Veterans Jobs Opportunity Act

II 116TH CONGRESS 1ST SESSION S. 2100 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 SENATE OF THE UNITED STATES JULY 11, 2019 Ms. ROSEN (for herself, Mr. MORAN, Mr. CRAMER, and Mr. JONES) intro- duced the following bill; which was read twice and referred to the Com- mittee on Finance 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 03:13 Jul 17, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S2100.IS S2100 kjohnson on DSK79L0C42 with BILLS 2 •S 2100 IS 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 $50,000. 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 03:13 Jul 17, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S2100.IS S2100 kjohnson on DSK79L0C42 with BILLS 3 •S 2100 IS ‘‘(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 which is a small business concern (as defined 11 under section 3 of the Small Business Act (15 12 U.S.C. 632)). 13 ‘‘(4) UNDERSERVED COMMUNITY.—The term 14 ‘underserved community’ means any area located 15 within— 16 ‘‘(A) a HUBZone (as defined in section 17 3(p) of the Small Business Act (15 U.S.C. 18 632(p))), 19 ‘‘(B) an empowerment zone, or enterprise 20 community, designated under section 1391 (and 21 without regard to whether or not such designa- 22 tion remains in effect), 23 VerDate Sep 11 2014 03:13 Jul 17, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S2100.IS S2100 kjohnson on DSK79L0C42 with BILLS 4 •S 2100 IS ‘‘(C) an area of low income or moderate in- 1 come (as recognized by the Federal Financial 2 Institutions Examination Council), or 3 ‘‘(D) a county with persistent poverty (as 4 classified by the Economic Research Service of 5 the Department of Agriculture). 6 ‘‘(5) VETERAN OR SPOUSE OF VETERAN.—The 7 term ‘veteran or spouse of a veteran’ has the mean- 8 ing given such term by section 7(a)(31)(G)(iii) of 9 the Small Business Act (15 U.S.C. 10 636(a)(31)(G)(iii)). 11 ‘‘(c) QUALIFIED START-UP EXPENDITURES.—For 12 purposes of this section— 13 ‘‘(1) IN GENERAL.—The term ‘qualified start- 14 up expenditures’ means— 15 ‘‘(A) any start-up expenditures (as defined 16 in section 195(c)), or 17 ‘‘(B) any amounts paid or incurred during 18 the taxable year for the purchase or lease of 19 real property, or the purchase of personal prop- 20 erty, placed in service during the taxable year 21 and used in the active conduct of a trade or 22 business. 23 ‘‘(d) SPECIAL RULES.—For purposes of this sec- 24 tion— 25 VerDate Sep 11 2014 03:13 Jul 17, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2100.IS S2100 kjohnson on DSK79L0C42 with BILLS 5 •S 2100 IS ‘‘(1) YEAR OF ELECTION.—The taxpayer may 1 elect the application of this section only for the first 2 2 taxable years for which ordinary and necessary ex- 3 penses paid or incurred in carrying on such trade or 4 business are allowable as a deduction by the tax- 5 payer under section 162. 6 ‘‘(2) CONTROLLED GROUPS AND COMMON CON- 7 TROL.—All persons treated as a single employer 8 under subsections (a) and (b) of section 52 shall be 9 treated as 1 person. 10 ‘‘(3) NO DOUBLE BENEFIT.—If a credit is de- 11 termined under this section with respect to any 12 property, the basis of such property shall be reduced 13 by the amount of the credit attributable to such 14 property.’’. 15 (b) CLERICAL AMENDMENT.—The table of sections 16 for subpart D of part IV of subchapter A of chapter 1 17 of such Code is amended by adding at the end the fol- 18 lowing new item: 19 ‘‘Sec. 45T. Veteran small business start-up credit.’’. (c) MADE PART OF GENERAL BUSINESS CREDIT.— 20 Section 38(b) of such Code is amended by striking ‘‘plus’’ 21 at the end of paragraph (31), by striking the period at 22 the end of paragraph (32) and inserting ‘‘, plus’’, and by 23 adding at the end the following new paragraph: 24 VerDate Sep 11 2014 03:13 Jul 17, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2100.IS S2100 kjohnson on DSK79L0C42 with BILLS 6 •S 2100 IS ‘‘(33) the veteran small business start-up credit 1 determined under section 45T.’’. 2 (d) REPORT BY TREASURY INSPECTOR GENERAL 3 FOR TAX ADMINISTRATION.—Every fourth year after the 4 date of the enactment of this Act, the Treasury Inspector 5 General for Tax Administration shall include in one of the 6 semiannual reports under section 5 of the Inspector Gen- 7 eral Act of 1978 with respect to such year, an evaluation 8 of the program under section 45T of the Internal Revenue 9 Code of 1986 (as added by this section), including an eval- 10 uation of the success of, and accountability with respect 11 to, such program. 12 (e) EFFECTIVE DATE.—The amendments made by 13 this section shall apply to taxable years beginning after 14 the date of the enactment of this Act. 15 Æ VerDate Sep 11 2014 03:13 Jul 17, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6301 E:\BILLS\S2100.IS S2100 kjohnson on DSK79L0C42 with BILLS