HR 5486 IHCommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to provide tax incentives for small business job creation, and for other purposes.CommentsClose CommentsPermalink

June 9, 2010CommentsClose CommentsPermalink

Mr. LEVIN introduced the following bill; which was referred to the Committee on Ways and MeansCommentsClose CommentsPermalink

To amend the Internal Revenue Code of 1986 to provide tax incentives for small business job creation, and for other purposes.CommentsClose CommentsPermalink

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,CommentsClose CommentsPermalink

TITLE V--TAX PROVISIONSCommentsClose CommentsPermalink

SEC. 500. SHORT TITLE; ETC.

(a) Short Title- This title may be cited as the ‘Small Business Jobs Tax Relief Act of 2010’.CommentsClose CommentsPermalink





(b) Amendment of 1986 Code- Except as otherwise expressly provided, whenever in this title an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986.CommentsClose CommentsPermalink





(c) Table of Contents- The table of contents for this title is as follows:CommentsClose CommentsPermalink





Sec. 500. Short title; etc.CommentsClose CommentsPermalink

Subtitle A--Small Business Tax Incentives

Part 1--General Provisions

Sec. 501. Temporary exclusion of 100 percent of gain on certain small business stock.CommentsClose CommentsPermalink

Part 2--Limitations and Reporting on Certain Penalties

Sec. 511. Limitation on penalty for failure to disclose certain information.CommentsClose CommentsPermalink





Sec. 512. Annual reports on penalties and certain other enforcement actions.CommentsClose CommentsPermalink

Part 3--Other Provisions

Sec. 521. Increase in amount allowed as deduction for start-up expenditures.CommentsClose CommentsPermalink





Sec. 522. Nonrecourse small business investment company loans from the Small Business Administration treated as amounts at risk.CommentsClose CommentsPermalink





Sec. 523. Benefits under the Small Business Borrower Assistance Program excluded from gross income.CommentsClose CommentsPermalink

Subtitle B--Revenue Provisions

Sec. 531. Required minimum 10-year term, etc., for grantor retained annuity trusts.CommentsClose CommentsPermalink





Sec. 532. Crude tall oil ineligible for cellulosic biofuel producer credit.CommentsClose CommentsPermalink





Sec. 533. Time for payment of corporate estimated taxes.CommentsClose CommentsPermalink

Subtitle A--Small Business Tax IncentivesCommentsClose CommentsPermalink

PART 1--GENERAL PROVISIONS

SEC. 501. TEMPORARY EXCLUSION OF 100 PERCENT OF GAIN ON CERTAIN SMALL BUSINESS STOCK.

(a) In General- Subsection (a) of section 1202 is amended by adding at the end the following new paragraph:CommentsClose CommentsPermalink





‘(4) SPECIAL 100 PERCENT EXCLUSION- In the case of qualified small business stock acquired after March 15, 2010, and before January 1, 2012--CommentsClose CommentsPermalink





‘(A) paragraph (1) shall be applied by substituting ‘100 percent’ for ‘50 percent’,CommentsClose CommentsPermalink





‘(B) paragraph (2) shall not apply, andCommentsClose CommentsPermalink





‘(C) paragraph (7) of section 57(a) shall not apply.’.CommentsClose CommentsPermalink





(b) Conforming Amendments- Paragraph (3) of section 1202(a) is amended--CommentsClose CommentsPermalink





(1) by striking ‘after the date of the enactment of this paragraph and before January 1, 2011’ and inserting ‘after February 17, 2009, and before March 16, 2010’; andCommentsClose CommentsPermalink





(2) by striking ‘SPECIAL RULES FOR 2009 AND 2010’ in the heading and inserting ‘SPECIAL 75 PERCENT EXCLUSION’.CommentsClose CommentsPermalink





(c) Effective Date- The amendments made by this section shall apply to stock acquired after March 15, 2010.CommentsClose CommentsPermalink

PART 2--LIMITATIONS AND REPORTING ON CERTAIN PENALTIES

SEC. 511. LIMITATION ON PENALTY FOR FAILURE TO DISCLOSE CERTAIN INFORMATION.

(a) In General- Subsection (b) of section 6707A is amended to read as follows:CommentsClose CommentsPermalink





‘(b) Amount of Penalty-CommentsClose CommentsPermalink





‘(1) IN GENERAL- Except as otherwise provided in this subsection, the amount of the penalty under subsection (a) with respect to any reportable transaction shall be 75 percent of the decrease in tax shown on the return as a result of such transaction (or which would have resulted from such transaction if such transaction were respected for Federal tax purposes).CommentsClose CommentsPermalink





‘(2) MAXIMUM PENALTY- The amount of the penalty under subsection (a) with respect to any reportable transaction for any taxable year shall not exceed--CommentsClose CommentsPermalink





‘(A) in the case of a listed transaction, $200,000 ($100,000 in the case of a natural person), orCommentsClose CommentsPermalink





‘(B) in the case of any other reportable transaction, $50,000 ($10,000 in the case of a natural person).CommentsClose CommentsPermalink





‘(3) MINIMUM PENALTY- The amount of the penalty under subsection (a) with respect to any transaction for any taxable year shall not be less than $10,000 ($5,000 in the case of a natural person).’.CommentsClose CommentsPermalink





(b) Effective Date- The amendment made by this section shall apply to penalties assessed after December 31, 2006.CommentsClose CommentsPermalink

SEC. 512. ANNUAL REPORTS ON PENALTIES AND CERTAIN OTHER ENFORCEMENT ACTIONS.

(a) In General- The Commissioner of Internal Revenue, in consultation with the Secretary of the Treasury, shall submit to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate an annual report on the penalties assessed by the Internal Revenue Service during the preceding year under each of the following provisions of the Internal Revenue Code of 1986:CommentsClose CommentsPermalink





(1) Section 6662A (relating to accuracy-related penalty on understatements with respect to reportable transactions).CommentsClose CommentsPermalink





(2) Section 6700(a) (relating to promoting abusive tax shelters).CommentsClose CommentsPermalink





(3) Section 6707 (relating to failure to furnish information regarding reportable transactions).CommentsClose CommentsPermalink





(4) Section 6707A (relating to failure to include reportable transaction information with return).CommentsClose CommentsPermalink





(5) Section 6708 (relating to failure to maintain lists of advisees with respect to reportable transactions).CommentsClose CommentsPermalink





(b) Additional Information- The report required under subsection (a) shall also include information on the following with respect to each year:CommentsClose CommentsPermalink





(1) Any action taken under section 330(b) of title 31, United States Code, with respect to any reportable transaction (as defined in section 6707A(c) of the Internal Revenue Code of 1986).CommentsClose CommentsPermalink





(2) Any extension of the time for assessment of tax enforced, or assessment of any amount under such an extension, under paragraph (10) of section 6501(c) of the Internal Revenue Code of 1986.CommentsClose CommentsPermalink





(c) Date of Report- The first report required under subsection (a) shall be submitted not later than December 31, 2010.CommentsClose CommentsPermalink

PART 3--OTHER PROVISIONS

SEC. 521. INCREASE IN AMOUNT ALLOWED AS DEDUCTION FOR START-UP EXPENDITURES.

(a) In General- Subsection (b) of section 195 is amended by adding at the end the following new paragraph:CommentsClose CommentsPermalink





‘(3) INCREASED LIMITATION FOR TAXABLE YEARS BEGINNING IN 2010 OR 2011- In the case of any taxable year beginning in 2010 or 2011, paragraph (1)(A)(ii) shall be applied--CommentsClose CommentsPermalink





‘(A) by substituting ‘$20,000’ for ‘$5,000’, andCommentsClose CommentsPermalink





‘(B) by substituting ‘$75,000’ for ‘$50,000’.’.CommentsClose CommentsPermalink





(b) Effective Date- The amendments made by this section shall apply to taxable years beginning after December 31, 2009.CommentsClose CommentsPermalink

SEC. 522. NONRECOURSE SMALL BUSINESS INVESTMENT COMPANY LOANS FROM THE SMALL BUSINESS ADMINISTRATION TREATED AS AMOUNTS AT RISK.

(a) In General- Subparagraph (B) of section 465(b)(6) is amended to read as follows:CommentsClose CommentsPermalink





‘(B) QUALIFIED NONRECOURSE FINANCING- For purposes of this paragraph--CommentsClose CommentsPermalink





‘(i) IN GENERAL- The term ‘qualified nonrecourse financing’ means any financing--CommentsClose CommentsPermalink





‘(I) which is qualified real property financing or qualified SBIC financing,CommentsClose CommentsPermalink





‘(II) except to the extent provided in regulations, with respect to which no person is personally liable for repayment, andCommentsClose CommentsPermalink





‘(III) which is not convertible debt.CommentsClose CommentsPermalink





‘(ii) QUALIFIED REAL PROPERTY FINANCING- The term ‘qualified real property financing’ means any financing which--CommentsClose CommentsPermalink





‘(I) is borrowed by the taxpayer with respect to the activity of holding real property,CommentsClose CommentsPermalink





‘(II) is secured by real property used in such activity, andCommentsClose CommentsPermalink





‘(III) is borrowed by the taxpayer from a qualified person or represents a loan from any Federal, State, or local government or instrumentality thereof, or is guaranteed by any Federal, State, or local government.CommentsClose CommentsPermalink





‘(iii) QUALIFIED SBIC FINANCING- The term ‘qualified SBIC financing’ means any financing which--CommentsClose CommentsPermalink





‘(I) is borrowed by a small business investment company (within the meaning of section 301 of the Small Business Investment Act of 1958), andCommentsClose CommentsPermalink





‘(II) is borrowed from, or guaranteed by, the Small Business Administration under the authority of section 303(b) of such Act.’.CommentsClose CommentsPermalink





(b) Conforming Amendments- Subparagraph (A) of section 465(b)(6) is amended--CommentsClose CommentsPermalink





(1) by striking ‘in the case of an activity of holding real property,’; andCommentsClose CommentsPermalink





(2) by striking ‘which is secured by real property used in such activity’.CommentsClose CommentsPermalink





(c) Effective Date- The amendments made by this section shall apply to loans and guarantees made after the date of the enactment of this Act.CommentsClose CommentsPermalink

SEC. 523. BENEFITS UNDER THE SMALL BUSINESS BORROWER ASSISTANCE PROGRAM EXCLUDED FROM GROSS INCOME.

(a) In General- Part III of subchapter B of chapter 1 is amended by adding at the end the following new section:CommentsClose CommentsPermalink

‘SEC. 139F. BENEFITS UNDER THE SMALL BUSINESS BORROWER ASSISTANCE PROGRAM.

‘(a) In General- Gross income shall not include any amount paid on behalf of a borrower by the Administrator of the Small Business Administration under the Small Business Borrower Assistance program established under section 402 of the Small Business Assistance Fund Act of 2010 (as in effect immediately after the date of the enactment of such Act).CommentsClose CommentsPermalink





‘(b) Denial of Double Benefit- Notwithstanding any other provision of this subtitle, with respect to the person for whose benefit a payment described in subsection (a) is made--CommentsClose CommentsPermalink





‘(1) INTEREST- No deduction shall be allowed for interest to the extent the liability for such interest is covered by such payment.CommentsClose CommentsPermalink





‘(2) PAYMENTS OF PRINCIPAL- If any payment is applied to reduce the principal of the loan to which such payment relates--CommentsClose CommentsPermalink





‘(A) ALLOCATION AMONG FINANCED EXPENDITURES- Such payment shall be allocated pro rata among the expenditures financed with such loan.CommentsClose CommentsPermalink





‘(B) CREDITS AND DEDUCTIBLE EXPENSES- No deduction or credit shall be allowed for, or by reason of, any such expenditure to the extent of the amount of the payment allocated to such expenditure under subparagraph (A).CommentsClose CommentsPermalink





‘(C) ADJUSTMENT OF BASIS- The adjusted basis of any property acquired with such expenditure shall be reduced to the extent of the amount of the payment allocated to such expenditure under subparagraph (A).’.CommentsClose CommentsPermalink





(b) Clerical Amendments- The table of sections for part III of subchapter B of chapter 1 is amended by adding at the end the following new item:CommentsClose CommentsPermalink





‘Sec. 139F. Benefits under the Small Business Borrower Assistance Program.’.CommentsClose CommentsPermalink





(c) Effective Date- The amendments made by this section shall apply to payments made after the date of the enactment of this Act.CommentsClose CommentsPermalink

Subtitle B--Revenue ProvisionsCommentsClose CommentsPermalink

SEC. 531. REQUIRED MINIMUM 10-YEAR TERM, ETC., FOR GRANTOR RETAINED ANNUITY TRUSTS.

(a) In General- Subsection (b) of section 2702 is amended--CommentsClose CommentsPermalink





(1) by redesignating paragraphs (1), (2) and (3) as subparagraphs (A), (B), and (C), respectively, and by moving such subparagraphs (as so redesignated) 2 ems to the right;CommentsClose CommentsPermalink





(2) by striking ‘For purposes of’ and inserting the following:CommentsClose CommentsPermalink





‘(1) IN GENERAL- For purposes of’;CommentsClose CommentsPermalink





(3) by striking ‘paragraph (1) or (2)’ in paragraph (1)(C) (as so redesignated) and inserting ‘subparagraph (A) or (B)’; andCommentsClose CommentsPermalink





(4) by adding at the end the following new paragraph:CommentsClose CommentsPermalink





‘(2) ADDITIONAL REQUIREMENTS WITH RESPECT TO GRANTOR RETAINED ANNUITIES- For purposes of subsection (a), in the case of an interest described in paragraph (1)(A) (determined without regard to this paragraph) which is retained by the transferor, such interest shall be treated as described in such paragraph only if--CommentsClose CommentsPermalink





‘(A) the right to receive the fixed amounts referred to in such paragraph is for a term of not less than 10 years,CommentsClose CommentsPermalink





‘(B) such fixed amounts, when determined on an annual basis, do not decrease relative to any prior year during the first 10 years of the term referred to in subparagraph (A), andCommentsClose CommentsPermalink





‘(C) the remainder interest has a value greater than zero determined as of the time of the transfer.’.CommentsClose CommentsPermalink





(b) Effective Date- The amendments made by this section shall apply to transfers made after the date of the enactment of this Act.CommentsClose CommentsPermalink

SEC. 532. CRUDE TALL OIL INELIGIBLE FOR CELLULOSIC BIOFUEL PRODUCER CREDIT.

(a) In General- Clause (iii) of section 40(b)(6)(E) is amended--CommentsClose CommentsPermalink





(1) by striking ‘or’ at the end of subclause (I),CommentsClose CommentsPermalink





(2) by striking the period at the end of subclause (II) and inserting ‘, or’,CommentsClose CommentsPermalink





(3) by adding at the end the following new subclause:CommentsClose CommentsPermalink





‘(III) such fuel has an acid number greater than 25.’, andCommentsClose CommentsPermalink





(4) by striking ‘UNPROCESSED’ in the heading and inserting ‘CERTAIN’.CommentsClose CommentsPermalink





(b) Effective Date- The amendment made by this section shall apply to fuels sold or used on or after January 1, 2010.CommentsClose CommentsPermalink

SEC. 533. TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES.

The percentage under paragraph (2) of section 561 of the Hiring Incentives to Restore Employment Act in effect on the date of the enactment of this Act is increased by 7.75 percentage points.CommentsClose CommentsPermalink