[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4854 Introduced in House (IH)]
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117th CONGRESS
1st Session
H. R. 4854
To amend the Internal Revenue Code of 1986 to provide incentives for
livestock processing facilities.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 29, 2021
Mr. Smith of Missouri (for himself and Mr. Johnson of South Dakota)
introduced the following bill; which was referred to the Committee on
Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide incentives for
livestock processing facilities.
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 ``Feed America by Incentivizing Rural
Meat Packing Act'' or as the ``FAIR Meat Packing Act''.
SEC. 2. CREDIT FOR LIVESTOCK PROCESSING FACILITIES.
(a) In General.--Subpart E of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended by inserting after
section 48C the following new section:
``SEC. 48D. LIVESTOCK PROCESSING FACILITIES CREDIT.
``(a) In General.--For purposes of section 46, the livestock
processing facilities credit for any taxable year is an amount equal to
25 percent of the basis of each livestock processing facility property
placed in service by the taxpayer during such taxable year.
``(b) Limitation on Credit Amount.--The credit determined under
subsection (a) with respect to any taxpayer for any taxable year shall
not exceed $250,000.
``(c) Exclusion of Certain Large Processors.--No credit shall be
allowed under subsection (a) to any taxpayer for any taxable year if
the gross receipts (within the meaning of section 448(c) of the
Internal Revenue Code of 1986) of such taxpayer for such taxable year
exceed $100,000,000.
``(d) Livestock Processing Facility Property.--For purposes of this
section--
``(1) In general.--The term `livestock processing facility
property' means property with respect to which depreciation (or
amortization in lieu of depreciation) is allowable and which is
part of a livestock processing facility.
``(2) Trade or business requirement.--The term `livestock
processing facility property' shall not include any property
unless such property is used in the taxpayer's trade or
business of processing livestock.
``(e) Other Definitions.--For purposes of this section--
``(1) Livestock processing facility.--The term `livestock
processing facility' means a facility which slaughters
livestock for processing into meat and meat products, which
participates in a meat and poultry inspection program conducted
by the Department of Agriculture or the State in which such
facility is located, and at which an average of fewer than 500
employees are employed on business days during the taxable
year. Such term shall include any property used for the intake
or storage of livestock, the disposal or management of
livestock waste, or the packaging, handling, warehousing, or
storage of meat products, if such property is located on the
same site as such facility.
``(2) Livestock.--The term `livestock' means cattle, sheep,
goats, bison, swine, and poultry.
``(f) Special Rules.--
``(1) Certain progress expenditure rules made applicable.--
Rules similar to the rules of subsections (c)(4) and (d) of
section 46 (as in effect on the day before the date of the
enactment of the Revenue Reconciliation Act of 1990) shall
apply for purposes of subsection (a).
``(2) Aggregation rule.--For purposes of subsections (b)
and (c), all members of the same controlled group of
corporations (within the meaning of section 267(f)) and all
persons under common control (within the meaning of section
52(b) but determined by treating an interest of more than 50
percent as a controlling interest) shall be treated as 1 person
and the dollar limitation under subsection (b) shall be
allocated in such manner as the Secretary may provide.
``(3) Election to not have section apply.--No credit shall
be determined under subsection (a) with respect to any taxpayer
for any taxable year if such taxpayer make an election under
this paragraph (at such time and in such manner as the
Secretary may provide) to have such subsection not apply for
such taxable year.
``(g) Termination.--No credit shall be allowed under subsection (a)
with respect to any taxable year beginning after December 31, 2026.''.
(b) Conforming Amendments.--
(1) Section 46 of such Code is amended by striking ``and''
at the end of paragraph (5), by striking the period at the end
of paragraph (6) and inserting ``, and'', and by adding at the
end the following new paragraph:
``(7) the livestock processing facilities credit.''.
(2) Section 49(a)(1)(C) of such Code is amended by striking
``and'' at the end of clause (iv), by striking the period at
the end of clause (v) and inserting a comma, and by adding at
the end the following new clause:
``(vi) the basis of any livestock
processing facility property under section
48D.''.
(3) Section 50(a)(2)(E) of such Code is amended by striking
``or 48C(b)(2)'' and inserting ``48C(b)(2), or 48D(d)(1)''.
(4) The table of sections for subpart E of part IV of
subchapter A of chapter 1 of such Code is amended by inserting
after the item relating to section 48C the following new item:
``Sec. 48D. Livestock processing facilities credit.''.
(c) Effective Date.--The amendments made by this section shall
apply to periods after the date of the enactment of this Act under
rules similar to the rules of section 48(m) of the Internal Revenue
Code of 1986 (as in effect on the day before the date of the enactment
of the Revenue Reconciliation Act of 1990).
SEC. 3. REFUNDABLE CREDIT FOR STARTUP AND ORGANIZATIONAL EXPENDITURES
WITH RESPECT TO LIVESTOCK PROCESSING FACILITIES.
(a) In General.--Subpart C of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended by inserting after
section 36B the following new section:
``SEC. 36C. CREDIT FOR STARTUP AND ORGANIZATIONAL EXPENDITURES OF
LIVESTOCK PROCESSING FACILITIES.
``(a) In General.--There shall be allowed as a credit against the
tax imposed by this subtitle for any taxable year an amount equal to 90
percent of the sum of--
``(1) the qualified livestock processing facility start-up
expenditures of the taxpayer for such taxable year,
``(2) the qualified livestock processing facility corporate
organizational expenditures of the taxpayer for such taxable
year, plus
``(3) the qualified livestock processing facility
partnership organizational expenditures of the taxpayer for
such taxable year.
``(b) Qualified Livestock Processing Facility Start-Up
Expenditures.--For purposes of this section, the term `qualified
livestock processing facility start-up expenditures' means, with
respect to any taxpayer for any taxable year, the amount which would be
allowed as a deduction under section 195 to such taxpayer for such
taxable year with respect to any trade or business which slaughters
livestock into meat or meat products if--
``(1) section 195(b)(1)(A)(ii) were applied--
``(A) by substituting `$10,000' for `$5,000', and
``(B) by substituting `$60,000' for `$50,000', and
``(2) subsection (f) of this section did not apply.
``(c) Qualified Livestock Processing Facility Corporate
Organizational Expenditures.--For purposes of this section, the term
`qualified livestock processing facility corporate organizational
expenditures' means, with respect to any taxable year of any
corporation substantially all of the gross receipts (within the meaning
of section 448(c) of the Internal Revenue Code of 1986) of which are
reasonably expected to be derived from a trade or business which
slaughters livestock into meat or meat products, the amount which would
be allowed as a deduction under section 248 to such corporation for
such taxable year if--
``(1) section 248(a)(1)(B) were applied--
``(A) by substituting `$10,000' for `$5,000', and
``(B) by substituting `$60,000' for `$50,000',
``(2) in the case of any entity with a single owner that is
disregarded as an entity separate from its owner, section 248
were applied as if such entity were a corporation, and
``(3) subsection (f) of this section did not apply.
``(d) Qualified Livestock Processing Facility Partnership
Organizational Expenditures.--For purposes of this section, the term
`qualified livestock processing facility partnership organizational
expenditures' means, with respect to any taxable year of any
partnership substantially all of the gross receipts (within the meaning
of section 448(c) of the Internal Revenue Code of 1986) of which are
reasonably expected to be derived from a trade or business which
slaughters livestock into meat or meat products, the amount which would
be allowed as a deduction under section 709 with respect to such
partnership for such taxable year if--
``(1) section 709(b)(1)(A)(ii) were applied--
``(A) by substituting `$10,000' for `$5,000', and
``(B) by substituting `$60,000' for `$50,000', and
``(2) subsection (f) of this section did not apply.
``(e) Livestock.--For purposes of this section, the term
`livestock' means cattle, elk, reindeer, bison, deer, sheep, goats,
swine, and poultry.
``(f) Denial of Double Benefit.--Any deduction or credit allowed
under this title (other than this section) with respect to any
qualified livestock processing facility start-up expenditures,
qualified livestock processing facility corporate organizational
expenditures, or qualified livestock processing facility partnership
organizational expenditures shall be reduced by the amount of the
credit determined under this section.
``(g) Recapture.--If any credit is allowed under this section to
any taxpayer for any taxable year with respect to any trade or business
of processing livestock (including with respect to any entity
substantially all of the gross receipts of which are with respect to
the trade or business of processing of livestock) and such trade or
business ceases to be conducted during the 3-taxable-year period
following the taxable in which such credit is so allowed, the tax
imposed under this chapter on such taxpayer for the taxable year in
which such trade or business ceases shall be increased by the amount of
the credit so allowed.
``(h) Termination.--No credit shall be allowed under subsection (a)
with respect to any taxable year beginning after December 31, 2026.''.
(b) Conforming Amendments.--
(1) Section 6211(b)(4)(A) of such Code is amended by
inserting ``36C,'' after ``36B,''.
(2) Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting ``36C,'' after ``36B,''.
(3) The table of sections for subpart C of part IV of
subchapter A of chapter 1 of the Internal Revenue Code of 1986
is amended by inserting after the item relating to section 36B
the following new item:
``Sec. 36C. Credit for startup and organizational expenditures of
livestock processing facilities.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable year ending after the date of the enactment of this
Act.
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