HB1822, the Access to Credit for our Rural Economy Act of 2025 (ACRE Act of 2025), would amend the Internal Revenue Code to exclude from gross income interest received by certain qualified lenders on qualifying real estate loans secured by rural or agricultural real property. In practical terms, the bill creates a new tax exemption for interest earned on loans tied to farmland, rural principal residences, forestland, fishing and seafood-processing property, and aquaculture facilities, subject to specified eligibility rules.
The bill defines which lenders can benefit, including FDIC-insured banks and savings associations, regulated insurance companies, certain bank- and insurance-holding-company affiliates, and, for some loans, federally chartered Farm Credit System instrumentalities. It also limits the exemption to loans made after enactment, includes rules for refinancings, and excludes loans made to foreign adversary entities. For certain rural single-family residences, the loan principal must not exceed $750,000. The bill also directs the Treasury Department to report to Congress within five years on the law’s effect on qualified real estate loans and whether it reduced interest rates.
If enacted, the bill would add a new section 139J to the Internal Revenue Code and conform related tax provisions so that qualifying interest income is treated as exempt from federal income tax. That would affect lenders rather than borrowers directly, but the policy goal is to lower borrowing costs and improve credit availability in rural and agricultural markets by making these loans more attractive to lenders. The bill would also create new statutory definitions for rural or agricultural real estate, aquaculture facilities, and foreign adversary entities, and it would apply to taxable years ending after enactment.
Available context suggests generally favorable treatment of the bill, or at least no recorded opposition in the provided materials. The bill was introduced by Representatives Feenstra, Davis of North Carolina, and Moran and referred to the House Committee on Ways and Means, with no committee transcript or vote record included here. The title and structure indicate a pro-rural-credit, pro-agriculture policy approach intended to support lending in rural communities.
The main policy questions likely concern the scope and fiscal effect of the tax exemption, including whether exempting lender interest income will meaningfully reduce borrowing costs for farmers, rural homeowners, and aquaculture or seafood businesses. Another possible point of contention is the bill’s eligibility design: it favors certain regulated financial institutions, excludes loans to foreign adversary entities, and sets a $750,000 cap for some rural residence loans, which may draw scrutiny over fairness, administrative complexity, and who benefits most. No specific objections or amendments are reflected in the provided discussion record.