,,ii  #aaf? ,,congress  #a/ ,session    
,s4 #ahhd  ,,9 ,,! ,,s5ate ,,( ,,!      
,,unit$ ,,/ates  ,june #ah1 #bjai,mr4   
,murphy 7= himself & ,mr4 ,blum5?al7    
introduc$ ! foll[+ bill2 :i* 0 read     
twice & ref]r$ to ! ,committee on       
,f9ance  ,a ,,bill  ,to am5d ! ,int]nal 
,rev5ue ,code ( #aihf to provide an     
enhanc$ rese>* cr$it = ! developm5t (   
sm>t gun te*nologies4  #a4 ,%ort title  
,?is ,act may be cit$ z ! ,/>t ,advanc+ 
,fire>ms ,enhancem5ts & ,te*nology ,act 
( #bjai or ! ,,safety ,act4  #b4        
,enhanc$ rese>* cr$it = developm5t (    
sm>t gun te*nologies  7a7 ,9 g5]al      
,subp>t ,d ( "p ,,iv ( sub*apt] ,a (    
*apt] #a ( ! ,int]nal ,rev5ue ,code (   
#aihf is am5d$ by ins]t+ aft] section   
#de,s ! foll[+ new section3  #de,t4     
,rese>* exp5ses = sm>t gun te*nologies  
7a7 ,g5]al rule ,= purposes ( section   
#ch1 9 ! case ( a taxpay] :o is a ,f$]al
 fire>ms lic5see1 ! sm>t gun te*nology  
cr$it det]m9$ "u ?is section = ! taxable
 ye> is an am\nt equal to #cj p]c5t ( ! 

excess (--  7#a7 ! sm>t gun te*nology   
exp5ses = ! taxable ye>1 ov]  7#b7 !    
base am\nt4  7b7 ,sm>t gun te*nology    
exp5ses2 base am\nt ,= purposes ( ?is   
section-- 7#a7 ,sm>t gun te*nology      
exp5ses  7,a7 ,9 g5]al ,except z o!rwise
 provid$ 9 ?is p>agraph1 ! t]m sm>t gun 
te*nology exp5ses means ! am\nts :i* are
 paid or incurr$ by ! taxpay] dur+ !    
taxable ye> :i* w\ld be describ$ 9      
section #da7;b7 if su* section 7 appli$ 
) ! modifications set =? 9 subp>agraph  
7,b74  7,b7 ,modifications ,= purposes (
 subp>agraph 7,a71 section #da7;b7 %all 
be appli$-- 7i7 by sub/itut+ sm>t gun   
te*nology rese>* = qualifi$ rese>* ea*  
place x appe>s 9 p>agraphs 7#b7 & 7#c7 (
 su* subsection1 &  7ii7 by sub/itut+   
#ajj p]c5t = #fe p]c5t 9 p>agraph       
7#c77;,a7 ( su* subsection4  7,c7       
,exclusion = am\nts fund$ by grants1 etc
 ,! t]m sm>t gun te*nology exp5ses %all 
n include any am\nt to ! ext5t su* am\nt
 is fund$ by any grant1 contract1 or    
o!rwise by ano!r p]son 7or any          

gov]nm5tal entity74  7#b7 ,base am\nt   
7,a7 ,9 g5]al ,except z provid$ 9       
subp>agraph 7,b71 ! t]m base am\nt means
 ! am\nt :i* w\ld be ! base am\nt 9     
section #da7;c7 if su* section 7 appli$ 
by sub/itut+ sm>t gun te*nology rese>* =
 qualifi$ rese>* ea* place x appe>s4    
7,b7 ,base am\nt is z]o = #c ye>s ,!    
base am\nt %all be z]o = purposes (     
det]m9+ ! am\nt ( cr$it = taxable ye>s  
beg9n+ 9 #bjbj1 #bjba1 or #bjbb4  7c7   
,sm>t gun te*nology rese>* ,= purposes (
 ?is section-- 7#a7 ,9 g5]al ,! t]m sm>t
 gun te*nology rese>* means qualifi$    
rese>* 7z def9$ 9 section #da7;d77 = !  
purpose ( develop+ sm>t gun te*nologies 
= fire>ms4  7#b7 ,sm>t gun te*nology ,! 
t]m sm>t gun te*nology means any        
te*nology 7o!r ?an a simple me*anical   
lock7 :i* is design$-- 7,a7 to prev5t a 
fire>m f be+ fir$ by any individual o!r 
?an an au?oriz$ us] ( ! fire>m1 &  7,b7 
to conv]t ! fire>m f ! inop]able        
condition to ! op]able condition 9 less 
?an #b seconds aft] ! au?oriz$ us] makes

 contact ) ! fire>m1 ! fire>m's arm+    
device1 or an ext]nal safe or lock+     
device4  7#c7 ,au?oriz$ us] ,= purposes 
( ?is subsection1 ! t]m au?oriz$ us]    
means1 ) respect to a fire>m1 ! own] ( !
 fire>m & any individual lawfully       
au?oriz$ by su* own] to op]ate ! fire>m4
  7#d7 ,simple me*anical lock ,=        
purposes ( ?is subsection1 ! t]m simple 
me*anical lock means a lock t uses a key
 or a conv5tional comb9ation lock4 ,su* 
t]m does n include an advanc$ lock t    
incorporates electronics or biometric   
s5sors1 or a lock ) o!r features to     
enable fa/] op5+ f any ori5tation ) l[  
visibility4  7d7 ,f$]al fire>ms lic5see 
,= purposes ( ?is section1 ! t]m ,f$]al 
fire>ms lic5see means any p]son hold+ a 
lic5se "u *apt] #dd ( title #ah1 ,unit$ 
,/ates ,code1 o!r ?an a lic5s$          
collector4  7e7 ,coord9ation ) cr$it =  
increas+ rese>* exp5ditures  7#a7 ,9    
g5]al ,except z provid$ 9 p>agraph 7#b71
 any sm>t gun te*nology exp5ses = a     
taxable ye> to :i* an election "u ?is   

section applies %all n be tak5 into     
acc\nt = purposes ( det]m9+ ! cr$it     
all[able "u section #da = su* taxable   
ye>4  7#b7 ,exp5ses includ$ 9 det]m9+   
base p]iod rese>* exp5ses ,sm>t gun     
te*nology exp5ses = any taxable ye> %all
 be tak5 into acc\nt 9 det]m9+ base     
p]iod rese>* exp5ses = purposes ( apply+
 section #da to subsequ5t taxable ye>s4 
7f7 ,special rules  7#a7 ,c]ta9 rules   
made applicable ,rules simil> to ! rules
 ( p>agraphs 7#a7 & 7#b7 ( section      
#da7;f7 %all apply = purposes ( ?is     
section4  7#b7 ,election ,?is section   
%all apply to any taxpay] = any taxable 
ye> only if su* taxpay] elects 7at su*  
"t & 9 su* mann] z ! ,secret>y may by   
regulations prescribe7 to h ?is section 
apply = su* taxable ye>4  7g7 ,treatm5t 
( ,cr$it = ,qualifi$ ,small ,bus9esses  
7#a7 ,9 g5]al ,"u rules simil> to !     
rules ( section #da7;h71 section        
#caaa7;f7 %all apply to ! payroll tax   
cr$it portion ( ! cr$it o!rwise det]m9$ 
"u subsection 7a7 = ! taxable ye> & su* 

portion %all n be treat$ 7o!r ?an =     
purposes ( section #bhj;,c7 z a cr$it   
det]m9$ "u subsection 7a74  7#b7 ,f$]al 
fire>ms lic5see exception ,= purposes ( 
?is subsection1 ! payroll tax cr$it     
portion ( ! cr$it o!rwise det]m9$ "u    
subsection 7a7 %all be det]m9$ )\t reg>d
 to :e!r ! taxpay] is a ,f$]al fire>ms  
lic5see4  4  7b7 ,d5ial ( d\ble b5efit  
,section #bhj;,c ( su* ,code is am5d$ by
 add+ at ! end ! foll[+ new subsection3 
7i7 ,cr$it = sm>t gun te*nology exp5ses 
7#a7 ,9 g5]al ,no d$uction %all be all[$
 = t portion ( ! sm>t gun te*nology     
exp5ses 7z def9$ 9 section #de,t7b77    
o!rwise all[able z a d$uction = !       
taxable ye> :i* is equal to ! am\nt ( ! 
cr$it all[able = ! taxable ye> "u       
section #de,t 7det]m9$ )\t reg>d to     
section #ch7;c774  7#b7 ,simil> rule :]e
 taxpay] capitalizes r ?an d$ucts       
exp5ses ,if-- 7,a7 ! am\nt ( ! cr$it    
all[able = ! taxable ye> "u section     
#de,t 7det]m9$ )\t reg>d to section     
#ch7;c771 exce$s  7,b7 ! am\nt all[able 

z a d$uction = ! taxable ye> = sm>t gun 
te*nology exp5ses 7det]m9$ )\t reg>d to 
p>agraph 7#a771  ! am\nt *>geable to    
capital acc\nt = ! taxable ye> = su*    
exp5ses %all be r$uc$ by ! am\nt ( su*  
excess4  7#c7 ,controll$ gr\ps ,9 ! case
 ( a corporation :i* is a memb] ( a     
controll$ gr\p ( corporations 7)9 !     
mean+ ( section #da7;f77#e77 or a trade 
or bus9ess :i* is treat$ z be+ "u common
 control ) o!r trades or bus9ess 7)9 !  
mean+ ( section #da7;f77#a77;,b771 ?is  
subsection %all be appli$ "u rules      
prescrib$ by ! ,secret>y simil> to !    
rules applicable "u subp>agraphs 7,a7 & 
7,b7 ( section #da7;f77#a74  4  7c7     
,cr$it made "p ( g5]al bus9ess cr$it    
7#a7 ,9 g5]al ,section #ch7;b7 ( su*    
,code is am5d$ by /rik+ plus at ! end ( 
p>agraph 7#ca71 by /rik+ ! p]iod at !   
end ( p>agraph 7#cb7 & ins]t+ 1 plus1 & 
by add+ at ! end !re( ! foll[+ new      
p>agraph3  7#cc7 9 ! case ( a taxpay] :o
 is a ,f$]al fire>ms lic5see 7z def9$ 9 
section #de,t7d771 ! sm>t gun te*nology 

cr$it det]m9$ "u section #de,t7a74  4   
7#b7 ,d$uction = c]ta9 unus$ bus9ess    
cr$its ,subsection 7c7 ( section #aif ( 
su* ,code is am5d$ by /rik+ & at ! end (
 p>agraph 7#ac71 by /rik+ ! p]iod at !  
end ( p>agraph 7#ad7 & ins]t+ 1 &1 & by 
add+ aft] p>agraph 7#h7 ! foll[+ new    
p>agraph3  7#ae7 ! sm>t gun te*nology   
cr$it det]m9$ "u section #de,t4  4  7d7 
,cl]ical am5dm5t ,! table ( sections =  
subp>t ,d ( "p ,,iv ( sub*apt] ,a (     
*apt] #a ( su* ,code is am5d$ by ins]t+ 
aft] ! item relat+ to section #de,s !   
foll[+ new item3  ,sec4 #de,t4 ,rese>*  
exp5ses = sm>t gun te*nologies4  4  7e7 
,effective date ,! am5dm5ts made by ?is 
section %all apply to am\nts paid or    
incurr$ aft] ,decemb] #ca1 #bjai1 9     
taxable ye>s beg9n+ aft] su* date4  #c4 
,fire>ms tax n to apply to co/ ( sm>t   
gun te*nology  7a7 ,9 g5]al ,section    
#daha ( ! ,int]nal ,rev5ue ,code ( #aihf
 is am5d$ by add+ at ! end ! foll[+ new 
s5t5ce3  ,! price tak5 into acc\nt "u ! 
prec$+ s5t5ce %all n include s mu* ( !  

price ( ! fire>m z is attributable to   
any sm>t gun te*nology 7z def9$ 9       
section #de,t7c77#b77 ( su* fire>m4 4   
7b7 ,effective date ,! am5dm5t made by  
?is section %all take effect on ,janu>y 
#a1 #bjbj4