,i #aafth ,,congress #ast ,session ,h4 ,r4 #idb ,,in ,,the ,,house ,,of ,,representatives ,january #ca1 #bjai,mr4 ,himes 7for himself1 ,ms4 ,kuster of ,new ,hampshire1 ,ms4 ,hill of ,california1 ,ms4 ,clarke of ,new ,york1 ,mr4 ,deutch1 ,mr4 ,perlmutter1 ,mr4 ,soto1 and ,mrs4 ,murphy7 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 provide an enhanced research credit for the development of smart gun technologies4 #a4 ,short title ,this ,act may be cited as the ,start ,advancing ,firearms ,enhancements and ,technology ,act of #bjah or the ,,safety ,act4 #b4 ,enhanced research credit for development of smart gun technologies 7a7 ,in general ,subpart ,d of part ,,iv of subchapter ,a of chapter #a of the ,internal ,revenue ,code of #aihf is amended by inserting after section #de,s the following new section3 #de,t4 ,research expenses for smart gun technologies 7a7 ,general rule ,for purposes of section #ch1 in the case of a taxpayer who is a ,federal firearms licensee1 the smart gun technology credit determined under this section for the taxable year is an amount equal to #cj percent of the excess of-- 7#a7 the smart gun technology expenses for the taxable year1 over 7#b7 the base amount4 7b7 ,smart gun technology expenses2 base amount ,for purposes of this section-- 7#a7 ,smart gun technology expenses 7,a7 ,in general ,except as otherwise provided in this paragraph1 the term smart gun technology expenses means the amounts which are paid or incurred by the taxpayer during the taxable year which would be described in section #da7;b7 if such section were applied with the modifications set forth in subparagraph 7,b74 7,b7 ,modifications ,for purposes of subparagraph 7,a71 section #da7;b7 shall be applied-- 7i7 by substituting smart gun technology research for qualified research each place it appears in paragraphs 7#b7 and 7#c7 of such subsection1 and 7ii7 by substituting #ajj percent for #fe percent in paragraph 7#c77;,a7 of such subsection4 7,c7 ,exclusion for amounts funded by grants1 etc ,the term smart gun technology expenses shall not include any amount to the extent such amount is funded by any grant1 contract1 or otherwise by another person 7or any governmental entity74 7#b7 ,base amount 7,a7 ,in general ,except as provided in subparagraph 7,b71 the term base amount means the amount which would be the base amount in section #da7;c7 if such section were applied by substituting smart gun technology research for qualified research each place it appears4 7,b7 ,base amount is zero for #c years ,the base amount shall be zero for purposes of determining the amount of credit for taxable years beginning in #bjai1 #bjbj1 or #bjba4 7c7 ,smart gun technology research ,for purposes of this section-- 7#a7 ,in general ,the term smart gun technology research means qualified research 7as defined in section #da7;d77 for the purpose of developing smart gun technologies for firearms4 7#b7 ,smart gun technology ,the term smart gun technology means any technology 7other than a simple mechanical lock7 which is designed-- 7,a7 to prevent a firearm from being fired by any individual other than an authorized user of the firearm1 and 7,b7 to convert the firearm from the inoperable condition to the operable condition in less than #b seconds after the authorized user makes contact with the firearm1 the firearm's arming device1 or an external safe or locking device4 7#c7 ,authorized user ,for purposes of this subsection1 the term authorized user means1 with respect to a firearm1 the owner of the firearm and any individual lawfully authorized by such owner to operate the firearm4 7#d7 ,simple mechanical lock ,for purposes of this subsection1 the term simple mechanical lock means a lock that uses a key or a conventional combination lock4 ,such term does not include an advanced lock that incorporates electronics or biometric sensors1 or a lock with other features to enable faster opening from any orientation with low visibility4 7d7 ,federal firearms licensee ,for purposes of this section1 the term ,federal firearms licensee means any person holding a license under chapter #dd of title #ah1 ,united ,states ,code1 other than a licensed collector4 7e7 ,coordination with credit for increasing research expenditures 7#a7 ,in general ,except as provided in paragraph 7#b71 any smart gun technology expenses for a taxable year to which an election under this section applies shall not be taken into account for purposes of determining the credit allowable under section #da for such taxable year4 7#b7 ,expenses included in determining base period research expenses ,smart gun technology expenses for any taxable year shall be taken into account in determining base period research expenses for purposes of applying section #da to subsequent taxable years4 7f7 ,special rules 7#a7 ,certain rules made applicable ,rules similar to the rules of paragraphs 7#a7 and 7#b7 of section #da7;f7 shall apply for purposes of this section4 7#b7 ,election ,this section shall apply to any taxpayer for any taxable year only if such taxpayer elects 7at such time and in such manner as the ,secretary may by regulations prescribe7 to have this section apply for such taxable year4 7g7 ,treatment of ,credit for ,qualified ,small ,businesses 7#a7 ,in general ,under rules similar to the rules of section #da7;h71 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 #bhj;,c7 as a credit determined under subsection 7a74 7#b7 ,federal firearms licensee exception ,for purposes of this subsection1 the payroll tax credit portion of the credit otherwise determined under subsection 7a7 shall be determined without regard to whether the taxpayer is a ,federal firearms licensee4 4 7b7 ,denial of double benefit ,section #bhj;,c of such ,code is amended by adding at the end the following new subsection3 7i7 ,credit for smart gun technology expenses 7#a7 ,in general ,no deduction shall be allowed for that portion of the smart gun technology expenses 7as defined in section #de,t7b77 otherwise allowable as a deduction for the taxable year which is equal to the amount of the credit allowable for the taxable year under section #de,t 7determined without regard to section #ch7;c7 thereof74 7#b7 ,similar rule where taxpayer capitalizes rather than deducts expenses ,if-- 7,a7 the amount of the credit allowable for the taxable year under section #de,t 7determined without regard to section #ch7;c771 exceeds 7,b7 the amount allowable as a deduction for the taxable year for smart gun technology expenses 7determined without regard to paragraph 7#a771 the amount chargeable to capital account for the taxable year for such expenses shall be reduced by the amount of such excess4 7#c7 ,controlled groups ,in the case of a corporation which is a member of a controlled group of corporations 7within the meaning of section #da7;f77#e77 or a trade or business which is treated as being under common control with other trades or business 7within the meaning of section #da7;f77#a77;,b771 this subsection shall be applied under rules prescribed by the ,secretary similar to the rules applicable under subparagraphs 7,a7 and 7,b7 of section #da7;f77#a74 4 7c7 ,credit made part of general business credit 7#a7 ,in general ,section #ch7;b7 of such ,code is amended by striking plus at the end of paragraph 7#ca71 by striking the period at the end of paragraph 7#cb7 and inserting 1 plus1 and by adding at the end thereof the following new paragraph3 7#cc7 in the case of a taxpayer who is a ,federal firearms licensee 7as defined in section #de,t7d771 the smart gun technology credit determined under section #de,t7a74 4 7#b7 ,deduction for certain unused business credits ,subsection 7c7 of section #aif of such ,code is amended by striking and at the end of paragraph 7#ac71 by striking the period at the end of paragraph 7#ad7 and inserting 1 and1 and by adding after paragraph 7#h7 the following new paragraph3 7#ae7 the smart gun technology credit determined under section #de,t4 4 7d7 ,clerical amendment ,the table of sections for subpart ,d of part ,,iv of subchapter ,a of chapter #a of such ,code is amended by inserting after the item relating to section #de,s the following new item3 ,sec4 #de,t4 ,research expenses for smart gun technologies4 4 7e7 ,effective date ,the amendments made by this section shall apply to amounts paid or incurred after ,december #ca1 #bjai1 in taxable years beginning after such date4 #c4 ,firearms tax not to apply to cost of smart gun technology 7a7 ,in general ,section #daha of the ,internal ,revenue ,code of #aihf is amended by adding at the end the following new sentence3 ,the price taken into account under the preceding sentence shall not include so much of the price of the firearm as is attributable to any smart gun technology 7as defined in section #de,t7c77#b77 of such firearm4 4 7b7 ,effective date ,the amendment made by this section shall take effect on ,january #a1 #bjbj4