Text: H.R.2672 — 111th Congress (2009-2010)All Information (Except Text)

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Introduced in House (06/03/2009)


111th CONGRESS
1st Session
H. R. 2672


To amend the Internal Revenue Code of 1986 to allow credits for the establishment of franchises with veterans.


IN THE HOUSE OF REPRESENTATIVES

June 3, 2009

Mr. Schock (for himself and Mr. Boswell) 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 credits for the establishment of franchises with veterans.

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 “Help Veterans Own Franchises Act”.

SEC. 2. Veterans franchising credit.

(a) In general.—Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to business related credits) is amended by adding at the end the following new section:

“SEC. 45R. Veterans franchising.

“(a) Franchisor veterans discount credit.—

“(1) IN GENERAL.—For purposes of section 38, the franchisor veterans discount credit determined under this section for the taxable year is an amount equal to 50 percent of the qualified franchise fee discount provided by the taxpayer during the taxable year.

“(2) LIMITATION.—The amount allowed as a credit under paragraph (1) with respect to the purchase of any franchise shall not exceed $25,000.

“(b) Veterans franchise fee credit.—

“(1) IN GENERAL.—For purposes of section 38, the veterans franchise fee credit determined under this section for the taxable year is an amount equal to 25 percent of the qualified franchise fee paid or incurred by the taxpayer in connection with the purchase of a franchise in which a qualified franchise fee discount is offered by the franchisor.

“(2) LIMITATION.—For purposes of paragraph (1), the amount of franchise fees taken into account under paragraph (1) in connection with a franchise shall not exceed $100,000.

“(c) Reduction where franchise not 100 percent veteran-owned.—In the case of any franchise in which veterans do not own 100 percent of the stock or of the capital or profits interests of the franchisee, the credits under subsections (a) and (b) shall be the credit amount determined under each such subsection, multiplied by the same ratio as—

“(1) the stock or capital or profits interests of the franchise held by veterans, bears

“(2) to the total stock or capital or profits interests of the franchisee.

For purposes of this subsection, the spouse of a veteran shall be treated as a veteran.

“(d) Qualified franchise fee discount.—For purposes of this section, the term ‘qualified franchise fee discount’ means with respect to a franchise arrangement—

“(1) the amount of the franchise fee offer listed in the most recent franchise disclosure document of the franchisor, over

“(2) the qualified franchise fee actually paid.

“(e) Qualified franchise fee.—For purposes of this section, the term ‘qualified franchise fee’ means any one-time fee required by the franchisor when entering into a franchise with a qualified veteran.

“(f) Other definitions.—For purposes of this section, the terms ‘franchise’, ‘franchisee’, ‘franchisor’, ‘franchise fee’, and ‘franchise disclosure document’ have the meanings given such terms in part 436 of title 16, Code of Federal Regulations (as in effect on January 1, 2009).

“(g) Veteran.—The term ‘veteran’ has the meaning given such term by section 101 of title 38, United States Code.

“(h) Election.—This section shall not apply to a taxpayer for any taxable year if such taxpayer elects to have this section not apply for such taxable year.”.

(b) Credit To be part of general business credit.—Section 38(b) of such Code is amended by striking “plus” at the end of paragraph (34), by striking the period at the end of paragraph (35) and inserting a comma, and by adding at the end the following new paragraphs:

“(36) the franchisor veterans discount credit determined under section 45R(a), plus

“(37) the veterans franchise fee credit determined under section 45R(b).”.

(c) Clerical amendment.—The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item:


“Sec. 45R. Veterans franchising.”.

(d) Effective date.—The amendments made by this section shall apply to taxable years ending after December 31, 2008.

SEC. 3. Publication of information by Department of Veterans Affairs and Small Business Administration.

The Administrator of the Small Business Administration and the Secretary of Veterans Affairs shall publicize in mailings and brochures sent to veterans service organizations and veteran advocacy groups information regarding discounted franchise fees under section 45R of the Internal Revenue Code of 1986 and other information about the program established under amendments made by this Act.