,,ii #aaeth ,,congress #ast ,session ,s4 #aedj ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,july #ab1 #bjag ,ms4 ,stabenow 7for herself1 ,mr4 ,brown1 and ,mr4 ,peters7 introduced the following bill2 which was read twice and referred to the ,committee on ,finance ,a ,,bill ,to amend the ,internal ,revenue ,code of #aihf to allow a credit against tax for investments in qualified production facilities4 #a4 ,short title ,this ,act may be cited as the ,growing ,small ,businesses ,act4 #b4 ,credit for qualifying production facilities 7a7 ,income tax credit 7#a7 ,in general ,section #df of the ,internal ,revenue ,code of #aihf is amended-- 7,a7 by striking and at the end of paragraph 7#e72 7,b7 by striking the period at the end of paragraph 7#f7 and inserting 1 and2 and 7,c7 by adding at the end the following new paragraph3 7#g7 the qualifying production facility credit4 4 7#b7 ,amount of credit ,subpart ,e of part ,,iv of subchapter ,a of chapter #a of the ,internal ,revenue ,code of #aihf is amended by inserting after section #dh;,d the following new section3 #dh;,e4 ,credit for qualifying production facilities 7a7 ,in general ,for purposes of section #df1 in the case of an eligible employer1 the qualifying production facility credit for any taxable year is an amount equal to #be percent of the basis of eligible property placed in service during the taxable year4 7b7 ,eligible employer ,for purposes of this section-- 7#a7 ,in general ,the term eligible employer means any employer-- 7,a7 which has no more than #ej full-time equivalent employees 7within the meaning of section #de,r7d77#b77 for the taxable year1 and 7,b7 which has not 7prior to placing in service the production facility designated for purposes of this section7 placed in service a dedicated facility for the production of goods for sale4 7#b7 ,safe harbor 7,a7 ,in general ,an employer shall not be treated as having previously placed in service a facility described in paragraph 7#a77;,b7 if-- 7i7 a credit under this section has not previously been allowed to the employer1 and 7ii7 the cost of applicable property placed into service by the employer for each taxable year during the #e-taxable-year period ending immediately before the taxable year did not exceed #g1ejj4 7,b7 ,applicable property ,for purposes of subparagraph 7,a71 the term applicable property means personal property which would have qualified as eligible property under subsection 7c77#a77;,b7 if such property were placed in service by an eligible employer at a qualified production facility after enactment of this ,act for the production of a qualifying product4 7#c7 ,self-employed individual treated as employee ,for purposes of paragraph 7#a77;,a71 the term employee includes an individual described in section #dja7;c77#a74 7c7 ,eligible property ,for purposes of this section-- 7#a7 ,in general ,the term eligible property means-- 7,a7 any qualifying production facility-- 7i7 7,i7 the construction1 reconstruction1 or erection of which is completed by the taxpayer1 or 7,,ii7 which is acquired by the taxpayer by purchase 7as defined in section #agi7;d77#b771 and 7ii7 for which a deduction is allowable under section #afg1 and 7,b7 any personal property-- 7i7 which is placed in service within #ab months of the date on which a qualifying production facility for which a credit is allowed under subsection 7a7 is placed in service1 7ii7 which is used exclusively at such qualifying production facility primarily for the production of a qualifying product1 and 7iii7 for which a deduction is allowable under section #afg4 7#b7 ,special rule for leased facilities ,in the case of any of a qualifying production facility which is leased by the taxpayer1 paragraph 7#a77;,b7 shall be applied by substituting the date on which the qualifying production facility was first leased by the taxpayer for the date on which a qualifying production facility for which a credit is allowed under subsection 7a7 is placed in service in clause 7i74 7d7 ,other definitions ,for purposes of this section-- 7#a7 ,qualifying production facility ,the term qualifying production facility means any facility which-- 7,a7 is used to produce qualifying products1 and 7,b7 is designated by the taxpayer as a qualifying production facility for purposes of this section at such time and in such manner as the ,secretary shall prescribe4 7#b7 ,qualifying product ,the term qualifying product means any of the following3 7,a7 ,tangible personal property4 7,b7 ,computer software 7as defined in section #afg7;f77#a77;,b774 7,c7 ,property described in section #afh7;f77#c74 7,d7 ,property described in section #afh7;f77#d74 7,e7 ,food and beverages which are prepared by the taxpayer but not primarily for consumption at property owned by the taxpayer4 7e7 ,special rules ,for purposes of this section-- 7#a7 ,controlled group ,all members of the same controlled group of corporations 7within the meaning of section #eb7;a77 and all persons under common control 7within the meaning of section #eb7;b77 shall be treated as #a person for purposes of this section4 7#b7 ,predecessor ,any reference in this section to an employer shall include a reference to any predecessor of such employer4 7#c7 ,certain qualified progress expenditures rules made applicable ,rules similar to the rules of subsections 7c77#d7 and 7d7 of section #df 7as in effect on the day before the enactment of the ,revenue ,reconciliation ,act of #aiij7 shall apply for purposes of this section4 7f7 ,election ,to apply credit against payroll taxes 7#a7 ,in general ,at the election of the eligible employer1 section #caaa7;f7 shall apply to the payroll tax credit portion of the credit otherwise determined under subsection 7a7 for the taxable year and such portion shall not be treated 7other than for purposes of section #ej7;c77 as a credit determined under subsection 7a74 7#b7 ,payroll tax credit portion ,for purposes of this subsection1 the payroll tax credit portion of the credit determined under subsection 7a7 with respect to any qualified small business for any taxable year is the least of-- 7,a7 the amount specified in the election made under this subsection1 7,b7 the credit determined under subsection 7a7 for the taxable year 7determined before the application of this subsection71 or 7,c7 in the case of an eligible employer other than a partnership or ,s corporation1 the amount of the business credit carryforward under section #ci carried from the taxable year 7determined before the application of this subsection to the taxable year74 7#c7 ,election 7,a7 ,in general ,any election under this subsection for any taxable year-- 7i7 shall specify the amount of the credit to which such election applies1 7ii7 shall be made on or before the due date 7including extensions7 of-- 7,i7 in the case of an eligible employer which is a partnership1 the return required to be filed under section #fjca1 7,,ii7 in the case of an eligible employer which is an ,s corporation1 the return required to be filed under section #fjcg1 and 7,,iii7 in the case of any other eligible employer1 the return of tax for the taxable year1 and 7iii7 may be revoked only with the consent of the ,secretary4 7,b7 ,limitations ,the amount specified in any election made under this subsection shall not exceed #bej1jjj4 7,c7 ,special rule for partnerships and s corporations ,in the case of an eligible employer which is a partnership or ,s corporation1 the election made under this subsection shall be made at the entity level4 7#d7 ,aggregation rules 7,a7 ,in general ,except as provided in subparagraph 7,b71 all persons or entities treated as a single taxpayer under subsection 7e77#a7 shall be treated as a single taxpayer for purposes of this subsection4 7,b7 ,special rules ,for purposes of this subsection and section #caaa7;g7-- 7i7 each of the persons treated as a single taxpayer under subparagraph 7,a7 may separately make the election under paragraph 7#a7 for any taxable year1 and 7ii7 the #bej1jjj amount under paragraph 7#c77;,b77i7 shall be allocated among all persons treated as a single taxpayer under subparagraph 7,a7 in the manner provided by the ,secretary which is similar to the manner provided under section #da7;f77#a74 7#e7 ,regulations ,the ,secretary shall prescribe such regulations as may be necessary to carry out the purposes of this subsection1 including-- 7,a7 regulations to prevent the avoidance of the purposes of the limitations and aggregation rules under this subsection1 7,b7 regulations to minimize compliance and recordkeeping burdens under this subsection1 and 7,c7 regulations for recapturing the benefit of credits determined under section #caaa7;g7 in cases where there is a recapture or a subsequent adjustment to the payroll tax credit portion of the credit determined under subsection 7a71 including requiring amended income tax returns in the cases where there is such an adjustment4 4 7#c7 ,special rules relating to recapture 7,a7 ,certain related party transaction ,paragraph 7#d7 of section #ej7;a7 of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new sentence3 ,subparagraph 7,b7 shall not apply to investment credit property described in section #dh;,e in any case in which the transaction is a transaction between related persons44 7,b7 ,loss of eligible employer status ,paragraph 7#e7 of section #ej7;a7 of such ,code is amended by adding at the end the following new paragraph3 7,d7 ,treatment of eligible employer status for qualifying production facility credit ,paragraphs 7#a7 and 7#b7 shall not apply with respect to any credit allowed under section #dh;,e solely because the taxpayer has ceased to be an eligible employer 7as defined in section #dh;,e7b77 in any taxable year after the year in which the credit is allowed4 4 7#d7 ,conforming amendments 7,a7 ,section #di7;a77#a77;,c7 of the ,internal ,revenue ,code of #aihf is amended-- 7i7 by striking and at the end of clause 7v72 7ii7 by striking the period at the end of clause 7vi7 and inserting 1 and2 and 7iii7 by adding after clause 7vi7 the following new clause3 7vii7 the basis of any eligible property under section #dh;,e4 4 7,b7 ,the table of sections for subpart ,e of part ,,iv of subchapter ,a of chapter #a of the ,internal ,revenue ,code of #aihf is amended by inserting after the item relating to section #dh;,d the following new item3 ,sec4 #dh;,e4 ,credit for qualifying production facilities4 4 7b7 ,payroll tax credit ,section #caaa of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new subsection3 7g7 ,credit for qualifying production facilities 7#a7 ,in general ,in the case of a taxpayer who has made an election under section #dh;,e7f7 for a taxable year1 there shall be allowed as a credit against the tax imposed by subsection 7a7 for the first calendar quarter which begins after the date on which the taxpayer files the return specified in section #dh;,e7f77#c77;,a77ii7 an amount equal to the payroll tax credit portion determined under section #dh;,e7f77#b74 7#b7 ,limitation ,the credit allowed by paragraph 7#a7 shall not exceed the tax imposed by subsection 7a7 for any calendar quarter on the wages paid with respect to the employment of all individuals in the employ of the employer4 7#c7 ,carryover of unused credit ,if the amount of the credit under paragraph 7#a7 exceeds the limitation of paragraph 7#b7 for any calendar quarter1 such excess shall be carried to the succeeding calendar quarter and allowed as a credit under paragraph 7#a7 for such quarter4 7#d7 ,deduction allowed for credited amounts ,the credit allowed under paragraph 7#a7 shall not be taken into account for purposes of determining the amount of any deduction allowed under chapter #a for taxes imposed under subsection 7a74 4 7c7 ,effective date ,the amendments made by this section shall apply to periods after the date of the enactment of this ,act1 under rules similar to the rules of section #dh7m7 of the ,internal ,revenue ,code of #aihf 7as in effect on the day before the date of the enactment of the ,revenue ,reconciliation ,act of #aiij74