,i  #aac? ,,congress  #a/ ,session  ,h4 
,r4 #cdh  ,,9 ,,! ,,h\se ,,(            
,,repres5tatives  ,janu>y #bb1 #bjac    
,mr4 ,rangel 7= himself1 ,mr4 ,van      
,holl51 ,mr4 ,blum5au]1 & ,mr4          
,mc,dermott7 introduc$ ! foll[+ bill2   
:i* 0 ref]r$ to ! ,committee on ,ways & 
,means  ,a ,,bill  ,to am5d ! ,int]nal  
,rev5ue ,code ( #aihf & ! ,social       
,security ,act to provide = employm5t   
tax treatm5t ( pr(essional s]vice       
bus9esses4  #a4 ,%ort title ,?is ,act   
may be cit$ z ! ,n>r[+ ,exceptions =    
,)hold+ ,taxes ,act ( #bjac4  #b4       
,employm5t tax treatm5t ( pr(essional   
s]vice bus9esses  7a7 ,9 g5]al ,section 
#adjb ( ! ,int]nal ,rev5ue ,code ( #aihf
 is am5d$ by add+ at ! end ! foll[+ new 
subsection3  7m7 ,special rules =       
pr(essional s]vice bus9esses  7#a7      
,%>ehold]s provid+ s]vices to           
disqualifi$ ,s corporations  7,a7 ,9    
g5]al ,9 ! case ( any disqualifi$ ,s    
corporation1 ea* %>ehold] ( su*         
disqualifi$ ,s corporation :o provides  

sub/antial s]vices ) respect to !       
pr(essional s]vice bus9ess ref]r$ to 9  
subp>agraph 7,c7 %all take into acc\nt  
su* %>ehold]'s pro rata %>e ( all items 
( income or loss describ$ 9 section     
#acff :i* are attributable to su*       
bus9ess 9 det]m9+ ! %>ehold]'s net e>n+s
 f self-employm5t4  7,b7 ,treatm5t (    
family memb]s ,except z o!rwise provid$ 
by ! ,secret>y1 ! %>ehold]'s pro rata   
%>e ( items ref]r$ to 9 subp>agraph 7,a7
 %all be increas$ by ! pro rata %>e (   
su* items ( ea* memb] ( su* %>ehold]'s  
family 7)9 ! mean+ ( section            
#cah7;a77#a77 :o does n provide         
sub/antial s]vices ) respect to su*     
pr(essional s]vice bus9ess4  7,c7       
,disqualifi$ ,s corporation ,= purposes 
( ?is subsection1 ! t]m disqualifi$ ,s  
corporation means--  7i7 any ,s         
corporation :i* is a p>tn] 9 a p>tn]%ip 
:i* is engag$ 9 a pr(essional s]vice    
bus9ess if sub/antially all ( !         
activities ( su* ,s corporation are     
p]=m$ 9 connection ) su* p>tn]%ip1 &    

7ii7 any o!r ,s corporation :i* is      
engag$ 9 a pr(essional s]vice bus9ess if
 ! pr9cipal asset ( su* bus9ess is !    
reputation & skill ( #c or few]         
employees4  7#b7 ,p>tn]s ,9 ! case ( any
 p>tn]%ip :i* is engag$ 9 a pr(essional 
s]vice bus9ess1 subsection 7a77#ac7 %all
 n apply to any p>tn] :o provides       
sub/antial s]vices ) respect to su*     
pr(essional s]vice bus9ess4  7#c7       
,pr(essional s]vice bus9ess ,= purposes 
( ?is subsection1 ! t]m pr(essional     
s]vice bus9ess means any trade or       
bus9ess if sub/antially all ( !         
activities ( su* trade or bus9ess       
involve provid+ s]vices 9 ! fields (    
heal?1 law1 lobby+1 eng9e]+1            
ar*itecture1 acc\nt+1 actu>ial sci5ce1  
p]=m+ arts1 consult+1 a?letics1 inve/m5t
 advice or managem5t1 or brok]age       
s]vices4  7#d7 ,regulations ,! ,secret>y
 %all prescribe su* regulations z may be
 necess>y or appropriate to c>ry out !  
purposes ( ?is subsection1 includ+      
regulations :i* prev5t ! avoidance ( !  

purposes ( ?is subsection ?r\gh ti]$    
entities or o!rwise4  7#e7 ,cross       
ref]5ce ,= employm5t tax treatm5t (     
wages paid to %>ehold]s ( ,s            
corporations1 see subtitle ,c4  4  7b7  
,con=m+ am5dm5t ,section #baa ( !       
,social ,security ,act is am5d$ by add+ 
at ! end ! foll[+ new subsection3  7l7  
,special rules = pr(essional s]vice     
bus9esses  7#a7 ,%>ehold]s provid+      
s]vices to disqualifi$ ,s corporations  
7,a7 ,9 g5]al ,9 ! case ( any           
disqualifi$ ,s corporation1 ea* %>ehold]
 ( su* disqualifi$ ,s corporation :o    
provides sub/antial s]vices ) respect to
 ! pr(essional s]vice bus9ess ref]r$ to 
9 subp>agraph 7,c7 %all take into acc\nt
 su* %>ehold]'s pro rata %>e ( all items
 ( income or loss describ$ 9 section    
#acff ( ! ,int]nal ,rev5ue ,code ( #aihf
 :i* are attributable to su* bus9ess 9  
det]m9+ ! %>ehold]'s net e>n+s f        
self-employm5t4  7,b7 ,treatm5t ( family
 memb]s ,except z o!rwise provid$ by !  
,secret>y ( ! ,treasury1 ! %>ehold]'s   

pro rata %>e ( items ref]r$ to 9        
subp>agraph 7,a7 %all be increas$ by !  
pro rata %>e ( su* items ( ea* memb] (  
su* %>ehold]'s family 7)9 ! mean+ (     
section #cah7;a77#a7 ( ! ,int]nal       
,rev5ue ,code ( #aihf7 :o does n provide
 sub/antial s]vices ) respect to su*    
pr(essional s]vice bus9ess4  7,c7       
,disqualifi$ ,s corporation ,= purposes 
( ?is subsection1 ! t]m disqualifi$ ,s  
corporation means--  7i7 any ,s         
corporation :i* is a p>tn] 9 a p>tn]%ip 
:i* is engag$ 9 a pr(essional s]vice    
bus9ess if sub/antially all ( !         
activities ( su* ,s corporation are     
p]=m$ 9 connection ) su* p>tn]%ip1 &    
7ii7 any o!r ,s corporation :i* is      
engag$ 9 a pr(essional s]vice bus9ess if
 ! pr9cipal asset ( su* bus9ess is !    
reputation & skill ( #c or few]         
employees4  7#b7 ,p>tn]s ,9 ! case ( any
 p>tn]%ip :i* is engag$ 9 a pr(essional 
s]vice bus9ess1 subsection 7a77#ab7 %all
 n apply to any p>tn] :o provides       
sub/antial s]vices ) respect to su*     

pr(essional s]vice bus9ess4  7#c7       
,pr(essional s]vice bus9ess ,= purposes 
( ?is subsection1 ! t]m pr(essional     
s]vice bus9ess means any trade or       
bus9ess if sub/antially all ( !         
activities ( su* trade or bus9ess       
involve provid+ s]vices 9 ! fields (    
heal?1 law1 lobby+1 eng9e]+1            
ar*itecture1 acc\nt+1 actu>ial sci5ce1  
p]=m+ arts1 consult+1 a?letics1 inve/m5t
 advice or managem5t1 or brok]age       
s]vices4  4  7c7 ,effective date ,!     
am5dm5ts made by ?is section %all apply 
to taxable ye>s beg9n+ aft] ,decemb]    
#ca1 #bjab4