referred to in such paragraph shall 
        be suspended during reasonable periods of renovation.
    ``(d) Tax Treatment of Dispositions and Failure To Comply With 
Agreement.--
            ``(1) Imposition of additional estate tax.--If, during the 
        20-year period referred to in subsection (c)(1)(D)--
                    ``(A) any person signing the written agreement 
                referred to in subsection (c) disposes of any interest 
                in the qualified historic property, or
                    ``(B) there is a violation of any provision of such 
                agreement (as determined under regulations prescribed 
                by the Secretary),
        then there is hereby imposed an additional estate tax.
            ``(2) Exception for certain transferees who agree to be 
        bound by agreement.--No tax shall be imposed under paragraph 
        (1) by reason of any disposition if the person acquiring the 
        property--
                    ``(A) is a qualified organization or is a member of 
                the family (as defined in section 2032A(e)(2)) of the 
                person disposing of such property, and
                    ``(B) agrees to be bound by the agreement referred 
                to in subsection (b)(4) and to be liable for any tax 
                under this subsection in the same manner as the person 
                disposing of such property.
            ``(3) Amount of additional tax.--
                    ``(A) In general.--The amount of the additional tax 
                imposed by paragraph (1) with respect to any property 
                shall be an amount equal to the applicable percentage 
                of the excess of--
                            ``(i) what would (but for subsection (a)) 
                        have been the tax imposed by section 2001 
(reduced by the credits allowable), over
                            ``(ii) the tax imposed by section 2001 (as 
                        so reduced).
                    ``(B) Applicable percentage.--For purposes of 
                subparagraph (A), the applicable percentage is the 
                percentage determined in accordance with the following 
                table for the year (of 20-year period referred to in 
                subsection (c)(1)(D)) in which the event described in 
                paragraph (1) occurs:

                ``If the event
                                                         The applicable
                occurs during:
                                                         percentage is:
                The 1st 12 years of such 20-year       100 percent     
                    period.
                The 13th or 14th year of such period.   80 percent     
                The 15th or 16th year of such period.   60 percent     
                The 17th or 18th year of such period.   40 percent     
                The 19th or 20th year of such period.   20 percent.    
            ``(4) Due date.--The additional tax imposed by this 
        subsection shall be due and payable on the day which is 6 
        months after the date of the disposition or violation referred 
        to in paragraph (1).
            ``(5) Liability for tax.--Any person signing the agreement 
        referred to in subsection (c) (other than the executor) shall 
        be personally liable for the additional tax imposed by this 
        subsection. If more than 1 person is liable under this 
        subsection, all such persons shall be jointly and severally 
        liable.
            ``(6) Certain other rules to apply.--Rules similar to the 
        rules of sections 1016(c), 2013(f), and 2032A(f) shall apply 
        for purposes of this subsection.
    ``(e) Other Special Rules.--
            ``(1) Coordination with deduction for transfer of 
        easement.--Section 2055(f) shall not apply to any interest 
        referred to therein with respect to property for which a 
        deduction is allowed under subsection (a).
            ``(2) Denial of deduction of indebtedness on excluded 
        property.--No deduction shall be allowed under section 2053 for 
        indebtedness in respect of property the value of which is 
        deducted under subsection (a).
            ``(3) Submission of annual inventories of personal 
        property.--The Secretary shall require the submission to the 
        Secretary of such inventories of personal property which is 
        qualified historic property as the Secretary determines are 
        necessary for purposes of this section.''
    (b) Technical Amendments.--
            (1) Subsection (a) of section 1014 of such Code is amended 
        by striking the period at the end of paragraph (3) and 
        inserting ``, or'' and by adding after paragraph (3) the 
        following new paragraph:
            ``(4) in the case of property the value of which was 
        deducted under section 2057(a), the adjusted basis of such 
        property in the hands of the decedent immediately before the 
        death of the decedent.''
            (2) Subparagraph (A) of section 2056A(b)(10) of such Code 
        is amended by inserting ``2057,'' after ``2056,''.
            (3) The table of sections for part IV of subchapter A of 
        chapter 11 of such Code is amended by adding at the end the 
        following new item:

                              ``Sec. 2057. Qualified historic 
                                        property.''
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to the estates of decedents dying after the date of 
the enactment of this Act.
Amends the Internal Revenue Code to provide that for purposes of determining estate tax the value of the taxable estate shall be determined by deducting from the value of the gross estate an amount equal to the value of any qualified historic property.  Defines qualified historic property.  Requires, among other things, that the historic property will be open to the public for a period of at least 20 years and will have reasonable admission fees.
{"src": "billsum_test", "title": "A bill to amend the Internal Revenue Code of 1986 to provide that the value of qualified historic property shall not be included in determining the taxable estate of a decedent."}