ABC Act of 2023

I 118TH CONGRESS 1ST SESSION H. R. 3060 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 MAY 2, 2023 Mr. KIM of New Jersey (for himself and Mr. BURCHETT) 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 2023’’ or as the ‘‘ABC Act of 2023’’. 5 SEC. 2. EXCLUSION OF INTEREST ON CERTAIN SMALL BUSI- 6 NESS LOANS. 7 (a) IN GENERAL.—Part III of subchapter B of chap- 8 ter 1 of the Internal Revenue Code of 1986 is amended 9 by inserting after section 139I the following new section: 10 VerDate Sep 11 2014 00:46 May 13, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3060.IH H3060 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 3060 IH ‘‘SEC. 139J. INTEREST ON CERTAIN SMALL BUSINESS 1 LOANS. 2 ‘‘(a) IN GENERAL.—In the case of a bank described 3 in subsection (c), gross income shall not include qualified 4 interest received from a small business during the taxable 5 year. 6 ‘‘(b) QUALIFIED INTEREST.—The term ‘qualified in- 7 terest’ means, with respect to a small business, interest 8 on indebtedness of not more than $5,000,000— 9 ‘‘(1) secured by land situated in the United 10 States that is used or held by the small business in 11 connection with the active conduct of a farming 12 business, or 13 ‘‘(2) incurred in the ordinary course of the 14 trade or business of the small business. 15 ‘‘(c) BANK DESCRIBED.— 16 ‘‘(1) IN GENERAL.—A bank is described in this 17 subsection if the bank has less than 18 $50,000,000,000 in assets at the close of the pre- 19 ceding taxable year. 20 ‘‘(2) BANK DEFINED.—For purposes of this 21 subsection— 22 ‘‘(A) IN GENERAL.—The term ‘bank’ 23 means— 24 ‘‘(i) any financial institution described 25 in section 581 or 591, and 26 VerDate Sep 11 2014 00:46 May 13, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3060.IH H3060 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 3060 IH ‘‘(ii) a corporation which, under the 1 laws of the State of its incorporation, is 2 subject to supervision and examination by 3 the Commissioner of Banking or other offi- 4 cer of such State in charge of the adminis- 5 tration of the banking laws of such State. 6 ‘‘(B) HOLDING COMPANY.—The term 7 ‘bank’ includes— 8 ‘‘(i) any bank holding company (with- 9 in the meaning of section 2(a) of the Bank 10 Holding Company Act of 1956), and 11 ‘‘(ii) any subsidiary of a financial in- 12 stitution described in section 581 or 591 or 13 of any bank holding company if such sub- 14 sidiary is predominantly engaged (directly 15 or indirectly) in the active conduct of a 16 banking, financing, or similar business. 17 ‘‘(d) SMALL BUSINESS.—The term ‘small business’ 18 means a small business concern as defined under section 19 3 of the Small Business Act (15 U.S.C. 632). 20 ‘‘(e) FARMING BUSINESS.—The term ‘farming busi- 21 ness’ has the meaning given such term by section 22 263A(e)(4). 23 ‘‘(f) TERMINATION.—This section shall not apply to 24 interest received after December 31, 2027.’’. 25 VerDate Sep 11 2014 00:46 May 13, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3060.IH H3060 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 3060 IH (b) CLERICAL AMENDMENT.—The table of sections 1 for part III of subchapter B of chapter 1 of such Code 2 is amended by inserting after the item relating to section 3 139I the following new item: 4 ‘‘Sec. 139J. Interest on certain small business loans.’’. (c) REPORT TO CONGRESS.—Not later than Decem- 5 ber 31, 2025, the Commissioner of Internal Revenue, after 6 consultation with the Federal reserve banks, shall submit 7 to Congress a written report providing the recommenda- 8 tion of the Commissioner regarding whether the exclusion 9 provided under section 139J of the Internal Revenue Code 10 of 1986 (as added by this section) should be extended or 11 should be allowed to terminate and the reasons for such 12 recommendation. 13 (d) EFFECTIVE DATE.—The amendments made by 14 this section shall apply to interest received after December 15 31, 2022, in taxable years ending after such date. 16 Æ VerDate Sep 11 2014 00:46 May 13, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6301 E:\BILLS\H3060.IH H3060 kjohnson on DSK79L0C42PROD with BILLS