Temporary Investment Tax Credit Restoration Act of 1993

Summary: Temporary Investment Tax Credit Restoration Act of 1993 - Amends the Internal Revenue Code to allow an investment tax credit for manufacturing and other productive equipment for the period after December 31, 1987, and before January 1, 1993.  Provides for determining such credit.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Temporary Investment Tax Credit 
Restoration Act of 1993''.

SEC. 2. INVESTMENT CREDIT FOR MANUFACTURING AND OTHER PRODUCTIVE 
              EQUIPMENT.

    (a) Allowance of Credit.--Section 46 of the Internal Revenue Code 
of 1986 (relating to amount of investment credit) is amended by 
striking ``and'' at the end of paragraph (2), by striking the period at 
the end of paragraph (3) and inserting ``, and'', and by adding at the 
end thereof the following new paragraph:
            ``(4) the manufacturing and other productive equipment 
        credit.''
    (b) Amount of Credit.--Section 48 of such Code is amended by adding 
at the end thereof the following new subsection:
    ``(c) Manufacturing and Other Productive Equipment Credit.--
            ``(1) In general.--For purposes of section 46, the 
        manufacturing and other productive equipment credit for any 
        taxable year is an amount equal to 10 percent of the excess (if 
        any) of--
                    ``(A) the aggregate bases of qualified 
                manufacturing and productive equipment properties 
                placed in service during such taxable year, over
                    ``(B) the base amount.
            ``(2) Qualified manufacturing and productive equipment 
        property.--For purposes of this subsection--
                    ``(A) In general.--The term `qualified 
                manufacturing and productive equipment property' means 
                any property--
                            ``(i) which is used--
                                    ``(I) as an integral part of the 
                                manufacture or production of tangible 
                                personal property, or
                                    ``(II) in farming,
                            ``(ii) which is tangible property to which 
                        section 168 applies, and
                            ``(iii) which is section 1245 property (as 
                        defined in section 1245(a)(3)).
                    ``(B) Special rule for computer software.--In the 
                case of any computer software which is used to control 
                or monitor a manufacturing or production process and 
                with respect to which depreciation (or amortization in 
                lieu of depreciation) is allowable, such software shall 
                be treated as qualified manufacturing and productive 
                equipment property.
            ``(3) Base amount.--For purposes of paragraph (1)(B)--
                    ``(A) In general.--The term `base amount' means the 
                product of--
                            ``(i) the fixed-base percentage, and
                            ``(ii) the average annual gross receipts of 
                        the taxpayer for the 4 taxable years preceding 
                        the taxable year for which the credit is being 
                        determined (hereafter in this subsection 
                        referred to as the `credit year').
                    ``(B) Minimum base amount.--In no event shall the 
                base amount be less than 50 percent of the amount 
                determined under paragraph (1)(A).
                    ``(C) Fixed-base percentage.--
                            ``(i) In general.--The fixed-base 
                        percentage is the percentage which the 
                        aggregate amounts described in paragraph (1)(A) 
                        for taxable years beginning after December 31, 
                        1987, and before January 1, 1993, is of the 
                        aggregate gross receipts of the taxpayer for 
                        such taxable years.
                            ``(ii) Rounding.--The percentages 
                        determined under clause (i) shall be rounded to 
                        the nearest \1/100\ of 1 percent.
                    ``(D) Other rules.--Rules similar to the rules of 
                paragraphs (4) and (5) of section 41(c) shall apply for 
                purposes of this paragraph.
            ``(4) Allocation of basis adjustment.--The reduction 
        required by section 50(c) for any taxable year shall be 
        allocated among the qualified manufacturing and productive 
        equipment property placed in service by the taxpayer during 
        such year in proportion to the respective bases of such 
        property.
            ``(5) Recapture.--In applying section 50(a) to any property 
        which ceases to be qualified manufacturing and productive 
        equipment property, the credit determined under this subsection 
        with respect to such property shall be treated as being equal 
        to 10 percent of the lesser of--
                    ``(A) the excess referred to in paragraph (1) for 
                the taxable year in which such property was placed in 
                service, or
                    ``(B) the basis of such property which was taken 
                into account under paragraph (1).
            ``(6) Controlled groups.--Rules similar to the rules of 
        paragraph (1) of section 41(f) shall apply for purposes of this 
        subsection.
            ``(7) Coordination with other credits.--This subsection 
        shall not apply to any property to which the energy credit or 
        rehabilitation credit would apply unless the taxpayer elects to 
        waive the application of such credits to such property.
            ``(8) Certain progress expenditure rules made applicable.--
        Rules similar to rules of subsection (c)(4) and (d) of section 
        46 (as in effect on the day before the date of the enactment of 
        the Revenue Reconciliation Act of 1990) shall apply for 
        purposes of this subsection.
            ``(9) Application of subsection.--This subsection shall 
        apply to periods after December 31, 1992, and before January 1, 
        1995, under rules similar to the rules of section 48(m) (as in 
        effect on the day before the date of the enactment of the 
        Revenue Reconciliation Act of 1990).''
    (c) Technical Amendments.--
            (1) Clause (ii) of section 49(a)(1)(C) of such Code is 
        amended by inserting ``or qualified manufacturing and 
        productive equipment property'' after ``energy property''.
            (2) Subparagraph (E) of section 50(a)(2) of such Code is 
        amended by inserting ``or 48(c)(5)'' before the period at the 
        end thereof.
            (3) Paragraph (5) of section 50(a) of such Code is amended 
        by adding at the end thereof the following new subparagraph:
                    ``(D) Special rules for certain property.--In the 
                case of any qualified manufacturing and productive 
                equipment property which is 3-year property (within the 
                meaning of section 168(e))--
                            ``(i) the percentage set forth in clause 
                        (ii) of the table contained in paragraph (1)(B) 
                        shall be 66 percent,
                            ``(ii) the percentage set forth in clause 
                        (iii) of such table shall be 33 percent, and
                            ``(iii) clauses (iv) and (v) of such table 
                        shall not apply.''
            (4)(A) The section heading for section 48 of such Code is 
        amended to read as follows:

``SEC. 48. OTHER CREDITS.''

            (B) The table of sections for subpart E of part IV of 
        subchapter A of chapter 1 of such Code is amended by striking 
        the item relating to section 48 and inserting the following:

                              ``Sec. 48. Other credits.''
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after December 31, 1992.