Summary: H.R.6009 — 97th Congress (1981-1982)All Information (Except Text)

There is one summary for H.R.6009. Bill summaries are authored by CRS.

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Introduced in House (03/31/1982)

Enterprise Zone Tax Act of 1982 - Title I: Designation of Enterprise Zones - Amends the Internal Revenue Code to provide for the designation of enterprise zones by the Secretary of Housing and Urban Development for purposes of extending the tax incentives and regulatory flexibility measures provided by this Act. Specifies that State and local governments shall nominate areas for such designation. Limits the designation of enterprise zones to 25 nominated areas per year. Limits the period during which such designation shall remain in effect.

Specifies that the Secretary may designate such zones only if: (1) the area is within the jurisdiction of the local government; (2) the boundary of the area is continuous; (3) the area has a population of at least 4,000 if any portion thereof is located within a standard metropolitan statistical area (with a population of at least 50,000) or 2,500 otherwise, or is within an Indian reservation; and (4) the area meets specified unemployment and poverty requirements.

Requires nominating local governments, as a condition of the Secretary's designation, to agree in writing to follow a course of action which may include reducing tax rates, improving local services, simplifying or streamlining regulation of business, or receiving commitments of private entities to assist employees and residents of the area.

Terminates the authority of the Secretary to designate enterprise zones on December 31, 1985. Describes areas to which preference shall be given in deciding to designate enterprise zones.

Requires that any property tax reduction effected by a local government under the terms of this Act be disregarded for purposes of determining the eligibility of a State or local government for Federal assistance or benefits.

States that designation of an enterprise zone shall not give displaced persons from such an area any rights or benefits under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970.

Title II: Federal Income Tax Incentives - Subtitle A - Credits for Employers and Employees - Amends the Internal Revenue Code to allow employers a nonrefundable income tax credit for ten percent of the increase in payroll for all employees, taking into account a maximum of $15,000 in wages per employee. Allows such credit only for wages paid to employees who perform 90 percent of their services in work directly related to the conduct of the taxpayers' business located in the enterprise zone and who perform 50 percent of their services within such zone. Phases out such credit in the last three years of the enterprise zone designation.

Allows a nonrefundable income tax credit for employers equal to 50 percent of the wages paid to certain disadvantaged workers for the first three years of the enterprise zone designation. Phases out such credit by ten percent a year beginning in the fourth year after such designation.

Requires a recapture of such credit for the early termination of such employees. Disallows a deduction for the portion of wages or salaries subject to such credit. Requires employers to furnish to each employee a written statement showing the amount of wages paid to such employee.

Provides an income tax credit for enterprise zone employees equal to five percent of the first $9,000 of wages received each year. Phases out such credit in the last four years of the enterprise zone designation.

Subtitle B: Credits for Investment in Tangible Property in Enterprise Zones - Allows businesses an additional investment tax credit for certain tangible property located in enterprise zones. Limits such credit to five percent for zone personal property and ten percent for new zone construction property, including rental property. Requires that the property subject to such credit be predominantly used in the zone, be purchased after zone designation, and not be acquired from relatives or related corporations. Requires the recapture of such credit upon early disposition of the property.

Subtitle C: Reduction in Capital Gain Tax Rates - Eliminates the capital gains tax on property of corporations acquired after the enterprise zone designation and used in a zone business. Qualifies certain low-income rental housing located in an enterprise zone for such treatment. Permits property to remain qualified for purposes of the revised capital gains treatment after a designation of an enterprise zone has terminated. Exempts gain from the sale or exchange of property used in a business in an enterprise zone from the computation of the minimum tax.

Expresses the sense of Congress that if the minimum tax is modified, enterprise zone capital gain will be excluded in computing minimum taxable income.

Subtitle D: Extension of Carryover Periods - Extends the net operating loss and investment tax credit carryover period to the longer of 15 years or the duration of the enterprise zone designation for businesses operating in such zones.

Subtitle E: Rules Relating to Industrial Development Bonds - Provides that rules relating to small issue tax-exempt industrial development bonds now in effect shall apply to bonds used to finance land or other depreciable property located in an enterprise zone, even if such rules are subsequently changed.

Subtitle F: Sense of the Congress With Respect to Tax Simplification - Expresses the sense of the Congress that the Internal Revenue Service should simplify the administration and enforcement of any provision of the Internal Revenue Code affected by this Act.

Title III: Regulatory Flexibility - Revises the definition of "small entity" for purposes of the analysis of regulatory functions, to include qualified businesses (as defined in Title II of this Act), designating governments, and nonprofit enterprises operating within enterprise zones.

Authorizes Federal agencies, upon request by designating governments, to waive or modify rules and regulations which pertain to the carrying out of projects or activities within an enterprise zone. Requires agencies to approve such request if the resulting benefits of job creation, community development, or economic revitalization outweigh the public interest in continuation of the rule unchanged.

Disallows the waiver or modification of a rule that would directly violate a statutory requirement (including the Davis-Bacon Act and the Fair Labor Standards Act) or which would present a danger to the public health and safety. Provides that such waivers or modifications of a rule shall remain in effect as long as the zone designations.

Amends the Department of Housing and Urban Development Act to direct the Secretary of Housing and Urban Development to promote the coordination of all enterprise zone programs and consolidate all periodic reports required under such programs into one summary report.

Title IV: Establishment of Foreign Trade Zones in Enterprise Zones - Requires the Foreign-Trade Zone Board to consider on a priority basis and expedite the processing of applications for the establishment of foreign-trade zones within enterprise zones. Requires the Secretary of the Treasury to give priority to and expedite applications for the establishment of ports of entry necessary to establish such zones. States that to the maximum extent practicable foreign-trade zones should be established within enterprise zones.