,i  #aac? ,,congress  #a/ ,session  ,h4 
,r4 #hae  ,,9 ,,! ,,h\se ,,(            
,,repres5tatives  ,febru>y #be1 #bjac   
,mr4 ,ow5s introduc$ ! foll[+ bill2 :i* 
0 ref]r$ to ! ,committee on ,ways &     
,means  ,a ,,bill  ,to am5d ! ,int]nal  
,rev5ue ,code ( #aihf to make c]ta9     
divid5ds & di/ributions paid to         
individuals f c]ta9 small bus9esses     
exempt f tax to ! ext5t ( ! increas$    
wages ( ! small bus9ess4  #a4 ,exemption
 = c]ta9 di/ributions ( small bus9esses 
to ext5t ( increas$ wages  7a7 ,9 g5]al 
,"p ,,iii ( sub*apt] ,b ( *apt] #a ( !  
,int]nal ,rev5ue ,code ( #aihf is am5d$ 
by ins]t+ be=e section #adj ! foll[+ new
 section3  #aci;,f4 ,increas$-wage      
di/ributions ( small bus9esses  7a7     
,application to corporations  7#a7 ,9   
g5]al ,9 ! case ( a di/ribution to an   
individual f a corporation :i* is a     
small bus9ess conc]n1 gross income %all 
n include any increas$-wage             
exempt-divid5d4  7#b7 ,increas$-wage    
exempt-divid5d ,= purposes ( ?is        

subsection--  7,a7 ,9 g5]al ,! t]m      
increas$-wage exempt-divid5d means any  
divid5d prop]ly designat$ z an          
increas$-wage exempt-divid5d "u         
subp>agraph 7,b74  7,b7 ,designation ,a 
corporation :i* is a small bus9ess      
conc]n may designate any divid5d paid by
 su* corporation z an increas$-wage     
exempt-divid5d to ! ext5t t ! aggregate 
am\nt ( ! divid5ds s designat$ = any    
taxable ye> does n exce$ ! wage increase
 am\nt = su* taxable ye>4  7b7          
,application to p>tn]%ips  7#a7 ,9 g5]al
 ,9 ! case ( a di/ribution to an        
individual f a p>tn]%ip :i* is a small  
bus9ess conc]n--  7,a7 no ga9 %all be   
recogniz$ on any increas$-wage p>tn]%ip 
di/ribution1 &  7,b7 9 ! case ( an      
increas$-wage p>tn]%ip di/ribution )    
respect to :i* no ga9 is recogniz$ "u   
section #gca7;a77#b71 no r$uction %all  
be made to ! adju/$ basis to ! p>tn] ( 8
 int]e/ 9 ! p>tn]%ip "u section #gcc7a74
  7#b7 ,increas$-wage p>tn]%ip          
di/ribution ,= purposes ( ?is           

subsection--  7,a7 ,9 g5]al ,! t]m      
increas$-wage p>tn]%ip di/ribution means
 any ca% di/ribution f ! p>tn]%ip to a  
p>tn] :i* is prop]ly designat$ z an     
increas$-wage p>tn]%ip di/ribution "u   
subp>agraph 7,b74  7,b7 ,designation ,a 
p>tn]%ip :i* is a small bus9ess conc]n  
may designate any ca% di/ribution z an  
increas$-wage p>tn]%ip di/ribution to ! 
ext5t t ! aggregate am\nt ( !           
di/ributions s designat$ = any taxable  
ye> does n exce$ ! wage increase am\nt =
 su* taxable ye>4  7c7 ,wage increase   
am\nt ,= purposes ( ?is section--  7#a7 
,9 g5]al ,! t]m wage increase am\nt     
means1 ) respect to any corporation or  
p>tn]%ip = any taxable ye>1 ! sum (--   
7,a7 ! excess 7if any7 (--  7i7 !       
aggregate qualifi$ wages paid or incurr$
 by ! corporation or p>tn]%ip = su*     
taxable ye>1 ov]  7ii7 ! aggregate      
qualifi$ wages paid or incurr$ by !     
corporation or p>tn]%ip = ! prec$+      
taxable ye>1 plus  7,b7 any             
increas$-wage exempt-divid5ds or        

increas$-wage p>tn]%ip di/ributions     
receiv$ by su* corporation or p>tn]%ip  
dur+ su* taxable ye>4  7#b7 ,qualifi$   
wages ,! t]m qualifi$ wages has ! mean+ 
:i* w\ld be giv5 su* t]m by section     
#caba7;a7 if p>agraph 7#a7 !re( 7 appli$
 by treat+ ! contribution & b5efit base 
z be+ equal to #ej1jjj4  7#c7           
,aggregation rule ,all p]sons treat$ z a
 s+le employ] "u subsection 7a7 or 7b7 (
 section #eb %all be treat$ z "o p]son =
 purposes ( ?is subsection4  7#d7       
,treatm5t ( pr$ecessors ,any ref]5ce 9  
?is subsection to a corporation or      
p>tn]%ip %all include a ref]5ce to any  
pr$ecessor ( su* corporation or         
p>tn]%ip4  7d7 ,small bus9ess conc]n ,= 
purposes ( ?is section1 ! t]m small     
bus9ess conc]n has ! mean+ giv5 su* t]m 
by section #c ( ! ,small ,bus9ess ,act4 
4  7b7 ,con=m+ am5dm5ts  7#a7 ,section  
#a7;h77#aa77;,b77ii7 ( su* ,code is     
am5d$ by /rik+ & at ! end ( subclause   
7,,ii71 by /rik+ ! p]iod at ! end (     
subclause 7,,iii7 & ins]t+ 1 &1 & by    

add+ at ! end ! foll[+ new subclause3   
7,,iv7 any increas$-wage exempt-divid5d 
7z def9$ 9 section #aci;,f74  4  7#b7 ,!
 table ( sections = "p ,,iii ( sub*apt] 
,b ( *apt] #a ( su* ,code is am5d$ by   
ins]t+ be=e ! item relat+ to section    
#adj ! foll[+ new item3  ,sec4 #aci;,f4 
,increas$-wage di/ributions4  4  7c7    
,effective date ,! am5dm5ts made by ?is 
section %all apply to taxable ye>s      
beg9n+ aft] ,decemb] #ca1 #bjab4