,i #aacth ,,congress #ast ,session ,h4 ,r4 #abb ,,in ,,the ,,house ,,of ,,representatives ,january #c1 #bjac ,mr4 ,holt introduced the following bill2 which was referred to the ,committee on ,ways and ,means ,a ,,bill ,to amend the ,internal ,revenue ,code of #aihf to allow a credit against income tax for equity investments in high technology small business concerns4 #a4 ,short title ,this ,act may be cited as the ,creating ,jobs ,from ,innovative ,small ,businesses ,act of #bjac4 #b4 ,credit for investments in small technology innovation companies 7a7 ,in general ,subpart ,d of part ,,iv of subchapter ,a of chapter #a of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new section3 #de,s4 ,high technology investment tax credit 7a7 ,allowance of credit ,for purposes of section #ch1 the high technology investment tax credit determined under this section for the taxable year is an amount equal to #bj percent of the amount paid by the taxpayer during such year to acquire a qualified equity investment in a qualified high technology small business concern4 7b7 ,maximum credit 7#a7 ,in general ,the taxpayer's credit determined under this section for the taxable year shall not exceed the excess 7if any7 of-- 7,a7 #ajj1jjj1 over 7,b7 the taxpayer's 7and any predecessor's7 aggregate credit determined under this section for all prior taxable years4 7#b7 ,related parties 7,a7 ,in general ,for purposes of paragraph 7#a71 all related persons shall be treated as #a person1 and the dollar amount in paragraph 7#a77;,a7 shall be allocated among such persons under regulations prescribed by the ,secretary4 7,b7 ,related persons ,a person shall be treated as related to another person if the relationship between such persons would result in the disallowance of losses under section #bfg or #gjg7;b74 7c7 ,definitions ,for purposes of this section-- 7#a7 ,qualified equity investment 7,a7 ,in general ,the term qualified equity investment means any equity investment in a qualified high technology small business concern if-- 7i7 such investment is acquired by the taxpayer at its original issue 7directly or through an underwriter7 solely in exchange for cash1 and 7ii7 such investment is designated for purposes of this section by such concern4 7,b7 ,equity investment ,the term equity investment means-- 7i7 any stock 7other than nonqualified preferred stock as defined in section #cea7;g77#b77 in an entity which is a corporation1 and 7ii7 any capital interest in an entity which is a partnership4 7,c7 ,redemptions ,a rule similar to the rule of section #abjb7;c77#c7 shall apply for purposes of this subsection4 7#b7 ,qualified high technology small business concern ,the term qualified high technology small business concern means1 with respect to any taxable year1 any small business concern 7as defined in section #c of the ,small ,business ,act7 if-- 7,a7 such concern employs an average of fewer than #ejj employees on business days during such year1 and 7,b7 at least #ej percent of the gross expenditures of such entity for such year are research or experimental expenditures under section #agd4 7d7 ,national limitation on amount of investments designated 7#a7 ,in general ,there is a high technology investment tax credit limitation for each calendar year4 ,such limitation is-- 7,a7 #ejj1jjj1jjj for #bjac1 7,b7 #gej1jjj1jjj for #bjad and #bjae1 and 7,c7 #a1jjj1jjj1jjj for #bjaf and #bjag4 7#b7 ,allocation of limitation ,the limitation under paragraph 7#a7 shall be allocated by the ,secretary among qualified high technology small business concerns selected by the ,secretary4 7#c7 ,carryover of unused limitation ,if the high technology investment tax credit limitation for any calendar year exceeds the aggregate amount allocated under paragraph 7#b7 for such year1 such limitation for the succeeding calendar year shall be increased by the amount of such excess4 ,no amount may be carried under the preceding sentence to any calendar year after #bjbc4 7e7 ,certain taxpayers not eligible ,no credit shall be determined under this section for any equity investment in any qualified high technology small business concern made by any individual who1 at the time of the investment1 is-- 7#a7 an employee of such concern1 or 7#b7 a member of the family 7within the meaning of section #bfg7;c77#d77 of an employee of such concern4 7f7 ,basis reduction ,the basis of any qualified equity investment shall be reduced by the amount of any credit determined under this section with respect to such investment4 ,this subsection shall not apply for purposes of sections #abjb1 #adjj;,b1 and #adjj;,f4 7g7 ,regulations ,the ,secretary shall prescribe such regulations as may be appropriate to carry out this section1 including regulations-- 7#a7 which prevent the abuse of the purposes of this section1 7#b7 which impose appropriate reporting requirements1 and 7#c7 which apply the provisions of this section to newly formed entities4 4 7b7 ,credit made part of general business credit ,subsection 7b7 of section #ch of such ,code 7relating to current year business credit7 is amended by striking plus at the end of paragraph 7#ce71 by striking the period at the end of paragraph 7#cf7 and inserting 1 plus1 and by adding at the end the following new paragraph3 7#cg7 the high technology investment tax credit determined under section #de,s4 4 7c7 ,clerical amendment ,the table of sections for subpart ,d of part ,,iv of subchapter ,a of chapter #a of such ,code is amended by adding at the end the following new item3 ,sec4 #de,s4 ,high technology investment tax credit44 7d7 ,effective date ,the amendments made by this section shall apply to investments made after ,december #ca1 #bjab1 in taxable years ending after such date4