[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4438 Received in Senate (RDS)]
113th CONGRESS
2d Session
H. R. 4438
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 12, 2014
Received
_______________________________________________________________________
AN ACT
To amend the Internal Revenue Code of 1986 to simplify and make
permanent the research credit.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``American Research and
Competitiveness Act of 2014''.
SEC. 2. RESEARCH CREDIT SIMPLIFIED AND MADE PERMANENT.
(a) In General.--Subsection (a) of section 41 of the Internal
Revenue Code of 1986 is amended to read as follows:
``(a) In General.--For purposes of section 38, the research credit
determined under this section for the taxable year shall be an amount
equal to the sum of--
``(1) 20 percent of so much of the qualified research
expenses for the taxable year as exceeds 50 percent of the
average qualified research expenses for the 3 taxable years
preceding the taxable year for which the credit is being
determined,
``(2) 20 percent of so much of the basic research payments
for the taxable year as exceeds 50 percent of the average basic
research payments for the 3 taxable years preceding the taxable
year for which the credit is being determined, plus
``(3) 20 percent of the amounts paid or incurred by the
taxpayer in carrying on any trade or business of the taxpayer
during the taxable year (including as contributions) to an
energy research consortium for energy research.''.
(b) Repeal of Termination.--Section 41 of such Code is amended by
striking subsection (h).
(c) Conforming Amendments.--
(1) Subsection (c) of section 41 of such Code is amended to
read as follows:
``(c) Determination of Average Research Expenses for Prior Years.--
``(1) Special rule in case of no qualified research
expenditures in any of 3 preceding taxable years.--In any case
in which the taxpayer has no qualified research expenses in any
one of the 3 taxable years preceding the taxable year for which
the credit is being determined, the amount determined under
subsection (a)(1) for such taxable year shall be equal to 10
percent of the qualified research expenses for the taxable
year.
``(2) Consistent treatment of expenses.--
``(A) In general.--Notwithstanding whether the
period for filing a claim for credit or refund has
expired for any taxable year taken into account in
determining the average qualified research expenses, or
average basic research payments, taken into account
under subsection (a), the qualified research expenses
and basic research payments taken into account in
determining such averages shall be determined on a
basis consistent with the determination of qualified
research expenses and basic research payments,
respectively, for the credit year.
``(B) Prevention of distortions.--The Secretary may
prescribe regulations to prevent distortions in
calculating a taxpayer's qualified research expenses or
basic research payments caused by a change in
accounting methods used by such taxpayer between the
current year and a year taken into account in
determining the average qualified research expenses or
average basic research payments taken into account
under subsection (a).''.
(2) Section 41(e) of such Code is amended--
(A) by striking all that precedes paragraph (6) and
inserting the following:
``(e) Basic Research Payments.--For purposes of this section--
``(1) In general.--The term `basic research payment' means,
with respect to any taxable year, any amount paid in cash
during such taxable year by a corporation to any qualified
organization for basic research but only if--
``(A) such payment is pursuant to a written
agreement between such corporation and such qualified
organization, and
``(B) such basic research is to be performed by
such qualified organization.
``(2) Exception to requirement that research be performed
by the organization.--In the case of a qualified organization
described in subparagraph (C) or (D) of paragraph (3),
subparagraph (B) of paragraph (1) shall not apply.'',
(B) by redesignating paragraphs (6) and (7) as
paragraphs (3) and (4), respectively, and
(C) in paragraph (4) as so redesignated, by
striking subparagraphs (B) and (C) and by redesignating
subparagraphs (D) and (E) as subparagraphs (B) and (C),
respectively.
(3) Section 41(f)(3) of such Code is amended--
(A)(i) by striking ``, and the gross receipts'' in
subparagraph (A)(i) and all that follows through
``determined under clause (iii)'',
(ii) by striking clause (iii) of subparagraph (A)
and redesignating clauses (iv), (v), and (vi), thereof,
as clauses (iii), (iv), and (v), respectively,
(iii) by striking ``and (iv)'' each place it
appears in subparagraph (A)(iv) (as so redesignated)
and inserting ``and (iii)'',
(iv) by striking subclause (IV) of subparagraph
(A)(iv) (as so redesignated), by striking ``, and'' at
the end of subparagraph (A)(iv)(III) (as so
redesignated) and inserting a period, and by adding
``and'' at the end of subparagraph (A)(iv)(II) (as so
redesignated),
(v) by striking ``(A)(vi)'' in subparagraph (B) and
inserting ``(A)(v)'', and
(vi) by striking ``(A)(iv)(II)'' in subparagraph
(B)(i)(II) and inserting ``(A)(iii)(II)'',
(B) by striking ``, and the gross receipts of the
predecessor,'' in subparagraph (A)(iv)(II) (as so
redesignated),
(C) by striking ``, and the gross receipts of,'' in
subparagraph (B),
(D) by striking ``, or gross receipts of,'' in
subparagraph (B)(i)(I), and
(E) by striking subparagraph (C).
(d) Effective Date.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to taxable years
beginning after December 31, 2013.
(2) Subsection (b).--The amendment made by subsection (b)
shall apply to amounts paid or incurred after December 31,
2013.
SEC. 3. PAYGO SCORECARD.
(a) Paygo Scorecard.--The budgetary effects of this Act shall not
be entered on either PAYGO scorecard maintained pursuant to section
4(d) of the Statutory Pay-As-You-Go Act of 2010.
(b) Senate Paygo Scorecard.--The budgetary effects of this Act
shall not be entered on any PAYGO scorecard maintained for purposes of
section 201 of S. Con. Res. 21 (110th Congress).
Passed the House of Representatives May 9, 2014.
Attest:
KAREN L. HAAS,
Clerk.