Veterans Jobs Opportunity Act

I 116TH CONGRESS 1ST SESSION H. R. 186 To amend the Internal Revenue Code of 1986 to establish a small business start-up tax credit for veterans creating businesses in underserved com- munities. IN THE HOUSE OF REPRESENTATIVES JANUARY 3, 2019 Mr. LAWSON of Florida introduced the following bill; which was referred to the Committee on Ways and Means A BILL To amend the Internal Revenue Code of 1986 to establish a small business start-up tax credit for veterans creating businesses in underserved communities. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Veterans Jobs Oppor- 4 tunity Act’’. 5 SEC. 2. VETERAN SMALL BUSINESS START-UP CREDIT. 6 (a) IN GENERAL.—Subpart D of part IV of sub- 7 chapter A of chapter 1 of the Internal Revenue Code of 8 VerDate Sep 11 2014 20:49 Jan 15, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H186.IH H186 pamtmann on DSKBFK8HB2PROD with BILLS 2 •HR 186 IH 1986 is amended by adding at the end the following new 1 section: 2 ‘‘SEC. 45T. VETERAN SMALL BUSINESS START-UP CREDIT. 3 ‘‘(a) IN GENERAL.—For purposes of section 38, in 4 the case of an applicable veteran-owned business which 5 elects the application of this section, the veteran small 6 business start-up credit determined under this section for 7 any taxable year is an amount equal to 15 percent of so 8 much of the qualified start-up expenditures of the tax- 9 payer as does not exceed $80,000. 10 ‘‘(b) APPLICABLE VETERAN-OWNED SMALL BUSI- 11 NESS.—For purposes of this section— 12 ‘‘(1) IN GENERAL.—The term ‘applicable vet- 13 eran-owned small business’ means a small business 14 owned and controlled by one or more veterans or 15 spouses of veterans and the principal place of busi- 16 ness of which is in an underserved community. 17 ‘‘(2) OWNERSHIP AND CONTROL.—The term 18 ‘owned and controlled’ means— 19 ‘‘(A) management and operation of the 20 daily business, and— 21 ‘‘(B)(i) in the case of a sole proprietorship, 22 sole ownership, 23 VerDate Sep 11 2014 20:49 Jan 15, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H186.IH H186 pamtmann on DSKBFK8HB2PROD with BILLS 3 •HR 186 IH ‘‘(ii) in the case of a corporation, owner- 1 ship (by vote or value) of not less than 51 per- 2 cent of the stock in such corporation, or 3 ‘‘(iii) in the case of a partnership or joint 4 venture, ownership of not less than 51 percent 5 of the profits interests or capital interests in 6 such partnership or joint venture. 7 ‘‘(3) SMALL BUSINESS.—The term ‘small busi- 8 ness’ means, with respect to any taxable year, any 9 person engaged in a trade or business in the United 10 States if— 11 ‘‘(A) the gross receipts of such person for 12 the preceding taxable year did not exceed 13 $5,000,000, or 14 ‘‘(B) in the case of a person to which sub- 15 paragraph (A) does not apply, such person em- 16 ployed not more than 100 full-time employees 17 during the preceding taxable year. 18 For purposes of subparagraph (B), an employee 19 shall be considered full-time if such employee is em- 20 ployed at least 30 hours per week for 20 or more 21 calendar weeks in the taxable year. 22 ‘‘(4) UNDERSERVED COMMUNITY.—The term 23 ‘underserved community’ means any area located 24 within— 25 VerDate Sep 11 2014 20:49 Jan 15, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H186.IH H186 pamtmann on DSKBFK8HB2PROD with BILLS 4 •HR 186 IH ‘‘(A) a HUBZone (as defined in section 1 3(p) of the Small Business Act (15 U.S.C. 2 632(p))), 3 ‘‘(B) an empowerment zone, or enterprise 4 community, designated under section 1391 (and 5 without regard to whether or not such designa- 6 tion remains in effect), 7 ‘‘(C) an area of low income or moderate in- 8 come (as recognized by the Federal Financial 9 Institutions Examination Council), or 10 ‘‘(D) a county with persistent poverty (as 11 classified by the Economic Research Service of 12 the Department of Agriculture). 13 ‘‘(5) VETERAN OR SPOUSE OF VETERAN.—The 14 term ‘veteran or spouse of a veteran’ has the mean- 15 ing given such term by section 7(a)(31)(G)(iii) of 16 the Small Business Act (15 U.S.C. 17 636(a)(31)(G)(iii)). 18 ‘‘(c) QUALIFIED START-UP EXPENDITURES.—For 19 purposes of this section— 20 ‘‘(1) IN GENERAL.—The term ‘qualified start- 21 up expenditures’ means— 22 ‘‘(A) any start-up expenditures (as defined 23 in section 195(c)), or 24 VerDate Sep 11 2014 20:49 Jan 15, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H186.IH H186 pamtmann on DSKBFK8HB2PROD with BILLS 5 •HR 186 IH ‘‘(B) any amounts paid or incurred during 1 the taxable year for the purchase or lease of 2 real property, or the purchase of personal prop- 3 erty, placed in service during the taxable year 4 and used in the active conduct of a trade or 5 business. 6 ‘‘(d) SPECIAL RULES.—For purposes of this sec- 7 tion— 8 ‘‘(1) YEAR OF ELECTION.—The taxpayer may 9 elect the application of this section only for the first 10 2 taxable years for which ordinary and necessary ex- 11 penses paid or incurred in carrying on such trade or 12 business are allowable as a deduction by the tax- 13 payer under section 162. 14 ‘‘(2) CONTROLLED GROUPS AND COMMON CON- 15 TROL.—All persons treated as a single employer 16 under subsections (a) and (b) of section 52 shall be 17 treated as 1 person. 18 ‘‘(3) NO DOUBLE BENEFIT.—If a credit is de- 19 termined under this section with respect to any 20 property, the basis of such property shall be reduced 21 by the amount of the credit attributable to such 22 property.’’. 23 (b) CLERICAL AMENDMENT.—The table of sections 24 for subpart D of part IV of subchapter A of chapter 1 25 VerDate Sep 11 2014 20:49 Jan 15, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H186.IH H186 pamtmann on DSKBFK8HB2PROD with BILLS 6 •HR 186 IH of such Code is amended by adding at the end the fol- 1 lowing new item: 2 ‘‘Sec. 45T. Veteran small business start-up credit.’’. (c) MADE PART OF GENERAL BUSINESS CREDIT.— 3 Section 38(b) of such Code is amended by striking ‘‘plus’’ 4 at the end of paragraph (31), by striking the period at 5 the end of paragraph (32) and inserting ‘‘, plus’’, and by 6 adding at the end the following new paragraph: 7 ‘‘(33) the veteran small business start-up credit 8 determined under section 45T.’’. 9 (d) REPORT BY TREASURY INSPECTOR GENERAL 10 FOR TAX ADMINISTRATION.—Every fourth year after the 11 date of the enactment of this Act, the Treasury Inspector 12 General for Tax Administration shall include in one of the 13 semiannual reports under section 5 of the Inspector Gen- 14 eral Act of 1978 with respect to such year, an evaluation 15 of the program under section 45T of the Internal Revenue 16 Code of 1986 (as added by this section), including an eval- 17 uation of the success of, and accountability with respect 18 to, such program. 19 (e) EFFECTIVE DATE.—The amendments made by 20 this section shall apply to taxable years beginning after 21 the date of the enactment of this Act. 22 Æ VerDate Sep 11 2014 20:49 Jan 15, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6301 E:\BILLS\H186.IH H186 pamtmann on DSKBFK8HB2PROD with BILLS