SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Igniting American Research Act''.

SEC. 2. 1-YEAR EXTENSION OF RESEARCH CREDIT; ALTERNATIVE SIMPLIFIED 
              RESEARCH CREDIT INCREASED AND MADE PERMANENT.

    (a) 1-Year Extension of Credit.--
            (1) In general.--Subparagraph (B) of section 41(h)(1) of 
        the Internal Revenue Code of 1986 is amended by striking 
        ``December 31, 2013'' and inserting ``December 31, 2014''.
            (2) Conforming amendment.--Subparagraph (D) of section 
        45C(b)(1) of such Code is amended by striking ``December 31, 
        2013'' and inserting ``December 31, 2014''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply to amounts paid or incurred after December 31, 
        2013.
    (b) Alternative Simplified Research Credit Increased and Made 
Permanent.--
            (1) Increased credit.--Subparagraph (A) of section 41(c)(5) 
        of such Code (relating to election of alternative simplified 
        credit) is amended by striking ``14 percent (12 percent in the 
        case of taxable years ending before January 1, 2009)'' and 
        inserting ``20 percent''.
            (2) Credit made permanent.--
                    (A) In general.--Subsection (h) of section 41 of 
                such Code is amended by redesignating the paragraph (2) 
                relating to computation of taxable year in which credit 
                terminates as paragraph (4) and by inserting before 
                such paragraph the following new paragraph:
            ``(3) Termination not to apply to alternative simplified 
        credit.--Paragraph (1) shall not apply to the credit determined 
        under subsection (c)(5).''.
                    (B) Conforming amendment.--Paragraph (4) of section 
                41(h) of such Code, as redesignated by subparagraph 
                (A), is amended to read as follows:
            ``(4) Computation for taxable year in which credit 
        terminates.--In the case of any taxable year with respect to 
        which this section applies to a number of days which is less 
        than the total number of days in such taxable year, the amount 
        determined under subsection (c)(1)(B) with respect to such 
        taxable year shall be the amount which bears the same ratio to 
        such amount (determined without regard to this paragraph) as 
        the number of days in such taxable year to which this section 
        applies bears to the total number of days in such taxable 
        year.''.
            (3) Effective date.--The amendments made by this subsection 
        shall apply to taxable years ending after December 31, 2013.

SEC. 3. BIOTECHNOLOGY RESEARCH.

    (a) 20 Percent Credit for Payments to Biotechnology Research 
Consortium for Biotechnology Research.--
            (1) In general.--Section 41(a)(3) of the Internal Revenue 
        Code of 1986 is amended by inserting ``or a biotechnology 
        research consortium for biotechnology research'' before the 
        period at the end.
            (2) Limitation.--Section 41(a) of the Internal Revenue Code 
        of 1986 is amended by adding at the end the following flush 
        sentence: ``The amounts taken into account for purposes of 
        paragraph (3) for a taxable year may not exceed the greater of 
        20 percent of the amounts paid or incurred by the taxpayer 
        during the taxable year (including as contributions) to an 
        energy research consortium for energy research or 20 percent of 
        the amounts paid or incurred by the taxpayer during the taxable 
        year (including as contributions) to a biotechnology research 
        consortium for biotechnology research.''.
    (b) Biotechnology Contract Research Expenses.--Section 
41(b)(3)(D)(i) of the Internal Revenue Code of 1986 is amended by 
striking ``energy research'' and inserting ``energy or biotechnology 
research''.
    (c) Special Rules.--Subparagraphs (A)(ii) and (B)(ii) of section 
41(f)(1) of the Internal Revenue Code of 1986 are both amended by 
striking ``consortiums,'' and inserting ``consortiums and to 
biotechnology research consortiums,''.
    (d) Biotechnology Research Consortium Defined.--Section 41(f) of 
the Internal Revenue Code of 1986 is amended by adding at the end the 
following new paragraph:
            ``(7) Biotechnology research consortium.--
                    ``(A) In general.--The term `biotechnology research 
                consortium' means any organization--
                            ``(i) which is--
                                    ``(I) described in section 
                                501(c)(3) and is exempt from tax under 
                                section 501(a) and is organized and 
                                operated primarily to conduct 
                                biotechnology research, or
                                    ``(II) organized and operated 
                                primarily to conduct biotechnology 
                                research in the public interest (within 
                                the meaning of section 501(c)(3)),
                            ``(ii) which is not a private foundation,
                            ``(iii) to which at least 3 unrelated 
                        persons paid or incurred during the calendar 
                        year in which the taxable year of the 
                        organization begins amounts (including as 
                        contributions) to such organization for 
                        biotechnology research, and
                            ``(iv) to which no single person paid or 
                        incurred (including as contributions) during 
                        such calendar year an amount equal to more than 
                        50 percent of the total amounts received by 
                        such organization during such calendar year for 
                        biotechnology research.
                    ``(B) Applicable rules.--For purposes of 
                subparagraph (A), rules similar to the rules of 
                subparagraphs (B), (C) (applied by substituting 
                `biotechnology' for `research'), and (D) of paragraph 
                (6) shall apply.
                    ``(C) Biotechnology research.--The term 
                `biotechnology research' does not include--
                            ``(i) any research which is not qualified 
                        research, and
                            ``(ii) any research which is energy 
                        research.''.
    (e) Energy Research Consortium.--Section 41(f)(A)(iii) of the 
Internal Revenue Code of 1986 is amended by striking ``5 unrelated 
persons'' and inserting ``3 unrelated persons''.
    (f) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2013.
Igniting American Research Act - Amends the Internal Revenue Code, with respect to the tax credit for increasing research expenditures, to: (1) extend such credit through 2014; (2) increase the rate of the alternative simplified research tax credit to 20% and make such credit permanent; (3) allow a 20% research tax credit for payments to a tax-exempt biotechnology research consortium for biotechnology research; and (4) modify the requirements relating to the eligibility of an energy research consortium for the tax credit to require at least 3 unrelated persons (currently, 5 unrelated persons) to make payments to such a consortium for energy research. 
Igniting American Research Act