A bill to amend the Internal Revenue Code of 1986 to extend for 1 year the allowance for bonus depreciation and the increased expensing limitations for depreciable business assets.

Summary: Bonus Depreciation and Small Business Expense Extension Act - Amends the Internal Revenue Code to extend for one year: (1) bonus depreciation; (2) the 100% expensing allowance for depreciable business assets; (3) the election to accelerate the alternative minimum tax (AMT) credit in lieu of bonus depreciation; and (4) the increased expensing allowance for tangible real and personal property, including computer software and leasehold, restaurant, and retail improvement property.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Bonus Depreciation and Small 
Business Expense Extension Act''.

SEC. 2. EXTENSION OF BONUS DEPRECIATION; TEMPORARY 100 PERCENT 
              EXPENSING FOR CERTAIN BUSINESS ASSETS.

    (a) In General.--Paragraph (2) of section 168(k) of the Internal 
Revenue Code of 1986 is amended--
            (1) by striking ``January 1, 2014'' in subparagraph (A)(iv) 
        and inserting ``January 1, 2015'', and
            (2) by striking ``January 1, 2013'' each place it appears 
        and inserting ``January 1, 2014''.
    (b) Temporary 100 Percent Expensing.--Paragraph (5) of section 
168(k) of the Internal Revenue Code of 1986 is amended--
            (1) by striking ``2013'' and inserting ``2014'', and
            (2) by striking ``2012'' each place it appears in the text 
        and heading and inserting ``2013''.
    (c) Extension of Election To Accelerate the AMT Credit in Lieu of 
Bonus Depreciation.--
            (1) In general.--Subclause (II) of section 
        168(k)(4)(D)(iii) of the Internal Revenue Code of 1986 is 
        amended by striking ``2013'' and inserting ``2014''.
            (2) Round 3 extension property.--Paragraph (4) of section 
        168(k) of such Code is amended by adding at the end the 
        following new subparagraph:
                    ``(J) Special rules for round 3 extension 
                property.--
                            ``(i) In general.--In the case of round 3 
                        extension property, this paragraph shall be 
                        applied without regard to--
                                    ``(I) the limitation described in 
                                subparagraph (B)(i) thereof, and
                                    ``(II) the business credit increase 
                                amount under subparagraph (E)(iii) 
                                thereof.
                            ``(ii) Taxpayers previously electing 
                        acceleration.--In the case of a taxpayer who 
                        made the election under subparagraph (A) for 
                        its first taxable year ending after March 31, 
                        2008, a taxpayer who made the election under 
                        subparagraph (H)(ii) for its first taxable year 
                        ending after December 31, 2008, or a taxpayer 
                        who made the election under subparagraph 
                        (I)(iii) for its first taxable year ending 
                        after December 31, 2010--
                                    ``(I) the taxpayer may elect not to 
                                have this paragraph apply to round 3 
                                extension property, but
                                    ``(II) if the taxpayer does not 
                                make the election under subclause (I), 
                                in applying this paragraph to the 
                                taxpayer the bonus depreciation amount, 
                                maximum amount, and maximum increase 
                                amount shall be computed and applied to 
                                eligible qualified property which is 
                                round 3 extension property.
                        The amounts described in subclause (II) shall 
                        be computed separately from any amounts 
                        computed with respect to eligible qualified 
                        property which is not round 2 extension 
                        property.
                            ``(iii) Taxpayers not previously electing 
                        acceleration.--In the case of a taxpayer who 
                        neither made the election under subparagraph 
                        (A) for its first taxable year ending after 
                        March 31, 2008, nor made the election under 
                        subparagraph (H)(ii) for its first taxable year 
                        ending after December 31, 2008, nor made the 
                        election under subparagraph (I)(iii) for its 
                        first taxable year ending after December 31, 
                        2010--
                                    ``(I) the taxpayer may elect to 
                                have this paragraph apply to its first 
                                taxable year ending after December 31, 
                                2011, and each subsequent taxable year, 
                                and
                                    ``(II) if the taxpayer makes the 
                                election under subclause (I), this 
                                paragraph shall only apply to eligible 
                                qualified property which is round 3 
                                extension property.
                            ``(iv) Round 3 extension property.--For 
                        purposes of this subparagraph, the term `round 
                        3 extension property' means property which is 
                        eligible qualified property solely by reason of 
                        the extension of the application of the special 
                        allowance under paragraph (1) pursuant to the 
                        amendments made by section 2(a) of the Bonus 
                        Depreciation and Small Business Expense 
                        Extension Act (and the application of such 
                        extension to this paragraph pursuant to the 
                        amendment made by section 2(c)(1) of such 
                        Act).''.
    (d) Conforming Amendments.--
            (1) The heading for subsection (k) of section 168 of the 
        Internal Revenue Code of 1986 is amended by striking ``January 
        1, 2013'' and inserting ``January 1, 2014''.
            (2) The heading for clause (ii) of section 168(k)(2)(B) of 
        such Code is amended by striking ``pre-january 1, 2013'' and 
        inserting ``pre-january 1, 2014''.
            (3) Paragraph (5) of section 168(l) of such Code is 
        amended--
                    (A) by striking ``and'' at the end of subparagraph 
                (A),
                    (B) by redesignating subparagraph (C) as 
                subparagraph (B), and
                    (C) by inserting after subparagraph (A) the 
                following new subparagraph:
                    ``(B) by substituting `January 1, 2013' for 
                `January 1, 2014' in clause (i) thereof, and''.
            (4) Subparagraph (C) of section 168(n)(2) of such Code is 
        amended by striking ``January 1, 2013'' and inserting ``January 
        1, 2014''.
            (5) Subparagraph (D) of section 1400L(b)(2) of such Code is 
        amended by striking ``January 1, 2013'' and inserting ``January 
        1, 2014''.
            (6) Subparagraph (B) of section 1400N(d)(3) of such Code is 
        amended by striking ``January 1, 2013'' and inserting ``January 
        1, 2014''.
    (e) Effective Date.--The amendments made by this section shall 
apply to property placed in service after December 31, 2011, in taxable 
years ending after such date.

SEC. 3. EXTENSION OF INCREASED EXPENSING LIMITATIONS FOR CERTAIN 
              DEPRECIABLE BUSINESS ASSETS AND TREATMENT OF CERTAIN REAL 
              PROPERTY AS SECTION 179 PROPERTY.

    (a) In General.--Section 179(b) of the Internal Revenue Code of 
1986 is amended--
            (1) by striking ``2010 or 2011'' each place it appears in 
        paragraph (1)(B) and (2)(B) and inserting ``2010, 2011, or 
        2012'',
            (2) by striking ``2012'' each place it appears in paragraph 
        (1)(C) and (2)(C) and inserting ``2013'', and
            (3) by striking ``2012'' each place it appears in paragraph 
        (1)(D) and (2)(D) and inserting ``2013''.
    (b) Inflation Adjustment.--Subparagraph (A) of section 179(b)(6) of 
the Internal Revenue Code of 1986 is amended by striking ``2012'' and 
inserting ``2013''.
    (c) Computer Software.--Section 179(d)(1)(A)(ii) of the Internal 
Revenue Code of 1986 is amended by striking ``2013'' and inserting 
``2014''.
    (d) Election.--Section 179(c)(2) of the Internal Revenue Code of 
1986 is amended by striking ``2013'' and inserting ``2014''.
    (e) Special Rules for Treatment of Qualified Real Property.--
Section 179(f)(1) of the Internal Revenue Code of 1986 is amended by 
striking ``2010 or 2011'' and inserting ``2010, 2011, or 2012''.
    (f) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2011.