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Congressional Research Service
Version 00 · Introduced in House · Feb 6, 2025
Incentivizing Readiness and Environmental Protection Integration Sales Act of 2025
This bill excludes the gain from the sale of a qualified real property interest under the Readiness and Environmental Protection Integration (REPI) Program from gross income for federal tax purposes. (Some limitations apply.)
As background, the REPI Program supports cost-sharing agreements between the Armed Forces, other federal agencies, state and local governments, and certain private organizations to address land use near military installations, address environmental restrictions that limit military activities, and increase military installation resilience.
Showing the opening paragraphs of the official summary.
Under the bill, the exclusion from gross income applies to gain from the sale of a real property interest (pursuant to an agreement under the REPI Program) to
a state or U.S. possession (or a political subdivision of a state or U.S. possession) or the District of Columbia;
the United States;
certain corporations, trusts, community chest, funds, or foundations; or
certain charitable organizations.
Further, under the bill, the real property interest that is sold may be (1) the entire interest in the real property, (2) a remainder interest in the real property, or (3) a restriction on the use of the real property (e.g., easement) that is granted in perpetuity and created under state law.
However, the bill limits such exclusion from gross income for a partnership or other pass-through entity (other than a family partnership or family pass-through entity) to gain from the sale of a real property interest that is held for at least three years.
People & committees
Rep. Murphy, Gregory F. [R-NC-3] · R–NC
Legislative record
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Referred to the House Committee on Ways and Means.
Introduced in House
Introduced in House
Primary sources
Text links open the official source. We also preserved the text version used in the PlainBill explanation below.
Source last updated: Oct 14, 2026. Consult Congress.gov for the current record.
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PlainBill explanation
Based on the full Introduced in House · 2025-02-06 text. This explanation has not received human editorial review. This overview describes the proposal’s major provisions; it does not establish what its real-world effects would be.
This bill would exclude gains—profits for tax purposes—from gross income when sellers transfer qualifying land or property rights to eligible organizations under the Department of Defense’s Readiness and Environmental Protection Integration (REPI) program. Businesses whose income passes through to their owners would generally face a three-year restriction on recently purchased interests, with a family-ownership exception. These are proposed tax changes.
Gross income shall not include any gain from the sale of qualified real property interest to a qualified organization for REPI purposes.
A sale of qualified real property interest shall be treated as being for REPI purposes if such sale is pursuant to the authority of the Readiness and Environmental Protection Integration (REPI) program administered by the Department of Defense under section 2684a of title 10, United States Code.
In the case of a pass-through entity, no amount shall be excluded from gross income under subsection (a) with respect to a sale if such entity acquired the qualified real property interest by sale within 3 years of the date of the sale described in subsection (a).
Paragraph (1) shall not apply with respect to any sale made by any partnership if substantially all of the partnership interests in such partnership are held, directly or indirectly, by an individual and members of the family of such individual.
Section 1 would name the legislation the Incentivizing Readiness and Environmental Protection Integration Sales Act of 2025.
This Act may be cited as the Incentivizing Readiness and Environmental Protection Integration Sales Act of 2025.
Section 2 would add Internal Revenue Code section 139J. Its exclusion would cover gains from qualifying sales, with eligible buyers defined by an existing tax-code provision and eligible purposes tied to the Department of Defense’s REPI authority.
Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 139I the following new section: 139J.
Gross income shall not include any gain from the sale of qualified real property interest to a qualified organization for REPI purposes.
The term qualified organization has the meaning given such term by section 170(h)(3).
A sale of qualified real property interest shall be treated as being for REPI purposes if such sale is pursuant to the authority of the Readiness and Environmental Protection Integration (REPI) program administered by the Department of Defense under section 2684a of title 10, United States Code.
Eligible property rights would include the seller’s entire interest, a remainder interest—a right to property after a preceding interest ends—or a permanent restriction on property use created under state property law.
The term qualified real property interest means any of the following interests in real property: (i) The entire interest of the taxpayer. (ii) A remainder interest. (iii) A restriction (granted in perpetuity and created pursuant to State real property law) on the use which may be made of the real property.
Keeping a qualified mineral interest would not, by itself, disqualify a property interest. This protection would apply only if access to the mineral interest does not use any surface-mining method. The bill incorporates an existing statutory definition of qualified mineral interests.
An interest in real property shall not fail to be treated as a qualified real property interest solely by reason of a retention of a qualified mineral interest (as defined in section 170(h)(6)), but only if the right to access such mineral interest is not accomplished by any surface mining method.
A pass-through entity, whose income generally passes to its owners for tax purposes, would be denied the exclusion if it purchased the property interest within three years before the qualifying sale. The restriction specifically concerns interests acquired by sale.
In the case of a pass-through entity, no amount shall be excluded from gross income under subsection (a) with respect to a sale if such entity acquired the qualified real property interest by sale within 3 years of the date of the sale described in subsection (a).
The three-year restriction would not apply to a partnership if substantially all its ownership interests are held, directly or indirectly, by an individual and that individual’s family. Family would include a spouse and relatives specified in an existing tax-code provision. The bill does not give a numerical threshold for “substantially all.”
Paragraph (1) shall not apply with respect to any sale made by any partnership if substantially all of the partnership interests in such partnership are held, directly or indirectly, by an individual and members of the family of such individual.
the term members of the family means, with respect to any individual— (i) the spouse of such individual, and (ii) any individual who bears a relationship to such individual which is described in subparagraphs (A) through (G) of section 152(d)(2).
The family-ownership exception would also apply to S corporations and other entities whose income passes through to owners, using the partnership rules, except as the Secretary may otherwise provide.
Except as may be otherwise provided by the Secretary, the rules of this paragraph shall apply to S corporations and other pass-through entities in the same manner as such rules apply to partnerships.
The amendments would apply to tax years beginning after enactment. The supplied text specifies no expiration date.
The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.
The supplied actions snapshot, updated October 14, 2026, records introduction in the House and referral to the House Committee on Ways and Means on February 6, 2025.
Source snapshot updated 2026-10-14T08:05:29Z. 2025-02-06: Referred to the House Committee on Ways and Means. 2025-02-06: Introduced in House
A closer look
Reviewed version: Introduced in House · 2025-02-06. These findings describe provisions and who may benefit; they are not judgments of waste, corruption, or motive.
This review covers the supplied bill text. “None identified” does not rule out provisions in later versions or accompanying reports and disclosures.
Provisions outside the bill’s main subject, or policy changes attached to appropriations.
None identified in the reviewed text
No unrelated provision or policy change attached to appropriations was identified in the complete supplied introduced text. This conclusion is limited to that version and does not establish the contents of other versions or accompanying materials.
Spending directed to particular recipients or places outside ordinary competitive or formula-based allocation.
None identified in the reviewed text
No congressionally directed spending for particular recipients or places was identified in the complete supplied introduced text. This conclusion is limited to that version; formal earmark disclosures and accompanying materials are absent.
Narrow exceptions, exemptions, or preferential treatment that warrant a closer look.
Findings to examine
The supplied text contains narrow exceptions within the proposed tax exclusion. Classification identifies preferential treatment, not a judgment about its justification.
Qualifying family-owned partnerships would receive an exception from the three-year restriction that otherwise applies to pass-through entities. The exception would extend to S corporations and other pass-through entities unless the Secretary provides otherwise.
In the case of a pass-through entity, no amount shall be excluded from gross income under subsection (a) with respect to a sale if such entity acquired the qualified real property interest by sale within 3 years of the date of the sale described in subsection (a).
Paragraph (1) shall not apply with respect to any sale made by any partnership if substantially all of the partnership interests in such partnership are held, directly or indirectly, by an individual and members of the family of such individual.
Except as may be otherwise provided by the Secretary, the rules of this paragraph shall apply to S corporations and other pass-through entities in the same manner as such rules apply to partnerships.
Sellers retaining qualified mineral interests would receive a special eligibility protection: retention alone would not disqualify the property interest from the proposed exclusion, provided access to the minerals does not use surface mining. Other qualification requirements would still apply.
An interest in real property shall not fail to be treated as a qualified real property interest solely by reason of a retention of a qualified mineral interest (as defined in section 170(h)(6)), but only if the right to access such mineral interest is not accomplished by any surface mining method.
Gross income shall not include any gain from the sale of qualified real property interest to a qualified organization for REPI purposes.
Full text preserved for this analysis. Legislative record snapshot: Oct 14, 2026. How PlainBill uses AI