S. 3083 – Reading Mode

111th CONGRESS

2d Session

S. 3083

IN THE SENATE OF THE UNITED STATES

March 5, 2010

Mr. Bennett introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend the Internal Revenue Code of 1986 to allow the expensing of certain real property.

Short title

This Act may be cited as the Main Street Revitalization Act of 2010.

10-year carryback of operating losses of small businesses

(a)

In general

Section 172(b)(1) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

(I)

Carryback for 2010 and 2011 net operating losses of small businesses

(i)

In general

If a small business (as defined in subparagraph (F)(iii) determined by applying such subparagraph for a 10-taxable year period) elects the application of this subparagraph with respect to an applicable 2010 or 2011 net operating loss—

(I)

subparagraph (A)(i) shall be applied by substituting any whole number elected by the taxpayer which is more than 2 and less than 11 for 2,

(II)

subparagraph (E)(ii) shall be applied by substituting the whole number which is one less than the whole number substituted under subclause (I) for 2, and

(III)

subparagraph (F) shall not apply.

(ii)

Applicable 2010 or 2011 net operating loss

For purposes of this subparagraph, the term applicable 2010 or 2011 net operating loss means—

(I)

the taxpayer’s net operating loss for any taxable year ending in 2010 or 2011, or

(II)

if the taxpayer elects to have this subclause apply in lieu of subclause (I), the taxpayer’s net operating loss for any taxable year beginning in 2010 or 2011.

(iii)

Election

Any election under this subparagraph shall be made in such manner as may be prescribed by the Secretary, and shall be made by the due date (including extension of time) for filing the taxpayer’s return for the taxable year of the net operating loss. Any such election, once made, shall be irrevocable. Any election under this subparagraph may be made only with respect to 2 taxable years.

(b)

Anti-Abuse rules

The Secretary of Treasury or the Secretary's designee shall prescribe such rules as are necessary to prevent the abuse of the purposes of the amendments made by this section, including anti-stuffing rules, anti-churning rules (including rules relating to sale-leasebacks), and rules similar to the rules under section 1091 of the Internal Revenue Code of 1986 relating to losses from wash sales.

(c)

Effective date

(1)

In general

Except as otherwise provided in this subsection, the amendments made by this section shall apply to net operating losses arising in taxable years ending after December 31, 2009.

(2)

Transitional rule

In the case of a net operating loss for a taxable year ending before the date of the enactment of this Act—

(A)

any election made under section 172(b)(3) of the Internal Revenue Code of 1986 with respect to such loss may (notwithstanding such section) be revoked before the applicable date, and

(B)

any application under section 6411(a) of such Code with respect to such loss shall be treated as timely filed if filed before the applicable date.

For purposes of this paragraph, the term applicable date means the date which is 60 days after the date of the enactment of this Act.

Permanent increase in limitations on expensing of certain depreciable business assets; expensing of certain real property

(a)

In general

Subsection (b) of section 179 of the Internal Revenue Code of 1986 (relating to limitations) is amended—

(1)

by striking $25,000 and all that follows in paragraph (1) and inserting $250,000.,

(2)

by striking $200,000 and all that follows in paragraph (2) and inserting $800,000,

(3)

by striking after 2007 and before 2011, the $120,000 and $500,000 in paragraph (5)(A) and inserting after 2010, the $250,000 and the $800,000,

(4)

by striking 2006 in paragraph (5)(A)(ii) and inserting 2009, and

(5)

by striking paragraph (7).

(b)

Permanent expensing of computer software; expensing for certain real property

Paragraph (1) of section 179(d) of the Internal Revenue Code of 1986 (defining section 179 property) is amended to read as follows:

(1)

Section 179 property

For purposes of this section, the term section 179 property means property acquired by purchase for use in the active conduct of a trade or business—

(A)

which—

(i)

is—

(I)

tangible property (to which section 168 applies), or

(II)

computer software (as defined in section 197(e)(3)(B)) which is described in section 197(e)(3)(A)(i), to which section 167 applies, and which is placed in service in a taxable year beginning after 2002, and

(ii)

is section 1245 property (as defined in section 1245(a)(3)), or

(B)

which is section 1250 property (as defined by section 1250(c)).

Such term shall not include any property described in section 50(b) and shall not include air conditioning or heating units.

(c)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2009.

Increase in amount allowed as deduction for start-up expenditures

(a)

In general

Subsection (b) of section 195 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

(3)

Special rule for taxable years beginning in 2010, 2011, or 2012

In the case of a taxable year beginning in 2010, 2011, or 2012, paragraph (1)(A)(ii) shall be applied by substituting $20,000 for $5,000.

(b)

Effective date

The amendment made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2009.