Home > Committee Reports > 112th Congress > H. Rept. 112-425

H. Rept. 112-425 - SMALL BUSINESS TAX CUT ACT112th Congress (2011-2012)

Committee Report

Show Overview

Report Type:	House Report
Accompanies:	H.R.9
Committees:	House Ways and Means Committee

Listen to this page

Report text available as:

TXT
PDF (PDF provides a complete and accurate display of this text.) Tip ?

112th Congress Report
HOUSE OF REPRESENTATIVES
2d Session 112-425

======================================================================

SMALL BUSINESS TAX CUT ACT

_______

April 10, 2012.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed

_______

Mr. Camp, from the Committee on Ways and Means,
submitted the following

R E P O R T

together with

DISSENTING VIEWS

[To accompany H.R. 9]

[Including cost estimate of the Congressional Budget Office]

The Committee on Ways and Means, to whom was referred the
bill (H.R. 9) to amend the Internal Revenue Code of 1986 to
provide a deduction for domestic business income of qualified
small businesses, having considered the same, report favorably
thereon with an amendment and recommend that the bill as
amended do pass.

CONTENTS

Page
I. Summary and Background...........................................5
II. Explanation of the Bill..........................................6
III. Votes of the Committee..........................................16
IV. Budget Effects of the Bill......................................18
V. Other Matters To Be Discussed Under the Rules of the House......21
VI. Changes in Existing Law Made by the Bill, as Reported...........26
VII. Dissenting Views................................................38

Amendment

The amendment is as follows:
Strike all after the enacting clause and insert the
following:

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Small Business Tax Cut Act''.

SEC. 2. DEDUCTION FOR DOMESTIC BUSINESS INCOME OF QUALIFIED SMALL
BUSINESSES.

(a) In General.--Part VI of subchapter B of chapter 1 of the Internal
Revenue Code of 1986 is amended by adding at the end the following new
section:

``SEC. 200. DOMESTIC BUSINESS INCOME OF QUALIFIED SMALL BUSINESSES.

``(a) Allowance of Deduction.--In the case of a qualified small
business, there shall be allowed as a deduction an amount equal to 20
percent of the lesser of--
``(1) the qualified domestic business income of the taxpayer
for the taxable year, or
``(2) taxable income (determined without regard to this
section) for the taxable year.
``(b) Deduction Limited Based on Wages Paid.--
``(1) In general.--The amount of the deduction allowable
under subsection (a) for any taxable year shall not exceed 50
percent of the greater of--
``(A) the W-2 wages of the taxpayer paid to non-
owners, or
``(B) the sum of--
``(i) the W-2 wages of the taxpayer paid to
individuals who are non-owner family members of
direct owners, plus
``(ii) any W-2 wages of the taxpayer paid to
10-percent-or-less direct owners.
``(2) Definitions related to ownership.--For purposes of this
section--
``(A) Non-owner.--The term `non-owner' means, with
respect to any qualified small business, any person who
does not own (and is not considered as owning within
the meaning of subsection (c) or (e)(3) of section 267,
as the case may be) any stock of such business (or, if
such business is other than a corporation, any capital
or profits interest of such business).
``(B) Non-owner family members.--An individual is a
non-owner family member of a direct owner if--
``(i) such individual is family (within the
meaning of section 267(c)(4)) of a direct
owner, and
``(ii) such individual would be a non-owner
if subsections (c) and (e)(3) of section 267
were applied without regard to section
267(c)(2).
``(C) Direct owner.--The term `direct owner' means,
with respect to any qualified small business, any
person who owns (or is considered as owning under the
applicable non-family attribution rules) any stock of
such business (or, if such business is other than a
corporation, any capital or profits interest of such
business).
``(D) 10-percent-or-less direct owners.--The term
`10-percent-or-less direct owner' means, with respect
to any qualified small business, any direct owner of
such business who owns (or is considered as owning
under the applicable non-family attribution rules)--
``(i) in the case of a qualified small
business which is a corporation, not more than
10 percent of the outstanding stock of the
corporation or stock possessing more than 10
percent of the total combined voting power of
all stock of the corporation, or
``(ii) in the case of a qualified small
business which is not a corporation, not more
than 10 percent of the capital or profits
interest of such business.
``(E) Applicable non-family attribution rules.--The
term `applicable non-family attribution rules' means
the attribution rules of subsection (c) or (e)(3) of
section 267, as the case may be, but in each case
applied without regard to section 267(c)(2).
``(3) W-2 wages.--For purposes of this section--
``(A) In general.--The term `W-2 wages' means, with
respect to any person for any taxable year of such
person, the sum of the amounts described in paragraphs
(3) and (8) of section 6051(a) paid by such person with
respect to employment of employees by such person
during the calendar year ending during such taxable
year.
``(B) Limitation to wages attributable to qualified
domestic business income.--Such term shall not include
any amount which is not properly allocable to domestic
business gross receipts for purposes of subsection
(c)(1).
``(C) Other requirements.--Except in the case of
amounts treated as W-2 wages under paragraph (4)--
``(i) such term shall not include any amount
which is not allowed as a deduction under
section 162 for the taxable year, and
``(ii) such term shall not include any amount
which is not properly included in a return
filed with the Social Security Administration
on or before the 60th day after the due date
(including extensions) for such return.
``(4) Certain partnership distributions treated as w-2
wages.--
``(A) In general.--In the case of a qualified small
business which is a partnership and elects the
application of this paragraph for the taxable year--
``(i) the qualified domestic business taxable
income of such partnership for such taxable
year (determined after the application of
clause (ii)) which is allocable under rules
similar to the rules of section
199(d)(1)(A)(ii) to each qualified service-
providing partner shall be treated for purposes
of this section as W-2 wages paid during such
taxable year to such partner as an employee,
and
``(ii) the domestic business gross receipts
of such partnership for such taxable year shall
be reduced by the amount so treated.
``(B) Qualified service-providing partner.--For
purposes of this paragraph, the term `qualified
service-providing partner' means, with respect to any
qualified domestic business taxable income, any partner
who is a 10-percent-or-less direct owner and who
materially participates in the trade or business to
which such income relates.
``(5) Acquisitions and dispositions.--The Secretary shall
provide for the application of this subsection in cases where
the taxpayer acquires, or disposes of, the major portion of a
trade or business or the major portion of a separate unit of a
trade or business during the taxable year.
``(c) Qualified Domestic Business Income.--For purposes of this
section--
``(1) In general.--The term `qualified domestic business
income' for any taxable year means an amount equal to the
excess (if any) of--
``(A) the taxpayer's domestic business gross receipts
for such taxable year, over
``(B) the sum of--
``(i) the cost of goods sold that are
allocable to such receipts, and
``(ii) other expenses, losses, or deductions
(other than the deduction allowed under this
section), which are properly allocable to such
receipts.
``(2) Domestic business gross receipts.--
``(A) In general.--The term `domestic business gross
receipts' means the gross receipts of the taxpayer
which are effectively connected with the conduct of a
trade or business within the United States within the
meaning of section 864(c) but determined--
``(i) without regard to paragraphs (3), (4),
and (5) thereof, and
``(ii) by substituting `qualified small
business (within the meaning of section 200)'
for `nonresident alien individual or a foreign
corporation' each place it appears therein.
``(B) Exceptions.--For purposes of paragraph (1),
domestic business gross receipts shall not include any
of the following:
``(i) Gross receipts derived from the sale or
exchange of--
``(I) a capital asset, or
``(II) property used in the trade or
business (as defined in section
1231(b)).
``(ii) Royalties, rents, dividends, interest,
or annuities.
``(iii) Any amount which constitutes wages
(as defined in section 3401).
``(3) Application of certain rules.--Rules similar to the
rules of paragraphs (2) and (3) of section 199(c) shall apply
for purposes of this section (applied with respect to qualified
domestic business income in lieu of qualified production
activities income and with respect to domestic business gross
receipts in lieu of domestic production gross receipts).
``(d) Qualified Small Business.--For purposes of this section--
``(1) In general.--The term `qualified small business' means
any employer engaged in a trade or business if such employer
had fewer than 500 full-time equivalent employees for either
calendar year 2010 or 2011.
``(2) Full-time equivalent employees.--The term `full-time
equivalent employees' has the meaning given such term by
subsection (d)(2) of section 45R applied--
``(A) without regard to subsection (d)(5) of such
section,
``(B) with regard to subsection (e)(1) of such
section, and
``(C) by substituting `calendar year' for `taxable
year' each place it appears therein.
``(3) Employers not in existence prior to 2012.--In the case
of an employer which was not in existence on January 1, 2012,
the determination under paragraph (1) shall be made with
respect to calendar year 2012.
``(4) Application to calendar years in which employer in
existence for portion of calendar year.--In the case of any
calendar year during which the employer comes into existence,
the number of full-time equivalent employees determined under
paragraph (2) with respect to such calendar year shall be
increased by multiplying the number so determined (without
regard to this paragraph) by the quotient obtained by
dividing--
``(A) the number of days in such calendar year, by
``(B) the number of days during such calendar year
which such employer is in existence.
``(5) Special rules.--
``(A) Aggregation rule.--For purposes of paragraph
(1), any person treated as a single employer under
subsection (a) or (b) of section 52 (applied without
regard to section 1563(b)) or subsection (m) or (o) of
section 414 shall be treated as a single employer for
purposes of this subsection.
``(B) Predecessors.--Any reference in this subsection
to an employer shall include a reference to any
predecessor of such employer.
``(e) Special Rules.--
``(1) Elective application of deduction.--Except as otherwise
provided by the Secretary, the taxpayer may elect not to take
any item of income into account as domestic business gross
receipts for purposes of this section.
``(2) Coordination with section 199.--If a deduction is
allowed under this section with respect to any taxpayer for any
taxable year--
``(A) any gross receipts of the taxpayer which are
taken into account under this section for such taxable
year shall not be taken into account under section 199
for such taxable year, and
``(B) the W-2 wages of the taxpayer which are taken
into account under this section shall not be taken into
account under section 199 for such taxable year.
``(3) Application of certain rules.--Rules similar to the
rules of paragraphs (1), (2), (3), (4), (6), and (7) of section
199(d) shall apply for purposes of this section (applied with
respect to qualified domestic business income in lieu of
qualified production activities income).
``(f) Regulations.--The Secretary shall prescribe such regulations as
are necessary to carry out the purposes of this section, including
regulations which prevent a taxpayer which reorganizes from being
treated as a qualified small business if such taxpayer would not have
been treated as a qualified small business prior to such
reorganization.
``(g) Application.--Subsection (a) shall apply only with respect to
the first taxable year of the taxpayer beginning after December 31,
2011.''.
(b) Conforming Amendments.--
(1) Section 56(d)(1)(A) of such Code is amended by striking
``deduction under section 199'' both places it appears and
inserting ``deductions under sections 199 and 200''.
(2) Section 56(g)(4)(C) of such Code is amended by adding at
the end the following new clause:
``(vii) Deduction for domestic business
income of qualified small businesses.--Clause
(i) shall not apply to any amount allowable as
a deduction under section 200.''.
(3) The following provisions of such Code are each amended by
inserting ``200,'' after ``199,''.
(A) Section 86(b)(2)(A).
(B) Section 135(c)(4)(A).
(C) Section 137(b)(3)(A).
(D) Section 219(g)(3)(A)(ii).
(E) Section 221(b)(2)(C)(i).
(F) Section 222(b)(2)(C)(i).
(G) Section 246(b)(1).
(H) Section 469(i)(3)(F)(iii).
(4) Section 163(j)(6)(A)(i) of such Code is amended by
striking ``and'' at the end of subclause (III) and by inserting
after subclause (IV) the following new subclause:
``(V) any deduction allowable under
section 200, and''.
(5) Section 170(b)(2)(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 ``, and'', and by inserting
after clause (v) the following new clause:
``(vi) section 200.''.
(6) Section 172(d) of such Code is amended by adding at the
end the following new paragraph:
``(8) Domestic business income of qualified small
businesses.--The deduction under section 200 shall not be
allowed.''.
(7) Section 613(a) of such Code is amended by striking
``deduction under section 199'' and inserting ``deductions
under sections 199 and 200''.
(8) Section 613A(d)(1) of such Code is amended by
redesignating subparagraphs (C), (D), and (E) as subparagraphs
(D), (E), and (F), respectively, and by inserting after
subparagraph (B) the following new subparagraph:
``(C) any deduction allowable under section 200,''.
(9) Section 1402(a) of such Code is amended by striking
``and'' at the end of paragraph (16), by redesignating
paragraph (17) as paragraph (18), and by inserting after
paragraph (16) the following new paragraph:
``(17) the deduction provided by section 200 shall not be
allowed; and''.
(c) Clerical Amendment.--The table of sections for part VI of
subchapter B of chapter 1 of such Code is amended by adding at the end
the following new item:

``Sec. 200. Domestic business income of qualified small businesses.''.

I. SUMMARY AND BACKGROUND

A. Purpose and Summary

The bill, H.R. 9, reported by the Committee on Ways and
Means, provides, in the case of a qualified small business for
the first taxable year beginning in 2012, a deduction for 20
percent of the qualified domestic business income of the
taxpayer for the taxable year, or taxable income for the
taxable year, whichever is less. However, a taxpayer's
deduction for any taxable year may not exceed 50 percent of
certain W-2 wages of the qualified small business.

B. Background and Need for Legislation

While the Committee continues to actively pursue
comprehensive tax reform as a critical means of promoting
economic growth and job creation, the Committee also believes
that it is important to provide small businesses meaningful,
immediate tax relief in order to help put more Americans back
to work right away. With the Nation's unemployment rate having
now remained above eight percent for more than three years, it
is critical that Congress help struggling small businesses hire
new employees and increase wages. By providing all qualified
small businesses with fewer than 500 employees--regardless of
whether they are organized as passthrough businesses (S
corporations or partnerships), sole proprietorships, or C
corporations--a 20-percent deduction against active business
income, H.R. 9 would help free up additional resources allowing
small businesses to create more jobs in communities across the
country.

C. Legislative History

Background

H.R. 9 was introduced on March 21, 2012, and was referred
to the Committee on Ways and Means.

Committee action

The Committee on Ways and Means marked up H.R. 9, the Small
Business Tax Cut Act, on March 28, 2012, and ordered the bill,
as amended, favorably reported (with a quorum being present).

Committee hearings

The proposed 20-percent deduction for small businesses has
been discussed at several Committee hearings during the 112th
Congress, including at the Select Revenue Measures
Subcommittee's March 3, 2011, hearing on ``Small Businesses and
Tax Reform'' and at the Committee's March 7, 2012, hearing on
``The Treatment of Closely-Held Businesses in the Context of
Tax Reform.'' While the general context for those particular
hearings was the need for broader comprehensive tax reform,
discrete legislative proposals affecting small businesses--such
as the 20-percent small business deduction embodied in H.R. 9--
were explored by Committee Members and witnesses at those
hearings as well.

II. EXPLANATION OF THE BILL

A. Twenty-Percent Deduction for Domestic Business Income of Qualified
Small Business (sec. 2 of the Bill and New sec. 200 of the Code)

PRESENT LAW

C corporations

A C corporation\1\ is subject to Federal income tax as an
entity separate from its shareholders. A C corporation's income
generally is taxed when earned at the corporate level and is
taxed again at the individual level when distributed as
dividends\2\ to its shareholders. Corporate deductions and
credits reduce only corporate income (and corporate income
taxes) and are not passed directly through to shareholders.
---------------------------------------------------------------------------
\1\A C corporation is so named because its Federal tax treatment is
governed by subchapter C of the Internal Revenue Code of 1986, as
amended (the ``Code'').
\2\Distributions with respect to stock that exceed corporate
earnings and profits are not taxed as dividend income to shareholders
but are treated as a tax-free return of capital that reduces the
shareholder's basis in the stock. Distributions in excess of corporate
earnings and profits that exceed a shareholder's basis in the stock are
treated as amounts received in exchange for the stock which, in
general, are taxed to the shareholder at capital gains rates. Sec.
301(c).
---------------------------------------------------------------------------

Tax rates for C corporations

C corporations are taxed at statutory rates ranging from 15
percent (for taxable income up to $50,000) to 35 percent (for
taxable income over $10,000,000); the intermediate rates are 25
percent (for taxable income above $50,000 but not exceeding
$75,000) and 34 percent (for taxable income above $75,000 but
not exceeding $10,000,000).\3\ The benefit of graduated rates
below 34 percent is phased out for C corporations with taxable
income between $100,000 and $335,000, and the benefit of the 34
percent rate is phased out for C corporations with taxable
income in excess of $15,000,000. C corporation long-term
capital gains are taxed at the same rates as C corporation
ordinary income. Thus, the maximum tax rate for C corporation
net long-term capital gains is 35 percent.
---------------------------------------------------------------------------
\3\Sec. 11.
---------------------------------------------------------------------------
A C corporation is subject to an alternative minimum tax
that is payable, in addition to all other tax liabilities, to
the extent that it exceeds the C corporation's regular income
tax liability. The tax is imposed at a flat rate of 20 percent
on alternative minimum taxable income (``AMTI'') in excess of a
$40,000 exemption amount.\4\ Certain credits that are allowed
to offset a C corporation's regular tax liability generally are
not allowed to offset its minimum tax liability. If a C
corporation pays the alternative minimum tax, the amount of the
tax paid is allowed as a credit against the regular tax in
future years to the extent the regular tax exceeds the
tentative minimum tax. Small C corporations meeting a gross
receipts test are exempt from the corporate alternative minimum
tax. Generally, a C corporation meets the gross receipts test
if its average annual gross receipts for the prior three
taxable years do not exceed $7.5 million.
---------------------------------------------------------------------------
\4\The exemption amount is phased out for corporations with income
above certain thresholds, and is completely phased out for corporations
with alternative minimum taxable income of $310,000 or more.
---------------------------------------------------------------------------

Passthrough entities

S corporations
An S corporation\5\ generally is not subject to corporate
tax on its income.\6\ Instead, S corporation shareholders
include in income their pro rata shares of the S corporation's
items of income (including tax-exempt income), gain, loss,
deduction, credit, and nonseparately computed income or loss,
whether or not distributed.\7\ To be eligible to elect S
corporation status, a corporation may not have more than 100
shareholders and may not have more than one class of stock.\8\
Only individuals (other than nonresident aliens), certain tax-
exempt organizations, and certain trusts and estates are
permitted shareholders. A corporation may elect S corporation
status only with the consent of all its shareholders, and may
terminate its election with the consent of shareholders holding
more than 50 percent of the stock.\9\
---------------------------------------------------------------------------
\5\An S corporation is so named because its Federal tax treatment
is governed by subchapter S of the Code.
\6\Sec. 1363.
\7\Sec. 1366.
\8\Sec. 1361. For this purpose, a husband and wife and all members
of a family are treated as one shareholder. Sec. 1361(c)(1).
\9\Sec. 1362.
---------------------------------------------------------------------------
Partnerships
Partnerships generally are treated for Federal income tax
purposes as passthrough entities, not subject to tax at the
entity level.\10\ Items of income (including tax-exempt
income), gain, loss, deduction, and credit of the partnership
are taken into account in computing the tax of the partners
(based on the partnership's method of accounting and regardless
of whether the income is distributed to the partners).\11\ A
partner's deduction for partnership losses is limited to the
amount of the partner's adjusted basis in his or her
partnership interest.\12\ To the extent a loss is not allowed
due to a limitation, it generally is carried forward to the
next year.
---------------------------------------------------------------------------
\10\Sec. 701.
\11\Sec. 702(a).
\12\Sec. 704(d).
---------------------------------------------------------------------------

TAX RATES FOR INDIVIDUALS

U.S. individuals (citizens and residents) are taxed at
graduated statutory rates ranging from 10 percent (for taxable
income of up to $8,700 for single filers and up to $17,400 for
married taxpayers filing joint returns or surviving spouses) to
35 percent (for taxable income over $388,350) for taxable year
2012; the intermediate rates are 15 percent, 25 percent, 28
percent, and 33 percent.\13\ The maximum tax rate on net long-
term capital gains generally is 15 percent.\14\ Dividends
received by an individual from domestic corporations and
qualified foreign corporations are taxed at the same rates that
apply to capital gains.\15\ For 2013, the statutory rates range
from 15 percent to 39.6 percent, and the maximum tax rate on
net long-term capital gains generally is 20 percent (other than
collectibles or unrecaptured section 1250 property).
---------------------------------------------------------------------------
\13\Secs. 1(a), (c) and (i).
\14\Sec. 1(h). Net gain from the sale of collectibles is taxed at a
maximum 28 percent rate, while certain gain from the sale or exchange
of depreciable real estate (``unrecaptured section 1250 property'') is
taxed at a maximum 25 percent rate. Under present law, for taxable
years beginning after 2012, the maximum tax rate applicable to net
long-term capital gains (other than collectibles or unrecaptured
section 1250 property) increases from 15 percent to 20 percent.
\15\Sec. 1(h)(11). Under present law, for taxable years beginning
after 2012, dividends received by an individual are taxed at ordinary
income rates.
---------------------------------------------------------------------------
An alternative minimum tax is imposed on an individual in
an amount by which the tentative minimum tax exceeds the
regular income tax for the taxable year. The tentative minimum
tax is the sum of (1) 26 percent of so much of the taxable
excess as does not exceed $175,000 ($87,500 in the case of a
married individual filing a separate return) and (2) 28 percent
of the remaining taxable excess. The taxable excess is so much
of the AMTI as exceeds the exemption amount. The maximum tax
rates on net capital gain and dividends used in computing the
regular tax are used in computing the tentative minimum tax.
AMTI is the taxpayer's taxable income increased by the
taxpayer's tax preferences and adjusted by determining the tax
treatment of certain items in a manner that negates the
deferral of income resulting from the regular tax treatment of
those items.
The exemption amounts are: (1) $45,000 in the case of
married individuals filing a joint return and surviving
spouses; (2) $33,750 in the case of other unmarried
individuals; and (3) $22,500 in the case of married individuals
filing separate returns. The exemption amounts are phased out
by an amount equal to 25 percent of the amount by which the
individual's AMTI exceeds (1) $150,000 in the case of married
individuals filing a joint return and surviving spouses, (2)
$112,500 in the case of other unmarried individuals, and (3)
$75,000 in the case of married individuals filing separate
returns. These amounts are not indexed for inflation.

Section 199 deduction

In general
Certain domestic production activities are effectively
taxed at lower rates by virtue of a deduction equal to a
percentage of the income from such activities.\16\ The
deduction is equal to nine percent of the lesser of income from
manufacturing, construction, and certain other activities
specified in the statute (collectively, qualified production
activities income), or taxable income.\17\ Thus, generally the
maximum tax rate for a C corporation on its domestic production
activities income is effectively 31.85 percent.\18\
---------------------------------------------------------------------------
\16\Sec. 199.
\17\However, for taxpayers that have qualified income related to
the production, refining, processing, transportation, or distribution
of oil, gas, or any primary product thereof (collectively, ``oil
related production activities income''), the deduction is limited to
six percent of its oil related production activities income. Sec.
199(d)(9).
\18\In the case of corporate taxpayers that are members of certain
affiliated groups, the deduction is determined by treating all members
of such groups as a single taxpayer and the deduction is allocated
among such members in proportion to each member's respective amount (if
any) of qualified production activities income. Members of an expanded
affiliated group for purposes of the provision generally include those
corporations which would be members of an affiliated group if such
membership were determined based on an ownership threshold of ``more
than 50 percent'' rather than ``at least 80 percent.''
---------------------------------------------------------------------------
However, a taxpayer's deduction under section 199 for a
taxable year may not exceed 50 percent of the wages properly
allocable to domestic production gross receipts paid by the
taxpayer during the calendar year that ends in such taxable
year.\19\
---------------------------------------------------------------------------
\19\For purposes of the provision, wages include the sum of the
amounts of wages as defined in section 3401(a) (i.e., wages subject to
income tax withholding) and elective deferrals that the taxpayer
properly reports to the Social Security Administration with respect to
the employment of employees of the taxpayer during the calendar year
ending during the taxpayer's taxable year. Elective deferrals include
elective deferrals as defined in section 402(g)(3), amounts deferred
under section 457, and, for taxable years beginning after December 31,
2005, designated roth contributions (as defined in section 402A).
---------------------------------------------------------------------------
Qualified production activities income
In general, qualified production activities income is equal
to domestic production gross receipts, reduced by the sum of:
(1) the costs of goods sold that are allocable to such
receipts;\20\ (2) other deductions, expenses, or losses that
are directly allocable to such receipts; and (3) a proper share
of other deductions, expenses, and losses that are not directly
allocable to such receipts or another class of income.\21\
---------------------------------------------------------------------------
\20\For purposes of determining such costs, any item or service
that is imported into the United States without an arm's length
transfer price is treated as acquired by purchase, and its cost shall
be treated as not less than its value when it entered the United
States. A similar rule applies in determining the adjusted basis of
leased or rented property where the lease or rental gives rise to
domestic production gross receipts. With regard to property previously
exported by the taxpayer for further manufacture, the increase in cost
or adjusted basis may not exceed the difference between the value of
the property when exported and the value of the property when re-
imported into the United States after further manufacture. Except as
provided by the Secretary, the value of property for this purpose is
its customs value (as defined in section 1059A(b)(1)).
\21\See Treas. Reg. secs. 1.199-1 through 1.199-9 prescribing rules
for the proper allocation of items of income, deduction, expense, and
loss for purposes of determining qualified production activities
income. Where appropriate, such rules are similar to and consistent
with relevant present-law rules (e.g., sec. 263A, in determining the
cost of goods sold, and sec. 861, in determining the source of such
items). Other deductions, expenses or losses that are directly
allocable to such receipts include, for example, selling and marketing
expenses. A proper share of other deductions, expenses, and losses that
are not directly allocable to such receipts or another class of income
include, for example, general and administrative expenses allocable to
selling and marketing expenses. In computing qualified production
activities income, the domestic production activities deduction itself
is not an allocable deduction.
---------------------------------------------------------------------------
Domestic production gross receipts
Domestic production gross receipts generally are gross
receipts of a taxpayer that are derived from: (1) any sale,
exchange, or other disposition, or any lease, rental, or
license, of qualifying production property that was
manufactured, produced, grown, or extracted by the taxpayer in
whole or in significant part within the United States;\22\ (2)
any sale, exchange or other disposition, or any lease, rental,
or license, of qualified film produced by the taxpayer; (3) any
sale, exchange, or other disposition of electricity, natural
gas, or potable water produced by the taxpayer in the United
States; (4) in the case of a taxpayer engaged in the active
conduct of a construction trade or business, construction
activities performed in the United States;\23\ or (5) in the
case of a taxpayer engaged in the active conduct of an
engineering or architectural services trade or business,
engineering or architectural services performed in the United
States for construction projects located in the United
States.\24\
---------------------------------------------------------------------------
\22\Domestic production gross receipts include gross receipts of a
taxpayer derived from any sale, exchange, or other disposition of
agricultural products with respect to which the taxpayer performs
storage, handling, or other processing activities (other than
transportation activities) within the United States, provided such
products are consumed in connection with, or incorporated into, the
manufacturing, production, growth, or extraction of qualifying
production property (whether or not by the taxpayer).
\23\For this purpose, construction activities include activities
that are directly related to the erection or substantial renovation of
residential and commercial buildings and infrastructure. Substantial
renovation would include structural improvements, but not mere cosmetic
changes, such as painting that is not performed in connection with
activities that otherwise constitute substantial renovation.
\24\With regard to the definition of ``domestic production gross
receipts'' as it relates to construction performed in the United States
and engineering or architectural services performed in the United
States for construction projects in the United States, the term refers
only to gross receipts derived from the construction of real property
by a taxpayer engaged in the active conduct of a construction trade or
business, or from engineering or architectural services performed with
respect to real property by a taxpayer engaged in the active conduct of
an engineering or architectural services trade or business.
---------------------------------------------------------------------------
However, domestic production gross receipts do not include
any gross receipts of the taxpayer derived from property that
is leased, licensed, or rented by the taxpayer for use by any
related person.\25\ Further, domestic production gross receipts
do not include any gross receipts of the taxpayer that are
derived from the sale of food or beverages prepared by the
taxpayer at a retail establishment, that are derived from the
transmission or distribution of electricity, gas, and potable
water, or that are derived from the lease, rental, license,
sale, exchange, or other disposition of land.\26\
---------------------------------------------------------------------------
\26\Sec. 199(c)(4)(B).
\25\Sec. 199(c)(7). In general, principles similar to those under
the extraterritorial income regime apply for this purpose. See Temp.
Treas. Reg. sec. 1.927(a)-1T(f)(2)(i). For example, this exclusion
generally does not apply to property leased by the taxpayer to a
related person if the property is held for sublease, or is subleased,
by the related person to an unrelated person for the ultimate use of
such unrelated person. Similarly, the license of computer software to a
related person for reproduction and sale, exchange, lease, rental or
sublicense to an unrelated person for the ultimate use of such
unrelated person is not treated as excluded property by reason of the
license to the related person.
---------------------------------------------------------------------------
Qualifying production property
Qualifying production property generally includes any
tangible personal property, computer software, or sound
recordings. Qualified film includes any motion picture film or
videotape\27\ (including live or delayed television
programming, but not including certain sexually explicit
productions) if 50 percent or more of the total compensation
relating to the production of such film (including compensation
in the form of residuals and participations)\28\ constitutes
compensation for services performed in the United States by
actors, production personnel, directors, and producers.\29\ A
qualified film also includes any copyrights, trademarks, or
other intangibles with respect to such film. The wage
limitation for qualified films includes any compensation for
services performed in the United States by actors, production
personnel, directors, and producers and is not restricted to W-
2 wages.\30\
---------------------------------------------------------------------------
\27\See Treas. Reg. sec. 1.199-3(k).
\28\To the extent that a taxpayer has included an estimate of
participations and/or residuals in its income forecast calculation
under section 167(g), the taxpayer must use the same estimate of
participations and/or residuals for purposes of determining total
compensation.
\29\Treas. Reg. sec. 1.199-2.
\30\Sec. 199(b)(2)(D). Effective for tax years beginning after
December 31, 2007.
---------------------------------------------------------------------------
Other rules
Partnerships and S corporations.--With respect to the
domestic production activities of a partnership or S
corporation, the deduction under section 199 is applied at the
partner or shareholder level.\31\ In performing the
calculation, each partner or shareholder generally takes into
account such person's allocable share of the components of the
calculation (including domestic production gross receipts; the
cost of goods sold allocable to such receipts; and other
expenses, losses, or deductions allocable to such receipts)
from the partnership or S corporation\32\ as well as any items
relating to the partner's or shareholder's own qualified
production activities, if any. Each partner or shareholder is
treated as having W-2 wages for the taxable year in an amount
equal to such person's allocable share of the W-2 wages of the
partnership or S corporation for the taxable year.\33\
---------------------------------------------------------------------------
\31\Sec. 199(d)(1)(A)(i).
\32\Sec. 199(d)(1)(A)(ii).
\33\Sec. 199(d)(1)(A)(iii).
---------------------------------------------------------------------------
Trusts and estates.--In the case of a trust or estate, the
components of the calculation are apportioned between (and
among) the beneficiaries and the fiduciary under regulations
prescribed by the Secretary.\34\
---------------------------------------------------------------------------
\34\See Treas. Reg. secs. 1.199-5(d) and (e).
---------------------------------------------------------------------------
Agricultural and horticultural cooperatives.--With regard
to member-owned agricultural and horticultural cooperatives
formed under Subchapter T of the Code, section 199 provides the
same treatment of qualified production activities income
derived from agricultural or horticultural products that are
manufactured, produced, grown, or extracted by
cooperatives,\35\ or that are marketed through cooperatives, as
it provides for qualified production activities income of other
taxpayers, that is, the cooperative may claim a deduction from
qualified production activities income.
---------------------------------------------------------------------------
\35\For this purpose, agricultural or horticultural products also
include fertilizer, diesel fuel and other supplies used in agricultural
or horticultural production that are manufactured, produced, grown, or
extracted by the cooperative.
---------------------------------------------------------------------------
Alternatively, section 199 provides that the amount of any
patronage dividends or per-unit retain allocations paid to a
member of an agricultural or horticultural cooperative (to
which Part I of Subchapter T applies), which is allocable to
the portion of qualified production activities income of the
cooperative that is deductible under the provision, is
deductible from the gross income of the member. To qualify,
such amount must be designated by the organization as allocable
to the deductible portion of qualified production activities
income in a written notice mailed to its patrons not later than
the payment period described in section 1382(d). The
cooperative cannot reduce its income under section 1382 (e.g.,
cannot claim a dividends-paid deduction) for such amounts.
Alternative minimum tax.--The deduction for domestic
production activities is allowed for purposes of computing
alternative minimum taxable income (including adjusted current
earnings). The deduction in computing alternative minimum
taxable income is determined by reference to the lesser of the
qualified production activities income (as determined for the
regular tax) or the alternative minimum taxable income (in the
case of an individual, adjusted gross income as determined for
the regular tax) without regard to this deduction.

REASONS FOR CHANGE

The Committee believes that small businesses in the United
States are drivers of economic growth and job creation. With
more resources at their disposal, U.S. small businesses could
invest more in their businesses, hire more employees, and
increase wages. The Committee believes that reducing the
Federal income tax burden on U.S. small businesses can serve to
foster this type of economic and employment growth. H.R. 9,
therefore, effectively reduces the Federal income tax rate for
U.S. small businesses with fewer than 500 employees--regardless
of whether they are organized as passthroughs or as C
corporations--by providing a deduction of up to 20 percent of
qualified domestic business income. The Committee notes that
this definition of small business reflects the definition used
by the Small Business Administration's Office of Advocacy. To
provide an immediate boost to business activity as the economy
continues to struggle, the bill is effective for the first
taxable year of the taxpayer beginning after 2011 and would
benefit employers with 500 or fewer employees in 2010 or 2011.
The Committee believes it is important to establish such a
look-back rule in order to remove any incentive for employers
to let employees go in order to qualify for the tax benefit.
Moreover, the bill provides an incentive for businesses to hire
workers by relating the tax benefit to the amount of W-2 wages
the business pays (with the amounts of its deduction
potentially increasing as its W-2 wage base increases), and
allows the service income of partners with small ownership
stakes to qualify for this limit. In addition, the Committee
recognizes the importance of family-owned and -operated
businesses and notes that H.R. 9 contains certain rules
designed to ensure that many such businesses would be eligible
for this proposed benefit.

EXPLANATION OF PROVISION

In general

W-2 wages

Limitation on deduction
The deduction is limited to 50 percent of the greater of
(1) W-2 wages paid by the taxpayer to non-owner employees, or
(2) the sum of W-2 wages paid by the taxpayer to (a) employees
who are non-owner family members of direct owners and (b)
employees who are 10-percent-or-less direct owners.
W-2 wages
For purposes of the provision, W-2 wages include the sum of
the amounts of wages as defined in section 3401(a) (i.e., wages
subject to income tax withholding) and elective deferrals that
the taxpayer properly reports to the Social Security
Administration with respect to the employment of employees of
the taxpayer during the calendar year ending during the
taxpayer's taxable year. Elective deferrals include elective
deferrals as defined in section 402(g)(3), amounts deferred
under section 457, and designated Roth contributions (as
defined in section 402A).
W-2 wages do not, however, include any amount not properly
allocable to domestic business gross receipts under the
provision, nor does the term include any amount not allowed as
a deduction under section 162 (relating to ordinary and
necessary business expenses).\36\
---------------------------------------------------------------------------
\36\For example, any amount paid to a household employee unrelated
to the employer's trade or business is not allowed as a deduction under
section 162 since the amount is not an ordinary and necessary business
expense. However, amounts paid to employees engaged in the trade or
business (regardless of whether such amounts are capitalized into the
inventory or under any other provision requiring capitalization) would
be qualifying wages for this provision, to the extent such wages are
allocable to domestic business gross receipts.
---------------------------------------------------------------------------
Certain partners' distributive shares of partnership items
may be treated as W-2 wages solely for purposes of the
provision. In the case of a qualified small business that is a
partnership and that so elects, the portion of the qualified
domestic business taxable income of the partnership for the
taxable year that is allocable to each qualified service-
providing partner is treated as W-2 wages paid during that
taxable year to an employee who is a 10-percent-or-less direct
owner. The domestic business gross receipts of the partnership
for the taxable year must be reduced by any amount treated as
W-2 wages under this rule.
Non-owner employee
For purposes of the provision, a non-owner employee of a
qualified small business means a person who does not own (and
is not considered as owning within the meaning of sections
267(c) or (e)(3), as applicable) any stock of the business or,
if the business is not a corporation, any capital or profits
interest of the business.
Non-owner family member employee
For purposes of this provision, an individual is a non-
owner family member of a direct owner if the individual is
family (within the meaning of section 267(c)(4)\37\) of a
direct owner and would be considered a non-owner if sections
267(c) and (e)(3) were applied without regard to section
267(c)(2).\38\ For example, if the son of a direct owner of a
corporation is not, himself, a direct owner of the stock of the
corporation, is employed by the corporation, and receives W-2
wages from the corporation, the son is considered a non-owner
family member of a direct owner.
---------------------------------------------------------------------------
\37\For this purpose, family includes only brothers and sisters
(whether by the whole or half blood), spouse, ancestors, and lineal
descendents.
\38\Sections 267(c) and (e)(3) provide constructive ownership rules
for stock and passthrough entities. Section 267(c)(2) treats an
individual as owning interests owned by the individual's family.
---------------------------------------------------------------------------
Direct owner
For purposes of this provision, a direct owner of a
qualified small business is a person who owns (or is considered
as owning under sections 267(c) or (e)(3) applied without
regard to section 267(c)(2)) any stock of such business or, if
the business is not a corporation, any capital or profits
interest of the qualified small business. Thus, for example, in
the case of tiered partnerships, for this purpose, a person who
owns an interest in an upper-tier partnership is considered to
own an interest in a lower-tier partnership that is a qualified
small business.
10-percent-or-less direct owner
For purposes of the provision, in the case of a qualified
small business that is a corporation, a 10-percent-or-less
direct owner means a direct owner who owns not more than 10
percent of the outstanding stock of the corporation or stock
possessing not more than 10 percent of the total combined
voting power of all stock of the corporation. In the case of a
qualified small business that is not a corporation, a 10-
percent-or-less direct owner means a person who owns not more
than 10 percent of the capital or profits interest in the
qualified small business.
Qualified service-providing partner
For purposes of this provision, a qualified service-
providing partner is any partner who is a 10-percent-or-less
direct owner and who materially participates in the trade or
business to which the qualified domestic business income
relates.

Qualified domestic business income

In general
Qualified domestic business income, for any taxable year,
means the excess (if any) of (1) the taxpayer's domestic
business gross receipts for the taxable year, over the sum of
(2) cost of goods sold allocable to such receipts, and the
other expenses, losses, or deductions (other than the deduction
allowed under this provision) that are properly allocable to
such receipts.
Domestic business gross receipts
Domestic business gross receipts means the gross receipts
of the taxpayer that is a qualified small business which are
effectively connected with the conduct of a trade or business
within the United States within the meaning of section 864(c)
determined without regard to paragraphs (3), (4), and (5)
thereof and substituting ``qualified small business (within the
meaning of section 200)'' for ``nonresident alien individual or
a foreign corporation'' each place it appears therein. Domestic
business gross receipts do not include (1) gross receipts
derived from the sale or exchange of a capital asset or
property used in the trade or business (as defined in section
1231(b)), (2) royalties, rents, dividends, interest, or
annuities, and (3) any amount which constitutes wages (as
defined in section 3401).

Qualified small business

For purposes of the provision, a qualified small business
means an employer engaged in a trade or business if the
employer had fewer than 500 full-time equivalent employees
(``FTEs'')\39\ for either calendar year 2010 or 2011. For
example, a C corporation, S corporation, partnership, or sole
proprietorship with fewer than 500 FTEs in either calendar year
2010 or 2011 may be a qualified small business. In the case of
an employer not in existence on January 1, 2012, the
determination is made with respect to calendar year 2012 rather
than 2010 or 2011.
---------------------------------------------------------------------------
\39\The term full-time equivalent employees for this purpose has
the meaning given under section 45R(d)(2), without regard to section
45R(d)(5) and (e)(1) and by applying that subsection on a calendar year
rather than a taxable year basis. Thus, for this purpose, seasonal
employees and self-employed individuals, including partners and sole
proprietors, two percent shareholders of an S corporation and five
percent owners of the employer are included in the calculation of an
employer's FTEs.
---------------------------------------------------------------------------
In general, an employer's FTEs are calculated by dividing
the total hours of service for which wages were paid by the
employer to employees during the taxable year by 2,080
hours.\40\ This number is rounded down to the nearest whole
number if not otherwise a whole number. Employers in existence
for a partial calendar year annualize the number of FTEs
calculated based on the number of calendar days the taxpayer
was in existence during 2012.
---------------------------------------------------------------------------
\40\For employees who work in excess of 2,080 hours during any
taxable year, the excess is not taken into account. See sec.
45R(d)(2)(B).
---------------------------------------------------------------------------
Any employer that is treated as a single employer for
purposes of section 52(a) or (b) (without regard to section
1563(b)), relating to employees of entities under common
control, or section 414(m) or (o), relating to employees of an
affiliated service group, is treated as a single employer for
purposes of determining whether an employer is a qualified
small business.

Other rules

Application to passthrough entities and individuals
For purposes of this provision, rules similar to the rules
under section 199 (described above) apply with respect to
partnerships, S corporations, trusts or estates, or
agricultural and horticultural cooperatives.\41\ Rules similar
to the rules under section 199 also apply with respect to
individuals.\42\
---------------------------------------------------------------------------
\41\See sec. 199(d)(1) and (3).
\42\See sec. 199(d)(2).
---------------------------------------------------------------------------
Special rule for affiliated groups
All members of an expanded affiliated group are treated as
a single corporation for purposes of the provision.\43\ Rules
similar to the rules under section 199 apply to allocate the
deduction among the members of the expanded affiliated
group.\44\
---------------------------------------------------------------------------
\43\Members of an expanded affiliated group for purposes of this
provision generally include those corporations which would be members
of an affiliated group if such membership were determined based on an
ownership threshold of ``more than 50 percent'' rather than ``at least
80 percent.''
\44\See sec. 199(d)(4).
---------------------------------------------------------------------------
Alternative minimum tax
The deduction for qualified domestic business income is
allowed for purposes of computing alternative minimum taxable
income (including adjusted current earnings). The deduction in
computing alternative minimum taxable income is determined by
reference to the lesser of the qualified domestic business
income (as determined for the regular tax) or the alternative
minimum taxable income (in the case of an individual, adjusted
gross income as determined for the regular tax) without regard
to this deduction.
Coordination with section 199
If a taxpayer is allowed a deduction under this provision
for a taxable year, gross receipts of the taxpayer taken into
account under this provision cannot be taken into account under
section 199 for the taxable year. Similarly, W-2 wages taken
into account under this provision cannot be taken into account
under section 199 (which also has a limitation related to W-2
wages) for the taxable year. As a result, the taxpayer may not
benefit under this provision and under section 199 with respect
to the same gross receipts or W-2 wages.
A taxpayer may elect not to take into account under this
provision any item of domestic business gross receipts. Under
this election, for example, the taxpayer may treat an item of
domestic business gross receipts as not taken into account
under the provision so that the item may be taken into account
for purposes of section 199.
Regulations
The Treasury Department is directed to prescribe guidance
necessary to carry out the purposes of the provision. This
guidance is to include rules preventing a taxpayer that
reorganizes or changes its structure from being treated as a
qualified small business if it would not have been so treated
prior to the reorganization or structural change. The guidance
is also to provide rules preventing taxpayers from obtaining a
deduction under both section 199 and this provision based on
the same gross receipts or W-2 wages.

EFFECTIVE DATE

The provision applies only with respect to the first
taxable year of the taxpayer beginning after December 31, 2011.

III. VOTES OF THE COMMITTEE

In compliance with clause 3(b) of rule XIII of the Rules of
the House of Representatives, the following statements are made
concerning the votes of the Committee on Ways and Means in its
consideration of H.R. 9, the ``Small Business Tax Cut Act.''

MOTION TO REPORT RECOMMENDATIONS

The bill, H.R. 9, was ordered favorably reported as amended
by a roll call vote of 21 yeas to 14 nays (with a quorum being
present). The vote was as follows:

----------------------------------------------------------------------------------------------------------------
Representative Yea Nay Present Representative Yea Nay Present
----------------------------------------------------------------------------------------------------------------
Mr. Camp....................... X ........ ......... Mr. Levin........ ........ X .........
Mr. Herger..................... X ........ ......... Mr. Rangel....... ........ ........ .........
Mr. Johnson.................... X ........ ......... Mr. Stark........ ........ X .........
Mr. Brady...................... X ........ ......... Mr. McDermott.... ........ X .........
Mr. Ryan....................... X ........ ......... Mr. Lewis........ ........ X .........
Mr. Nunes...................... X ........ ......... Mr. Neal......... ........ X .........
Mr. Tiberi..................... X ........ ......... Mr. Becerra...... ........ X .........
Mr. Davis...................... X ........ ......... Mr. Doggett...... ........ X .........
Mr. Reichert................... X ........ ......... Mr. Thompson..... ........ X .........
Mr. Boustany................... X ........ ......... Mr. Larson....... ........ X .........
Mr. Roskam..................... X ........ ......... Mr. Blumenauer... ........ X .........
Mr. Gerlach.................... X ........ ......... Mr. Kind......... ........ X .........
Mr. Price...................... X ........ ......... Mr. Pascrell..... ........ X .........
Mr. Buchanan................... X ........ ......... Ms. Berkley...... ........ X .........
Mr. Smith...................... X ........ ......... Mr. Crowley...... ........ X .........
Mr. Schock..................... X ........ .........
Ms. Jenkins.................... X ........ .........
Mr. Paulsen.................... X ........ .........
Mr. Marchant................... ........ ........ .........
Mr. Berg....................... X ........ .........
Ms. Black...................... X ........ .........
Mr. Reed....................... X ........ .........
----------------------------------------------------------------------------------------------------------------

VOTES ON AMENDMENTS AND OTHER MOTIONS

The vote on the motion by Mr. Brady to table Mr. Becerra's
challenge to the rule of the Chair was agreed to by a roll call
vote of 20 yeas to 14 nays (with a quorum being present). The
vote was as follows:

----------------------------------------------------------------------------------------------------------------
Representative Yea Nay Present Representative Yea Nay Present
----------------------------------------------------------------------------------------------------------------
Mr. Camp....................... X ........ ......... Mr. Levin........ ........ X .........
Mr. Herger..................... X ........ ......... Mr. Rangel....... ........ ........ .........
Mr. Johnson.................... X ........ ......... Mr. Stark........ ........ X .........
Mr. Brady...................... X ........ ......... Mr. McDermott.... ........ X .........
Mr. Ryan....................... X ........ ......... Mr. Lewis........ ........ X .........
Mr. Nunes...................... X ........ ......... Mr. Neal......... ........ X .........
Mr. Tiberi..................... X ........ ......... Mr. Becerra...... ........ X .........
Mr. Davis...................... X ........ ......... Mr. Doggett...... ........ X .........
Mr. Reichert................... X ........ ......... Mr. Thompson..... ........ X .........
Mr. Boustany................... X ........ ......... Mr. Larson....... ........ X .........
Mr. Roskam..................... ........ ........ ......... Mr. Blumenauer... ........ X .........
Mr. Gerlach.................... X ........ ......... Mr. Kind......... ........ X .........
Mr. Price...................... X ........ ......... Mr. Pascrell..... ........ X .........
Mr. Buchanan................... X ........ ......... Ms. Berkley...... ........ X .........
Mr. Smith...................... X ........ ......... Mr. Crowley...... ........ X .........
Mr. Schock..................... X ........ .........
Ms. Jenkins.................... X ........ .........
Mr. Paulsen.................... X ........ .........
Mr. Marchant................... ........ ........ .........
Mr. Berg....................... X ........ .........
Ms. Black...................... X ........ .........
Mr. Reed....................... X ........ .........
----------------------------------------------------------------------------------------------------------------

The vote on the motion by Mr. Brady to table Mr.
McDermott's motion to appeal the ruling of the Chair was agreed
to by a roll call vote of 21 yeas and 13 nays (with a quorum
being present). The vote was as follows:

----------------------------------------------------------------------------------------------------------------
Representative Yea Nay Present Representative Yea Nay Present
----------------------------------------------------------------------------------------------------------------
Mr. Camp....................... X ........ ......... Mr. Levin........ ........ X .........
Mr. Herger..................... X ........ ......... Mr. Rangel....... ........ ........ .........
Mr. Johnson.................... X ........ ......... Mr. Stark........ ........ X .........
Mr. Brady...................... X ........ ......... Mr. McDermott.... ........ X .........
Mr. Ryan....................... X ........ ......... Mr. Lewis........ ........ X .........
Mr. Nunes...................... X ........ ......... Mr. Neal......... ........ X .........
Mr. Tiberi..................... X ........ ......... Mr. Becerra...... ........ X .........
Mr. Davis...................... X ........ ......... Mr. Doggett...... ........ X .........
Mr. Reichert................... X ........ ......... Mr. Thompson..... ........ X .........
Mr. Boustany................... X ........ ......... Mr. Larson....... ........ X .........
Mr. Roskam..................... X ........ ......... Mr. Blumenauer... ........ X .........
Mr. Gerlach.................... X ........ ......... Mr. Kind......... ........ ........ .........
Mr. Price...................... X ........ ......... Mr. Pascrell..... ........ X .........
Mr. Buchanan................... X ........ ......... Ms. Berkley...... ........ X .........
Mr. Smith...................... X ........ ......... Mr. Crowley...... ........ X .........
Mr. Schock..................... X ........ .........
Ms. Jenkins.................... X ........ .........
Mr. Paulsen.................... X ........ .........
Mr. Marchant................... ........ ........ .........
Mr. Berg....................... X ........ .........
Ms. Black...................... X ........ .........
Mr. Reed....................... X ........ .........
----------------------------------------------------------------------------------------------------------------

The vote on the amendment by Mr. Crowley to the amendment
in the nature of a substitute, which would deny the deduction
in certain circumstances, was not agreed to by a roll call vote
of 21 nays to 14 yeas (with a quorum being present). The vote
was as follows:

----------------------------------------------------------------------------------------------------------------
Representative Yea Nay Present Representative Yea Nay Present
----------------------------------------------------------------------------------------------------------------
Mr. Camp....................... ........ X ......... Mr. Levin........ X ........ .........
Mr. Herger..................... ........ X ......... Mr. Rangel....... ........ ........ .........
Mr. Johnson.................... ........ X ......... Mr. Stark........ X ........ .........
Mr. Brady...................... ........ X ......... Mr. McDermott.... X ........ .........
Mr. Ryan....................... ........ X ......... Mr. Lewis........ X ........ .........
Mr. Nunes...................... ........ X ......... Mr. Neal......... X ........ .........
Mr. Tiberi..................... ........ X ......... Mr. Becerra...... X ........ .........
Mr. Davis...................... ........ X ......... Mr. Doggett...... X ........ .........
Mr. Reichert................... ........ X ......... Mr. Thompson..... X ........ .........
Mr. Boustany................... ........ X ......... Mr. Larson....... X ........ .........
Mr. Roskam..................... ........ X ......... Mr. Blumenauer... X ........ .........
Mr. Gerlach.................... ........ X ......... Mr. Kind......... X ........ .........
Mr. Price...................... ........ X ......... Mr. Pascrell..... X ........ .........
Mr. Buchanan................... ........ X ......... Ms. Berkley...... X ........ .........
Mr. Smith...................... ........ X ......... Mr. Crowley...... X ........ .........
Mr. Schock..................... ........ X .........
Ms. Jenkins.................... ........ X .........
Mr. Paulsen.................... ........ X .........
Mr. Marchant................... ........ ........ .........
Mr. Berg....................... ........ X .........
Ms. Black...................... ........ X .........
Mr. Reed....................... ........ X .........
----------------------------------------------------------------------------------------------------------------

IV. BUDGET EFFECTS OF THE BILL

A. Committee Estimate of Budgetary Effects

In compliance with clause 3(d) of rule XIII of the Rules of
the House of Representatives, the following statement is made
concerning the effects on the budget of the revenue provisions
of the bill, H.R. 9, as reported.
The bill is estimated to have the following effects on
Federal budget receipts for fiscal years 2012-2022:

FISCAL YEARS
[Millions of dollars]
----------------------------------------------------------------------------------------------------------------
Item 2012 2013 2014 2015 2016 2017 2012-17 2012-22
----------------------------------------------------------------------------------------------------------------
20-Percent Business Deduction.... -12,526 -32,714 -709 ...... ...... ...... -45,950 -45,950
----------------------------------------------------------------------------------------------------------------

B. Statement Regarding New Budget Authority and Tax Expenditures Budget
Authority

In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee states that the
bill involves no new or increased budget authority. The
Committee further states that the revenue reducing income tax
provisions involve increased tax expenditures. (See amounts in
table in Part IV.A., above.)

C. Cost Estimate Prepared by the Congressional Budget Office

In compliance with clause 3(c)(3) of rule XIII of the Rules
of the House of Representatives, requiring a cost estimate
prepared by the CBO, the following statement by CBO is
provided.

U.S. Congress,
Congressional Budget Office,
Washington, DC, April 9, 2012.
Hon. Dave Camp,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 9, the Small
Business Tax Cut Act.
If you wish further details on this estimate, we will be
pleased to provide them. The staff contact is Kalyani
Parthasarathy.
Sincerely,
Douglas W. Elmendorf.
Enclosure.

H.R. 9--Small Business Tax Cut Act

H.R. 9 would amend the Internal Revenue Code to permit
certain small businesses to deduct from their taxable income up
to 20 percent of their qualifying domestic business income. The
deduction would apply only to the entity's first taxable year
that begins after December 31, 2011, and it could not exceed 50
percent of certain wages that the firm pays or reduce the
firm's taxable income below zero. The staff of the Joint
Committee on Taxation (JCT) estimates that enacting H.R. 9
would reduce revenues, thus increasing federal budget deficits
by $46 billion over the 2012-2022 period.
H.R. 9 would define qualifying domestic business income as
the excess of gross receipts earned from domestic activities
over all costs, expenses, or other deductions related to such
receipts. A small business would be eligible for the deduction
if it engaged in a trade or business and had fewer than 500
full-time equivalent employees in either calendar year 2010 or
2011. If the business was not in existence in those years, then
the test would be applied to the firm in 2012.
The Statutory Pay-As-You-Go Act of 2010 establishes budget
reporting and enforcement procedures for legislation affecting
direct spending and revenues. Enacting H.R. 9 would result in
revenue losses in each year from 2012 to 2014. The net change
in revenues is shown in the following table.

CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS OF H.R. 9, AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON WAYS AND MEANS ON MARCH 28, 2012
--------------------------------------------------------------------------------------------------------------------------------------------------------
By fiscal year, in millions of dollars--
------------------------------------------------------------------------------------------------------
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2012-2017 2012-2022
--------------------------------------------------------------------------------------------------------------------------------------------------------
NET INCREASE OR DECREASE (-) IN THE DEFICIT

Statutory Pay-As-You-Go Impact................... 12,526 32,714 709 0 0 0 0 0 0 0 0 45,950 45,950
--------------------------------------------------------------------------------------------------------------------------------------------------------

JCT has determined that the bill contains no
intergovernmental or private-sector mandates as defined in the
Unfunded Mandates Reform Act.
The CBO staff contact for this estimate is Kalyani
Parthasarathy. The estimate was approved by Frank Sammartino,
Assistant Director for Tax Analysis.

D. Macroeconomic Impact Analysis

In compliance with clause 3(h)(2) of rule XIII of the Rules
of the House of Representatives, the following statement is
made by the Joint Committee on Taxation with respect to the
provisions of H.R. 9: the effects of the bill on economic
activity are so small as to be incalculable within the context
of a model of the aggregate economy.
The bill will potentially have small, temporary stimulative
effects. It will temporarily increase after-tax income for the
owners of certain firms with fewer than 500 employees, enabling
these taxpayers to increase their purchase of goods and
services. Because the economy is currently operating at less
than full employment, this additional demand is likely to have
a temporary stimulus effect, resulting in a small increase in
real Gross Domestic Product (``GDP'') during the time the
provision is in effect (in 2012 and for some taxpayers part of
2013, depending on their taxable year). The size of this
stimulus effect depends on how much of the after-tax income the
business owners choose to spend, which is uncertain. The size
of the tax reduction ($45.9 billion) is quite small relative to
the size of the economy (0.003 percent of projected GDP in
2012), which means the stimulus effect will also be quite
small. As the tax reduction expires, the stimulus effect also
expires.
In addition, the bill provides an incentive to shift
profits to the period when they are taxed at lower effective
rates. Firms have an incentive to shift sales, and, if
necessary, commensurate production and employment, into the
period of the tax deduction. However, this incentive is
partially offset by associated adjustment costs, such as
additional overtime or hiring costs, and additional wear and
tear on equipment. The formula for determining the amount of
the business deduction makes it possible for firms to maximize
the deduction bonus without increasing output. Firms might not
need to increase their productive capacity to take full
advantage of the tax benefits of the bill. To the extent that
firms could increase sales and or payroll to take advantage of
the extra deduction without increasing longer-term costs, they
can be expected to do that. Thus, the bill is likely to result
in some acceleration of sales into the current taxable year,
but very little change in output over the budget period.
The temporary nature of the bill significantly limits
incentives it might otherwise provide for a direct increase in
production by the affected firms. Generally, a longer-term
reduction in taxation of business profits of the type that is
provided for only one year in this bill would increase the rate
of return to production, thus providing businesses with an
incentive to increase investment and output. However, the one
year of tax savings provided by the bill is unlikely to make
the costs of much investment in physical capital or labor
recruitment and training worthwhile.
The increase in the deficit as a result of the bill may
slightly increase long-term interest rates. In the near term,
this effect is likely to be negligible both because the economy
is currently operating below capacity, and because the Federal
Reserve Board has announced an intention to keep interest rates
low through 2014. Because the provision is temporary, there is
no offsetting permanent increase in after-tax capital returns.
Thus, the incentive for long-term capital investment is reduced
in the future, putting slight downward pressure on economic
growth.

V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE

A. Committee Oversight Findings and Recommendations

With respect to clause 3(c)(1) of rule XIII of the Rules of
the House of Representatives (relating to oversight findings),
the Committee advises that it was as a result of the
Committee's review of the provisions of H.R. 9 that the
Committee concluded that it is appropriate to report the bill,
as amended, to the House of Representatives with the
recommendation that the bill do pass.

B. Statement of General Performance Goals and Objectives

With respect to clause 3(c)(4) of rule XIII of the Rules of
the House of Representatives, the Committee advises that the
bill contains no measure that authorizes funding, so no
statement of general performance goals and objectives for which
any measure authorizes funding is required.

C. Information Relating to Unfunded Mandates

This information is provided in accordance with section 423
of the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104-
4).
The Committee has determined that the reported bill does
not contain any Federal private sector mandates within the
meaning of Public Law No. 104-4, the Unfunded Mandates Reform
Act of 1995. The costs required to comply with each Federal
private sector mandate generally are no greater than the
aggregate estimated budget effects of the provision.
The Committee has determined that the revenue provisions of
the bill do not impose a Federal intergovernmental mandate on
State, local, or tribal governments.

D. Applicability of House Rule XXI 5(b)

Clause 5(b) of rule XXI of the Rules of the House of
Representatives provides, in part, that ``A bill or joint
resolution, amendment, or conference report carrying a Federal
income tax rate increase may not be considered as passed or
agreed to unless so determined by a vote of not less than
three-fifths of the Members voting, a quorum being present.''
The Committee has carefully reviewed the provisions of the
bill, and states that the provisions of the bill do not involve
any Federal income tax rate increases within the meaning of the
rule.

E. Tax Complexity Analysis

Section 4022(b) of the Internal Revenue Service Reform and
Restructuring Act of 1998 (the ``IRS Reform Act'') requires the
Joint Committee on Taxation (in consultation with the Internal
Revenue Service and the Department of the Treasury) to provide
a tax complexity analysis. The complexity analysis is required
for all legislation reported by the Senate Committee on
Finance, the House Committee on Ways and Means, or any
committee of conference if the legislation includes a provision
that directly or indirectly amends the Internal Revenue Code
and has widespread applicability to individuals or small
businesses. Pursuant to clause 3(h)(1) of rule XIII of the
Rules of the House of Representatives, a summary description of
that provision is provided, along with an estimate of the
number and type of affected taxpayers, and a discussion
regarding the relevant complexity and administrative issues.
Following the analysis of the staff of the Joint Committee
on Taxation are the comments of the IRS and the Treasury
Department regarding each of the provisions included in the tax
complexity analysis, including a discussion of the likely
effect on IRS forms and any expected impact on the IRS.

Summary description of the provision

In the case of a qualified small business, the provision
allows a deduction for 20 percent of qualified domestic
business income of the taxpayer for the taxable year, or
taxable income for the taxable year, whichever is less.
However, a taxpayer's deduction for any taxable year is limited
to 50 percent of the greater of (1) W-2 wages paid by the
taxpayer to non-owner employees, or (2) the sum of W-2 wages
paid by the taxpayer to (a) employees who are non-owner family
members of direct owners and (b) employees who are 10 percent-
or-less direct owners.
For purposes of the provision, a qualified small business
means an employer engaged in a trade or business that employed
fewer than 500 full-time equivalent employees for either
calendar year 2010 or 2011. Any employer treated as a single
employer for purposes of section 52(a) or (b) (without regard
to section 1563(b)), or section 414(m) or (o) is treated as a
single employer for this purpose. Qualified domestic business
income means the excess (if any) of (1) the taxpayer's gross
receipts effectively connected with a trade or business in the
United States, over (2) the sum of cost of goods sold,
expenses, losses, and other deductions properly allocable to
such receipts. For purposes of this provision, W-2 wages
include (1) wages as defined in section 3401(a), (2) elective
deferrals reported to the Social Security Administration, and
(3) certain partners' distributive share of partnership items
if the partnership so elects. A partnership can elect to treat
partnership income allocable to partners who materially
participate in the related trade or business, and who own 10
percent or less of the partnership, as W-2 wages for purposes
of this provision.
Deductions cannot be taken under the provision and present
law section 199 with respect to the same gross receipts.
Similarly, W-2 wages taken into account under the provision
cannot also be taken into account under section 199. Rules
similar to those applicable for section 199 in the case of
partnerships, S corporations, trusts and estates, and
agricultural and horticultural cooperatives apply for purposes
of the provision.
The provision applies only with respect to the first
taxable year of the taxpayer beginning after December 31, 2011.

Number of affected taxpayers

It is estimated that the provision will affect more than 10
percent of small businesses and individuals.

Discussion

It is anticipated that small businesses that elect to apply
the provision will need to keep additional records due to this
provision, and that additional regulatory guidance will be
necessary to effectively implement the provision. It is
anticipated that the provision will result in an increase in
disputes between small businesses and the IRS. Reasons for such
disputes include the complexity of the provision and the
inherent incentive for taxpayers to maximize the deduction.
The provision likely will increase the tax preparation
costs for most affected small businesses. Small businesses will
have to perform additional analysis concerning whether the
small business had no more than 500 employees and which income
qualifies for the deduction allowed under the provision. For
income that is determined to be eligible for the deduction
under the provision, small businesses will be required to
perform additional calculations to determine the amount of the
deduction under the provision. Because the deduction is based
upon qualified domestic business income rather than gross
income, small businesses will be required to undertake
calculations to determine the amounts of costs that are
allocable to domestic business gross receipts. In some cases,
small businesses would not have been required otherwise to
perform these calculations but for the provision.
The wage limitation on the deduction is likely to impact
small businesses disproportionately. Small businesses will have
to perform additional analysis concerning the amount of wages
paid to non-owner employees, employees who are family members
of direct owners, and employees who are 10 percent-or-less
direct owners. Small businesses that are partnerships will have
to analyze whether to elect to treat partnership income
allocable to partners who materially participate in the related
trade or business, and who own 10 percent or less of the
partnership, as W-2 wages for purposes of this provision. After
undertaking analyses to determine the amount of their potential
deduction, many small businesses will find that such amount is
significantly reduced or eliminated by the wage limitation.
Small businesses may wish to increase or decrease wages paid to
employees in various categories or hire additional employees in
various categories in order to maximize the deduction under
this provision. Small businesses affected by the wage
limitation may wish to take certain gross receipts into account
under section 199 instead of this provision.
Due to the detailed calculations required by the provision,
it is anticipated that the Secretary of the Treasury will have
to create a new form for qualified small businesses to compute
the deduction and will have to make appropriate revisions to
several types of income tax forms and instructions. In
addition, the Secretary of the Treasury will have to issue
guidance to carry out the purposes of the provision, including
rules preventing a taxpayer that reorganizes or changes its
structure from being treated as a qualified small business if
it would not have been so treated prior to the reorganization
or structural change and rules preventing taxpayers from
obtaining a deduction under both section 199 and this provision
based on the same gross receipts or W-2 wages.

COMMENTS FROM IRS AND TREASURY

Department of the Treasury,
Internal Revenue Service,
Washington, DC, April 3, 2012.
Mr. Thomas A. Barthold,
Chief of Staff, Joint Committee on Taxation,
Washington, D.C.
Dear Mr. Barthold: I am responding to your letter dated
March 29, 2012, in which you requested a complexity analysis
related to the deduction for domestic business income of
qualified small businesses enacted under section 2 of the Small
Business Tax Cut Act.
Enclosed are the combined comments of the Internal Revenue
Service and the Treasury Department for inclusion in the
complexity analysis in the Conference Report on H.R. 9.
Our comments are based on the description of the provision
provided in your letter. The analysis does not include
administrative cost estimates for the changes that would be
required. Due to the short turnaround time, our comments are
provisional and subject to change upon a more complete and in-
depth analysis of the provision. The analysis does not cover
any other provisions of the bill.
Sincerely,
Douglas H. Shulman.
Enclosure.

Complexity Analysis of the Conference Report on H.R. 9, Small Business
Tax Cut Act

DEDUCTION FOR DOMESTIC BUSINESS INCOME OF QUALIFIED SMALL BUSINESSES

In the case of a qualified small business, the provision
allows a deduction of up to 20 percent of the qualified
domestic business income of the taxpayer for the taxable year.
The deduction is limited to the lesser of (1) 20 percent of the
taxpayer's taxable income or (2) 50 percent of certain W-2
wages paid (or in some cases, deemed paid) by the taxpayer.
For purposes of the provision, a qualified small business
means an employer engaged in a trade or business that employed
fewer than 500 full-time equivalent employees for either
calendar year 2010 or 2011. Any employer treated as a single
employer for purposes of section 52(a) or (b) (without regard
to section 1563(b) or section 414(m) or (o) is treated as a
single employer for this purpose. Qualified domestic business
income means the excess (if any) of (1) the taxpayer's gross
receipts effectively connected with a trade or business in the
United States, over (2) the sum of cost of goods sold,
expenses, losses, and other deductions properly allocable to
such receipts. W-2 wages include (1) wages as defined in
section 3401(a) and (2) elective deferrals reported to the
Social Security Administration and, solely for purposes of the
provision (3) certain partners' distributive share of
partnership items if the partnership so elects. A partnership
can elect to treat partnership income allocable to partners who
materially participate in the related trade or business, and
who own 10 percent or less of the partnership, as W-2 wages for
purposes of this provision.
Deductions cannot be taken under the provision and present
law section 199 with respect to the same gross receipts.
Similarly, W-2 wages taken into account under the provision
cannot also be taken into account under section 199. Rules
similar to those applicable for section 199, in the case of
partnerships, S corporations, trusts and estates and
agricultural and horticultural cooperatives, apply for purposes
of the provision.
The provision applies only with respect to the first
taxable year of the taxpayer beginning after December 31, 2011.

IRS and Treasury Comments

The provision applies at the individual and
corporate level and would ``follow'' the present law section
199 rules [Domestic Production Activities Deduction (DPAD)].
The provision is, for the most part, taken in lieu
of the section 199 DPAD (which is calculated on the current
Form 8903).
A new form 8903-A would need to be developed for
this deduction.
Where the deduction is calculated on the current
Form 8903 and carried forward to the various individual and
corporate tax return lines, this deduction would be calculated
on new Form 8903-A and carried forward to the same various
individual and corporate tax return lines.
The new Form 8903-A would be complicated and would
be similar to current Form 8903 but without the column for oil
and gas. Form 1040, Line 35, and Form 1120, Line 25, allow for
the DAPD and indicates the taxpayer should attach Form 8903.
The reference to attaching Form 8903 on this line
would need to be modified to indicate attachment of either Form
8903 or new Form 8903-A.
Form 6251, Alternative Minimum Tax: The form may
need to be modified.
Form 1065, Partnership Income Tax Return: The
deduction would be applied at the partner level. The deduction
from this provision would be a separately stated item on
Schedule K and Schedule K-1. The instructions for both would
need modification and a new letter code would need to be added
to Schedule K-1.
Form 1120S, S Corporation Income Tax Return: The
deduction would be applied at the shareholder level. As such,
applicable modifications to the instructions for Schedule K-1
would be needed.
IRS would need to communicate and educate internal
and external stakeholders regarding the new law.
New guidance in the form of a Notice or other
vehicle as well as Regulations would be required.
Limited changes would be needed to the affected
IRM sections.
IRS may need to modify existing tax systems to
reflect this provision.
If this line item is to be transcribed, additional
resources would be needed.
Policies, procedures and analysis of transcription
results would require additional resources.
Disputes between taxpayers and IRS may arise about
the definition of a qualified small business, the type of
employer and the type of trade or business, the FTE
calculation, application at the partner or shareholder level,
the definition of domestic production gross receipts, the
definition of qualifying production property; the definitions
of service-providing partner; non-owner employees, non-owner
family member of direct owners; and the calculation of the
possible 20 percent deduction.

F. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff
Benefits

With respect to clause 9 of rule XXI of the Rules of the
House of Representatives, the Committee has carefully reviewed
the provisions of the bill and states that the provisions of
the bill as reported contain no congressional earmarks, limited
tax benefits, or limited tariff benefits within the meaning of
that rule.

VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):

INTERNAL REVENUE CODE OF 1986

Subtitle A--Income Taxes

* * * * * * *

CHAPTER 1--NORMAL TAXES AND SURTAXES

* * * * * * *

Subchapter A--Determination of Tax Liability

* * * * * * *

PART VI--ALTERNATIVE MINIMUM TAX

* * * * * * *

SEC. 56. ADJUSTMENTS IN COMPUTING ALTERNATIVE MINIMUM TAXABLE INCOME.

(a) * * *

* * * * * * *

(d) Alternative Tax Net Operating Loss Deduction Defined.--
(1) In general.--For purposes of subsection (a)(4),
the term ``alternative tax net operating loss
deduction'' means the net operating loss deduction
allowable for the taxable year under section 172,
except that--
(A) the amount of such deduction shall not
exceed the sum of--
(i) the lesser of--
(I) * * *
(II) 90 percent of
alternative minimum taxable
income determined without
regard to such deduction and
the [deduction under section
199] deductions under sections
199 and 200, plus
(ii) the lesser of--
(I) * * *
(II) alternative minimum
taxable income determined
without regard to such
deduction and the [deduction
under section 199] deductions
under sections 199 and 200
reduced by the amount
determined under clause (i),
and

* * * * * * *

(g) Adjustments Based on Adjusted Current Earnings.--
(1) * * *

* * * * * * *

(4) Adjustments.--In determining adjusted current
earnings, the following adjustments shall apply:
(A) * * *

* * * * * * *

(vii) Deduction for domestic business
income of qualified small businesses.--
Clause (i) shall not apply to any
amount allowable as a deduction under
section 200.

* * * * * * *

Subchapter B--Computation of Taxable Income

* * * * * * *

PART II--ITEMS SPECIFICALLY INCLUDED IN GROSS INCOME

* * * * * * *

SEC. 86. SOCIAL SECURITY AND TIER 1 RAILROAD RETIREMENT BENEFITS.

(a) * * *
(b) Taxpayers to Whom Subsection (a) Applies.--
(1) * * *
(2) Modified adjusted gross income.--For purposes of
this subsection, the term ``modified adjusted gross
income'' means adjusted gross income--
(A) determined without regard to this section
and sections 135, 137, 199, 200, 221, 222, 911,
931, and 933, and

* * * * * * *

PART III--ITEMS SPECIFICALLY EXCLUDED FROM GROSS INCOME

* * * * * * *

SEC. 135. INCOME FROM UNITED STATES SAVINGS BONDS USED TO PAY HIGHER
EDUCATION TUITION AND FEES.

(a) * * *

* * * * * * *

(4) Modified adjusted gross income.--The term
``modified adjusted gross income'' means the adjusted
gross income of the taxpayer for the taxable year
determined--
(A) without regard to this section and
sections 137, 199, 200, 221, 222, 911, 931, and
933, and

* * * * * * *

SEC. 137. ADOPTION ASSISTANCE PROGRAM.

(a) * * *
(b) Limitations.--
(1) * * *

* * * * * * *

(3) Determination of adjusted gross income.--For
purposes of paragraph (2), adjusted gross income shall
be determined--
(A) without regard to this section and
sections 199, 200, 221, 222, 911, 931, and 933,
and

* * * * * * *

PART VI--ITEMIZED DEDUCTIONS FOR INDIVIDUALS AND CORPORATIONS

Sec. 161. Allowance of deductions.
* * * * * * *
Sec. 200. Domestic business income of qualified small businesses.

* * * * * * *

SEC. 163. INTEREST.

(a) * * *

* * * * * * *

(j) Limitation on Deduction for Interest on Certain
Indebtedness.--
(1) * * *

* * * * * * *

(6) Other definitions and special rules.--For
purposes of this subsection--
(A) Adjusted taxable income.--The term
``adjusted taxable income'' means the taxable
income of the taxpayer--
(i) computed without regard to--
(I) * * *

* * * * * * *

(III) any deduction allowable
under section 199, [and]

* * * * * * *

(V) any deduction allowable
under section 200, and

* * * * * * *

SEC. 170. CHARITABLE, ETC., CONTRIBUTIONS AND GIFTS.

(a) * * *
(b) Percentage Limitations.--
(1) * * *
(2) Corporations.--In the case of a corporation--
(A) * * *

* * * * * * *

(iv) section 199, [and]
(v) any capital loss carryback to the
taxable year under section
1212(a)(1)[.], and
(vi) section 200.

* * * * * * *

SEC. 172. NET OPERATING LOSS DEDUCTION.

(a) * * *

* * * * * * *

(d) Modifications.--The modifications referred to in this
section are as follows:
(1) * * *

* * * * * * *

(8) Domestic business income of qualified small
businesses.--The deduction under section 200 shall not
be allowed.

* * * * * * *

SEC. 200. DOMESTIC BUSINESS INCOME OF QUALIFIED SMALL BUSINESSES.

(a) Allowance of Deduction.--In the case of a qualified small
business, there shall be allowed as a deduction an amount equal
to 20 percent of the lesser of--
(1) the qualified domestic business income of the
taxpayer for the taxable year, or
(2) taxable income (determined without regard to this
section) for the taxable year.
(b) Deduction Limited Based on Wages Paid.--
(1) In general.--The amount of the deduction
allowable under subsection (a) for any taxable year
shall not exceed 50 percent of the greater of--
(A) the W-2 wages of the taxpayer paid to
non-owners, or
(B) the sum of--
(i) the W-2 wages of the taxpayer
paid to individuals who are non-owner
family members of direct owners, plus
(ii) any W-2 wages of the taxpayer
paid to 10-percent-or-less direct
owners.
(2) Definitions related to ownership.--For purposes
of this section--
(A) Non-owner.--The term ``non-owner'' means,
with respect to any qualified small business,
any person who does not own (and is not
considered as owning within the meaning of
subsection (c) or (e)(3) of section 267, as the
case may be) any stock of such business (or, if
such business is other than a corporation, any
capital or profits interest of such business).
(B) Non-owner family members.--An individual
is a non-owner family member of a direct owner
if--
(i) such individual is family (within
the meaning of section 267(c)(4)) of a
direct owner, and
(ii) such individual would be a non-
owner if subsections (c) and (e)(3) of
section 267 were applied without regard
to section 267(c)(2).
(C) Direct owner.--The term ``direct owner''
means, with respect to any qualified small
business, any person who owns (or is considered
as owning under the applicable non-family
attribution rules) any stock of such business
(or, if such business is other than a
corporation, any capital or profits interest of
such business).
(D) 10-percent-or-less direct owners.--The
term ``10-percent-or-less direct owner'' means,
with respect to any qualified small business,
any direct owner of such business who owns (or
is considered as owning under the applicable
non-family attribution rules)--
(i) in the case of a qualified small
business which is a corporation, not
more than 10 percent of the outstanding
stock of the corporation or stock
possessing more than 10 percent of the
total combined voting power of all
stock of the corporation, or
(ii) in the case of a qualified small
business which is not a corporation,
not more than 10 percent of the capital
or profits interest of such business.
(E) Applicable non-family attribution
rules.--The term ``applicable non-family
attribution rules'' means the attribution rules
of subsection (c) or (e)(3) of section 267, as
the case may be, but in each case applied
without regard to section 267(c)(2).
(3) W-2 wages.--For purposes of this section--
(A) In general.--The term ``W-2 wages''
means, with respect to any person for any
taxable year of such person, the sum of the
amounts described in paragraphs (3) and (8) of
section 6051(a) paid by such person with
respect to employment of employees by such
person during the calendar year ending during
such taxable year.
(B) Limitation to wages attributable to
qualified domestic business income.--Such term
shall not include any amount which is not
properly allocable to domestic business gross
receipts for purposes of subsection (c)(1).
(C) Other requirements.--Except in the case
of amounts treated as W-2 wages under paragraph
(4)--
(i) such term shall not include any
amount which is not allowed as a
deduction under section 162 for the
taxable year, and
(ii) such term shall not include any
amount which is not properly included
in a return filed with the Social
Security Administration on or before
the 60th day after the due date
(including extensions) for such return.
(4) Certain partnership distributions treated as w-2
wages.--
(A) In general.--In the case of a qualified
small business which is a partnership and
elects the application of this paragraph for
the taxable year--
(i) the qualified domestic business
taxable income of such partnership for
such taxable year (determined after the
application of clause (ii)) which is
allocable under rules similar to the
rules of section 199(d)(1)(A)(ii) to
each qualified service-providing
partner shall be treated for purposes
of this section as W-2 wages paid
during such taxable year to such
partner as an employee, and
(ii) the domestic business gross
receipts of such partnership for such
taxable year shall be reduced by the
amount so treated.
(B) Qualified service-providing partner.--For
purposes of this paragraph, the term
``qualified service-providing partner'' means,
with respect to any qualified domestic business
taxable income, any partner who is a 10-
percent-or-less direct owner and who materially
participates in the trade or business to which
such income relates.
(5) Acquisitions and dispositions.--The Secretary
shall provide for the application of this subsection in
cases where the taxpayer acquires, or disposes of, the
major portion of a trade or business or the major
portion of a separate unit of a trade or business
during the taxable year.
(c) Qualified Domestic Business Income.--For purposes of this
section--
(1) In general.--The term ``qualified domestic
business income'' for any taxable year means an amount
equal to the excess (if any) of--
(A) the taxpayer's domestic business gross
receipts for such taxable year, over
(B) the sum of--
(i) the cost of goods sold that are
allocable to such receipts, and
(ii) other expenses, losses, or
deductions (other than the deduction
allowed under this section), which are
properly allocable to such receipts.
(2) Domestic business gross receipts.--
(A) In general.--The term ``domestic business
gross receipts'' means the gross receipts of
the taxpayer which are effectively connected
with the conduct of a trade or business within
the United States within the meaning of section
864(c) but determined--
(i) without regard to paragraphs (3),
(4), and (5) thereof, and
(ii) by substituting ``qualified
small business (within the meaning of
section 200)'' for ``nonresident alien
individual or a foreign corporation''
each place it appears therein.
(B) Exceptions.--For purposes of paragraph
(1), domestic business gross receipts shall not
include any of the following:
(i) Gross receipts derived from the
sale or exchange of--
(I) a capital asset, or
(II) property used in the
trade or business (as defined
in section 1231(b)).
(ii) Royalties, rents, dividends,
interest, or annuities.
(iii) Any amount which constitutes
wages (as defined in section 3401).
(3) Application of certain rules.--Rules similar to
the rules of paragraphs (2) and (3) of section 199(c)
shall apply for purposes of this section (applied with
respect to qualified domestic business income in lieu
of qualified production activities income and with
respect to domestic business gross receipts in lieu of
domestic production gross receipts).
(d) Qualified Small Business.--For purposes of this section--
(1) In general.--The term ``qualified small
business'' means any employer engaged in a trade or
business if such employer had fewer than 500 full-time
equivalent employees for either calendar year 2010 or
2011.
(2) Full-time equivalent employees.--The term ``full-
time equivalent employees'' has the meaning given such
term by subsection (d)(2) of section 45R applied--
(A) without regard to subsection (d)(5) of
such section,
(B) with regard to subsection (e)(1) of such
section, and
(C) by substituting ``calendar year'' for
``taxable year'' each place it appears therein.
(3) Employers not in existence prior to 2012.--In the
case of an employer which was not in existence on
January 1, 2012, the determination under paragraph (1)
shall be made with respect to calendar year 2012.
(4) Application to calendar years in which employer
in existence for portion of calendar year.--In the case
of any calendar year during which the employer comes
into existence, the number of full-time equivalent
employees determined under paragraph (2) with respect
to such calendar year shall be increased by multiplying
the number so determined (without regard to this
paragraph) by the quotient obtained by dividing--
(A) the number of days in such calendar year,
by
(B) the number of days during such calendar
year which such employer is in existence.
(5) Special rules.--
(A) Aggregation rule.--For purposes of
paragraph (1), any person treated as a single
employer under subsection (a) or (b) of section
52 (applied without regard to section 1563(b))
or subsection (m) or (o) of section 414 shall
be treated as a single employer for purposes of
this subsection.
(B) Predecessors.--Any reference in this
subsection to an employer shall include a
reference to any predecessor of such employer.
(e) Special Rules.--
(1) Elective application of deduction.--Except as
otherwise provided by the Secretary, the taxpayer may
elect not to take any item of income into account as
domestic business gross receipts for purposes of this
section.
(2) Coordination with section 199.--If a deduction is
allowed under this section with respect to any taxpayer
for any taxable year--
(A) any gross receipts of the taxpayer which
are taken into account under this section for
such taxable year shall not be taken into
account under section 199 for such taxable
year, and
(B) the W-2 wages of the taxpayer which are
taken into account under this section shall not
be taken into account under section 199 for
such taxable year.
(3) Application of certain rules.--Rules similar to
the rules of paragraphs (1), (2), (3), (4), (6), and
(7) of section 199(d) shall apply for purposes of this
section (applied with respect to qualified domestic
business income in lieu of qualified production
activities income).
(f) Regulations.--The Secretary shall prescribe such
regulations as are necessary to carry out the purposes of this
section, including regulations which prevent a taxpayer which
reorganizes from being treated as a qualified small business if
such taxpayer would not have been treated as a qualified small
business prior to such reorganization.
(g) Application.--Subsection (a) shall apply only with
respect to the first taxable year of the taxpayer beginning
after December 31, 2011.

PART VII--ADDITIONAL ITEMIZED DEDUCTIONS FOR INDIVIDUALS

* * * * * * *

SEC. 219. RETIREMENT SAVINGS.

(a) * * *

* * * * * * *

(g) Limitation on Deduction for Active Participants in
Certain Pension Plans.--
(1) * * *

* * * * * * *

(3) Adjusted gross income; applicable dollar
amount.--For purposes of this subsection--
(A) Adjusted gross income.--Adjusted gross
income of any taxpayer shall be determined--
(i) * * *
(ii) without regard to sections 135,
137, 199, 200, 221, 222, and 911 or the
deduction allowable under this section.

* * * * * * *

SEC. 221. INTEREST ON EDUCATION LOANS.

(a) * * *
(b) Maximum Deduction.--
(1) * * *
(2) Limitation based on modified adjusted gross
income.--
(A) * * *

* * * * * * *

(C) Modified adjusted gross income.--The term
``modified adjusted gross income'' means
adjusted gross income determined--
(i) without regard to this section
and sections 199, 200, 222, 911, 931,
and 933, and

* * * * * * *

SEC. 222. QUALIFIED TUITION AND RELATED EXPENSES.

(a) * * *
(b) Dollar Limitations.--
(1) * * *
(2) Applicable dollar limit.--
(A) * * *

* * * * * * *

(C) Adjusted gross income.--For purposes of
this paragraph, adjusted gross income shall be
determined--
(i) without regard to this section
and sections 199, 200, 911, 931, and
933, and

* * * * * * *

PART VIII--SPECIAL DEDUCTIONS FOR CORPORATIONS

* * * * * * *

SEC. 246. RULES APPLYING TO DEDUCTIONS FOR DIVIDENDS RECEIVED.

(a) * * *
(b) Limitation on Aggregate Amount of Deductions.--
(1) General rule.--Except as provided in paragraph
(2), the aggregate amount of the deductions allowed by
sections 243(a)(1), 244(a), and subsection (a) or (b)
of section 245 shall not exceed the percentage
determined under paragraph (3) of the taxable income
computed without regard to the deductions allowed by
sections 172, 199, 200, 243(a)(1), 244(a), subsection
(a) or (b) of section 245, and 247, without regard to
any adjustment under section 1059, and without regard
to any capital loss carryback to the taxable year under
section 1212(a)(1).

* * * * * * *

Subchapter E--Accounting Periods and Methods of Accounting

* * * * * * *

PART II--METHODS OF ACCOUNTING

* * * * * * *

Subpart C--Taxable Year for Which Deductions Taken

* * * * * * *

SEC. 469. PASSIVE ACTIVITY LOSSES AND CREDITS LIMITED.

(a) * * *

* * * * * * *

(i) $25,000 Offset for Rental Real Estate Activities.--
(1) * * *

* * * * * * *

(3) Phase-out of exemption.--
(A) * * *

* * * * * * *

(F) Adjusted gross income.--For purposes of
this paragraph, adjusted gross income shall be
determined without regard to--
(i) * * *

* * * * * * *

(iii) the amounts allowable as a
deduction under sections 199, 200, 219,
221, and 222, and

* * * * * * *

Subchapter I--Natural Resources

* * * * * * *

PART I--DEDUCTIONS

* * * * * * *

SEC. 613. PERCENTAGE DEPLETION.

(a) General Rule.--In the case of the mines, wells, and other
natural deposits listed in subsection (b), the allowance for
depletion under section 611 shall be the percentage, specified
in subsection (b), of the gross income from the property
excluding from such gross income an amount equal to any rents
or royalties paid or incurred by the taxpayer in respect of the
property. Such allowance shall not exceed 50 percent (100
percent in the case of oil and gas properties) of the
taxpayer's taxable income from the property (computed without
allowance for depletion and without the [deduction under
section 199] deductions under sections 199 and 200). For
purposes of the preceding sentence, the allowable deductions
taken into account with respect to expenses of mining in
computing the taxable income from the property shall be
decreased by an amount equal to so much of any gain which (1)
is treated under section 1245 (relating to gain from
disposition of certain depreciable property) as ordinary
income, and (2) is properly allocable to the property. In no
case shall the allowance for depletion under section 611 be
less than it would be if computed without reference to this
section.

* * * * * * *

SEC. 613A. LIMITATIONS ON PERCENTAGE DEPLETION IN CASE OF OIL AND GAS
WELLS.

(a) * * *

* * * * * * *

(d) Limitations on Application of Subsection (c).--
(1) Limitation based on taxable income.--The
deduction for the taxable year attributable to the
application of subsection (c) shall not exceed 65
percent of the taxpayer's taxable income for the year
computed without regard to--
(A) * * *

* * * * * * *

(C) any deduction allowable under section
200,
[(C)] (D) any net operating loss carryback to
the taxable year under section 172,
[(D)] (E) any capital loss carryback to the
taxable year under section 1212, and
[(E)] (F) in the case of a trust, any
distributions to its beneficiary, except in the
case of any trust where any beneficiary of such
trust is a member of the family (as defined in
section 267(c)(4)) of a settlor who created
inter vivos and testamentary trusts for members
of the family and such settlor died within the
last six days of the fifth month in 1970, and
the law in the jurisdiction in which such trust
was created requires all or a portion of the
gross or net proceeds of any royalty or other
interest in oil, gas, or other mineral
representing any percentage depletion allowance
to be allocated to the principal of the trust.
If an amount is disallowed as a deduction for the
taxable year by reason of application of the preceding
sentence, the disallowed amount shall be treated as an
amount allowable as a deduction under subsection (c)
for the following taxable year, subject to the
application of the preceding sentence to such taxable
year. For purposes of basis adjustments and determining
whether cost depletion exceeds percentage depletion
with respect to the production from a property, any
amount disallowed as a deduction on the application of
this paragraph shall be allocated to the respective
properties from which the oil or gas was produced in
proportion to the percentage depletion otherwise
allowable to such properties under subsection (c).

* * * * * * *

CHAPTER 2--TAX ON SELF-EMPLOYMENT INCOME

* * * * * * *

SEC. 1402. DEFINITIONS.

(a) Net Earnings from Self-Employment.--The term ``net
earnings from self-employment'' means the gross income derived
by an individual from any trade or business carried on by such
individual, less the deductions allowed by this subtitle which
are attributable to such trade or business, plus his
distributive share (whether or not distributed) of income or
loss described in section 702(a)(8) from any trade or business
carried on by a partnership of which he is a member; except
that in computing such gross income and deductions and such
distributive share of partnership ordinary income or loss--
(1) * * *

* * * * * * *

(16) the deduction provided by section 199 shall not
be allowed; [and]
(17) the deduction provided by section 200 shall not
be allowed; and
[(17)] (18) notwithstanding the preceding provisions
of this subsection, each spouse's share of income or
loss from a qualified joint venture shall be taken into
account as provided in section 761(f) in determining
net earnings from self-employment of such spouse.

* * * * * * *

DISSENTING VIEWS

The Small Business Tax Cut Act

We support policy initiatives to stimulate economic growth
and job creation and believe a private-public partnership
during this time of economic recovery is essential.
Unfortunately, H.R. 9, the so-called Small Business Tax Cut
Act, is a broad measure affecting 99.6 percent of all
businesses that is not targeted at job creation. The benefits
it provides will be meted out unevenly and in an arbitrary
manner, accruing in large measure to the wealthiest taxpayers.
While these facts alone argue for its rejection, this temporary
and expensive provision is also the very antithesis of tax
reform.
In their zeal to avoid picking ``winners and losers,'' the
majority has embraced a massive $46 billion tax cut that is
being offered in the name of small business but will go to 99.6
percent of all businesses, whatever the value of their assets
or the amount of their income and irrespective of the nature or
function of their business. The tax break is available to
partnerships of highly paid professionals, including lawyers
and lobbyists. It is available to hedge fund and private equity
fund managers. By restricting the definition of small business
to an employee count and ignoring other relevant factors, such
as revenues, H.R. 9 guarantees that the benefit will be
available to a host of businesses that are anything but small.
For example, many professional sports teams would get the tax
break.
H.R. 9 is not targeted at job creation. Any number of
measures could have been included in H.R. 9 to limit the
availability of the tax benefit to businesses that hire or
invest in the United States. None of these measures was
included. There is no requirement that a business receiving the
deduction created by H.R. 9 expand employment. In fact, a
business that reduces employment remains eligible for the
deduction. Even worse, businesses that reduce their American
workforce while expanding overseas still get the tax break. In
contrast to measures such as bonus depreciation or expensing,
there is no requirement that a business receiving the tax break
invest in the United States. And in contrast to measures such
as infrastructure spending, this one-time tax cut for the very
wealthiest would have a relatively small effect on cumulative
economic output.
The benefit provided by H.R. 9 is arbitrary. In the case of
small business owners, the same amount of small business income
will not always produce the same benefit. Because the benefit
is a deduction and not a credit, the value of the benefit
increases with income. In addition, because the size of the
benefit can be limited by a taxpayer's taxable income, losses
that reduce or eliminate such income, including losses carried
forward from prior years, can eliminate the benefit.
Preliminary analyses indicate that H.R. 9 is a $46 billion
tax cut disproportionately benefitting the very wealthiest
Americans. Although a distributional analysis by the Joint
Committee on Taxation is not yet available, the Center on
Budget and Policy Priorities indicated that, based on an
analysis provided by the Tax Policy Center, approximately ``49
percent of the tax cut [provided by H.R. 9] would go to the 0.3
percent of people with incomes exceeding $1 million in 2012;
they each would receive an average tax cut of more than
$44,000.'' Middle- and low-income families are struggling to
recover from the deepest recession in decades; they have lost
jobs, homes and retirement security. The Republican Majority
for months resisted extending the payroll tax cut benefitting
these families. But now, the Majority is rushing to put forward
another tax break for the very wealthiest Americans.
Given that this Committee has spent the last year and three
months talking about tax reform, perhaps the most striking
thing about H.R. 9 is that it is the antithesis of tax reform.
The House Republican budget assumes that this Committee will
produce a tax reform package with two rate brackets, but it
offers no clear indication of how to finance rate reductions
that would cost trillions of dollars. The only hint we have
gotten is the vague promise of the House Budget Committee
chairman to eliminate what he calls ``tax loopholes.'' But to
raise sufficient funds for his tax reform plans, his definition
of ``tax loophole'' would have to include provisions related to
health, education, home mortgage interest, and pensions. These
are not ``loopholes.'' Rather, in many cases, they are
provisions designed to achieve clear economic and social policy
goals. Ironically, H.R. 9 would be a new tax expenditure and a
temporary one at that. And it would have far less merit than
policies, such as the mortgage interest deduction and the
exclusion for employer-provided healthcare, that now appear to
be in the majority's crosshairs.
Finally, H.R. 9 is little more than a political device
designed to give the majority a talking point for the week of
April 15th. It is a distraction from the real businesses that
should be before the Committee, including the continuing
employment crisis and the need to address expiring provisions
such as the AMT patch and other tax provisions critical to
American businesses.

Sander M. Levin.
Charles B. Rangel.
Fortney Pete Stark.
Jim McDermott.
John Lewis.
John B. Larson.
Mike Thompson.
Earl Blumenauer.
Ron Kind.
Shelley Berkley.
Bill Pascrell, Jr.
Joseph Crowley.

All Congresses 93-117 (1973-2022)
117 (2021-2022)
116 (2019-2020)
115 (2017-2018)
114 (2015-2016)
113 (2013-2014)
112 (2011-2012)
111 (2009-2010)
110 (2007-2008)
109 (2005-2006)
108 (2003-2004)
107 (2001-2002)
106 (1999-2000)
105 (1997-1998)
104 (1995-1996)
103 (1993-1994)
102 (1991-1992)
101 (1989-1990)
100 (1987-1988)
99 (1985-1986)
98 (1983-1984)
97 (1981-1982)
96 (1979-1980)
95 (1977-1978)
94 (1975-1976)
93 (1973-1974)

Any Version of Legislation
AS - Amendment Ordered to be Printed
ASH - Additional Sponsors House
ATH - Agreed to House
ATS - Agreed to Senate
CDH - Committee Discharged House
CDS - Committee Discharged Senate
CPH - Considered and Passed House
CPS - Considered and Passed Senate
EAH - Engrossed Amendment House
EAS - Engrossed Amendment Senate
EH - Engrossed in House
ENR - Enrolled
ES - Engrossed in Senate
FPH - Failed Passage House
HDS - Held at Desk Senate
IH - Introduced in House
IPS - Indefinitely Postponed Senate
IS - Introduced in Senate
LTH - Laid on Table in House
LTS - Laid on Table in Senate
PAP - Printed as Passed
PCS - Placed on Calendar Senate
PP - Public Print
Private Law
Public Law
RCH - Reference Change House
RCS - Reference Change Senate
RDS - Received in Senate
RFH - Referred in House
RFS - Referred in Senate
RH - Reported in House
RIH - Referral Instructions House
RS - Reported to Senate
RTH - Referred to Committee House
RTS - Referred to Committee Senate
SC - Sponsor Change

All Congresses 97-117 (1981-2022)
117 (2021-2022)
116 (2019-2020)
115 (2017-2018)
114 (2015-2016)
113 (2013-2014)
112 (2011-2012)
111 (2009-2010)
110 (2007-2008)
109 (2005-2006)
108 (2003-2004)
107 (2001-2002)
106 (1999-2000)
105 (1997-1998)
104 (1995-1996)
103 (1993-1994)
102 (1991-1992)
101 (1989-1990)
100 (1987-1988)
99 (1985-1986)
98 (1983-1984)
97 (1981-1982)

Any State or Territory
Alabama
Alaska
American Samoa
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Guam
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Northern Mariana Islands
Ohio
Oklahoma
Oregon
Panama Canal Zone
Pennsylvania
Puerto Rico
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virgin Islands
Virginia
Washington
West Virginia
Wisconsin
Wyoming

Any State
Alabama
Alaska
American Samoa
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Guam
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Northern Mariana Islands
Northern Mariana Islands
Ohio
Oklahoma
Oregon
Panama Canal Zone
Panama Canal Zone
Pennsylvania
Puerto Rico
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virgin Islands
Virginia
Washington
West Virginia
Wisconsin
Wyoming

All Congresses 96-117 (1979-2022)
117 (2021-2022)
116 (2019-2020)
115 (2017-2018)
114 (2015-2016)
113 (2013-2014)
112 (2011-2012)
111 (2009-2010)
110 (2007-2008)
109 (2005-2006)
108 (2003-2004)
107 (2001-2002)
106 (1999-2000)
105 (1997-1998)
104 (1995-1996)
103 (1993-1994)
102 (1991-1992)
101 (1989-1990)
100 (1987-1988)
99 (1985-1986)
98 (1983-1984)
97 (1981-1982)
96 (1979-1980)

All Congresses 81-117 (1949-2022)
117 (2021-2022)
116 (2019-2020)
115 (2017-2018)
114 (2015-2016)
113 (2013-2014)
112 (2011-2012)
111 (2009-2010)
110 (2007-2008)
109 (2005-2006)
108 (2003-2004)
107 (2001-2002)
106 (1999-2000)
105 (1997-1998)
104 (1995-1996)
103 (1993-1994)
102 (1991-1992)
101 (1989-1990)
100 (1987-1988)
99 (1985-1986)
98 (1983-1984)
97 (1981-1982)
96 (1979-1980)
95 (1977-1978)
94 (1975-1976)
93 (1973-1974)
92 (1971-1972)
91 (1969-1970)
90 (1967-1968)
89 (1965-1966)
88 (1963-1964)
87 (1961-1962)
86 (1959-1960)
85 (1957-1958)
84 (1955-1956)
83 (1953-1954)
82 (1951-1952)
81 (1949-1950)

Any Topic
Agriculture
Arms Control
Aviation
Commercial
Consular
Dispute Settlement and Arbitration
Drugs/Illegal Substances
Environment
Extradition
Extradition and Criminal Assistance
Fisheries and Wildlife
Human Rights
Intellectual Property/Copyrights
International Law
International Law and Organization
Investment
Labor
Maritime Boundaries and Claims
Mutual Legal Assistance
Shipping and Marine Pollution
Taxation
Telecommunications
Terrorism
Trademarks/Patents
United Nations