ABC Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 4805 To amend the Internal Revenue Code of 1986 to provide an exclusion from gross income for interest on certain small business loans. IN THE HOUSE OF REPRESENTATIVES OCTOBER 23, 2019 Mr. KIM (for himself, Mr. BURCHETT, and Ms. KENDRA S. HORN of Okla- homa) 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 provide an exclusion from gross income for interest on certain small business loans. 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 ‘‘Access Business Credit 4 Act of 2019’’ or as the ‘‘ABC Act of 2019’’. 5 VerDate Sep 11 2014 23:44 Oct 28, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H4805.IH H4805 kjohnson on DSK79L0C42 with BILLS 2 •HR 4805 IH SEC. 2. EXCLUSION OF INTEREST ON CERTAIN SMALL BUSI- 1 NESS LOANS. 2 (a) IN GENERAL.—Part III of subchapter B of chap- 3 ter 1 of the Internal Revenue Code of 1986 is amended 4 by inserting after section 139G the following new section: 5 ‘‘SEC. 139H. INTEREST ON CERTAIN SMALL BUSINESS 6 LOANS. 7 ‘‘(a) IN GENERAL.—In the case of a bank described 8 in subsection (c), gross income shall not include qualified 9 interest received from a small business during the taxable 10 year. 11 ‘‘(b) QUALIFIED INTEREST.—The term ‘qualified in- 12 terest’ means, with respect to a small business, interest 13 on indebtedness of not more than $5,000,000— 14 ‘‘(1) secured by land situated in the United 15 States that is used or held by the small business in 16 connection with the active conduct of a farming 17 business, or 18 ‘‘(2) incurred in the ordinary course of the 19 trade or business of the small business. 20 ‘‘(c) BANK DESCRIBED.— 21 ‘‘(1) IN GENERAL.—A bank is described in this 22 subsection if the bank has less than $50 billion in 23 assets at the close of the preceding taxable year. 24 ‘‘(2) BANK DEFINED.—For purposes of this 25 subsection— 26 VerDate Sep 11 2014 23:44 Oct 28, 2019 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H4805.IH H4805 kjohnson on DSK79L0C42 with BILLS 3 •HR 4805 IH ‘‘(A) IN GENERAL.—The term ‘bank’ 1 means— 2 ‘‘(i) any financial institution described 3 in section 581 or 591, and 4 ‘‘(ii) a corporation which, under the 5 laws of the State of its incorporation, is 6 subject to supervision and examination by 7 the Commissioner of Banking or other offi- 8 cer of such State in charge of the adminis- 9 tration of the banking laws of such State. 10 ‘‘(B) HOLDING COMPANY.—The term 11 ‘bank’ includes— 12 ‘‘(i) any bank holding company (with- 13 in the meaning of section 2(a) of the Bank 14 Holding Company Act of 1956), and 15 ‘‘(ii) any subsidiary of a financial in- 16 stitution described in section 581 or 591 or 17 of any bank holding company if such sub- 18 sidiary is predominantly engaged (directly 19 or indirectly) in the active conduct of a 20 banking, financing, or similar business. 21 ‘‘(d) SMALL BUSINESS.—The term ‘small business’ 22 means a small business concern as defined under section 23 3 of the Small Business Act (15 U.S.C. 632). 24 VerDate Sep 11 2014 23:44 Oct 28, 2019 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H4805.IH H4805 kjohnson on DSK79L0C42 with BILLS 4 •HR 4805 IH ‘‘(e) FARMING BUSINESS.—The term ‘farming busi- 1 ness’ has the meaning given such term by section 2 263A(e)(4). 3 ‘‘(f) TERMINATION.—This section shall not apply to 4 interest received after December 31, 2025.’’. 5 (b) CLERICAL AMENDMENT.—The table of sections 6 for part III of subchapter B of chapter 1 of such Code 7 is amended by inserting after the item relating to section 8 139G the following new item: 9 ‘‘Sec. 139H. Interest on certain small business loans.’’. (c) REPORT TO CONGRESS.—Not later than Decem- 10 ber 31, 2024, the Commissioner of Internal Revenue, after 11 consultation with the Federal reserve banks, shall submit 12 to Congress a written report providing the recommenda- 13 tion of the Commissioner regarding whether the exclusion 14 provided under section 139H of the Internal Revenue 15 Code of 1986 (as added by this section) should be ex- 16 tended or should be allowed to terminate and the reasons 17 for such recommendation. 18 (d) EFFECTIVE DATE.—The amendments made by 19 this section shall apply to interest received after December 20 31, 2020, in taxable years ending after such date. 21 Æ VerDate Sep 11 2014 23:44 Oct 28, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\H4805.IH H4805 kjohnson on DSK79L0C42 with BILLS