H.R.2189 - To amend the Internal Revenue Code of 1986 to allow the use of completed contract method of accounting in the case of certain long-term naval vessel construction contracts.107th Congress (2001-2002)
|Sponsor:||Rep. Johnson, Nancy L. [R-CT-6] (Introduced 06/14/2001)|
|Committees:||House - Ways and Means|
|Latest Action:||06/14/2001 Referred to the House Committee on Ways and Means. (All Actions)|
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Text: H.R.2189 — 107th Congress (2001-2002)All Bill Information (Except Text)
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Introduced in House (06/14/2001)
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[Congressional Bills 107th Congress] [From the U.S. Government Printing Office] [H.R. 2189 Introduced in House (IH)] 107th CONGRESS 1st Session H. R. 2189 To amend the Internal Revenue Code of 1986 to allow the use of completed contract method of accounting in the case of certain long- term naval vessel construction contracts. _______________________________________________________________________ IN THE HOUSE OF REPRESENTATIVES June 14, 2001 Mrs. Johnson of Connecticut (for herself, Mr. Jefferson, Mr. McCrery, Mr. Spence, Mr. Hunter, Mr. Weldon of Pennsylvania, Mr. Taylor of Mississippi, Mr. Saxton, Mr. Simmons, Mr. Maloney of Connecticut, Mrs. Jo Ann Davis of Virginia, Mr. Schrock, Mr. Cunningham, Mr. Wicker, Mr. Vitter, Mr. Cooksey, Mr. Cantor, Mr. Scott, Mr. Pickering, and Mr. Shows) 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 allow the use of completed contract method of accounting in the case of certain long- term naval vessel construction contracts. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. MODIFICATION OF ACCOUNTING RULES FOR CERTAIN NAVAL LONG-TERM CONSTRUCTION CONTRACTS. (a) In General.--Section 460(e)(1) of the Internal Revenue Code of 1986 (relating to exception for certain construction contracts) is amended by striking ``or'' at the end of subparagraph (A), by striking the period at the end of subparagraph (B) and inserting ``, or'', and by inserting after subparagraph (B) the following new subparagraph: ``(C) a qualified naval construction contract for which an election is made under paragraph (7).''. (b) Qualified Naval Construction Contract.--Section 460(e) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph: ``(7) Qualified naval construction contract.-- ``(A) In general.--A taxpayer may elect to use the completed contract method of accounting with respect to any qualified naval construction contract. ``(B) Definitions.-- ``(i) Qualified naval construction contract.--For purposes of this subsection, the term `qualified naval construction contract' means a contract-- ``(I) entered into by the taxpayer with the Federal Government for the building, construction, reconstruction, or rehabilitation of a naval vessel, and ``(II) which the taxpayer estimates (at the time such contract is entered into) will be completed more than 24 months after the contract commencement date of such contract. ``(ii) Naval vessel.--For purposes of clause (i), the term `naval vessel' means any vessel intended to be navigated in, on, or under the water. ``(iii) Completed.--For purposes of this paragraph, the term `completed' means upon issuance of a letter of acceptance or similar document by the Federal Government. ``(iv) Entering contracts.--For purposes of clause (i), a taxpayer shall be treated as entering into a contract with the Federal Government if the taxpayer is specified in the bid for such contract as being a member of a team (for purposes of performing the work under such contract) that includes the person who entered into such contract. ``(C) Effect of election.--An election under this paragraph shall apply to all contracts of the taxpayer which are entered into during the taxable year in which the election is made or any subsequent taxable year. ``(D) Separate contract.--For purposes of applying this paragraph, in the case of a qualified naval construction contract which covers more than 1 vessel, each vessel covered by the contract shall be treated as a separate contract for the purpose of applying the completed contract method, and the gross contract price and the total contract costs shall be allocated to each separate vessel contract in accordance with regulations prescribed by the Secretary. ``(E) Earnings and profits.--Section 312(n)(6) shall not apply to a taxpayer which has made an election under this paragraph with respect to a qualified naval construction contract.''. (c) Effective Date.--The amendments made by this section shall apply with respect to contracts entered into after December 31, 2000. <all>