I 

112TH CONGRESS 

2D SESSION H. R. 4226 

To amend the Internal Revenue Code of 1986 to make permanent the full 

exclusion applicable to qualified small business stock. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 20, 2012 

Ms. MOORE 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 make 

permanent the full exclusion applicable to qualified small 

business stock. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. PERMANENT FULL EXCLUSION APPLICABLE TO 

4 QUALIFIED SMALL BUSINESS STOCK. 

5 (a) PERMANENT FULL EXCLUSION.— 

6 (1) IN GENERAL.—Subsection (a) of section 

7 1202 of the Internal Revenue Code of 1986 is 

8 amended to read as follows: 

9 ‘‘(a) EXCLUSION.—In the case of a taxpayer other 

10 than a corporation, gross income shall not include 100 


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1 percent of any gain from the sale or exchange of qualified 

2 small business stock held for more than 5 years.’’. 

3 (2) CONFORMING AMENDMENTS.— 

4 (A) The heading for section 1202 of such 

5 Code is amended by striking ‘‘PARTIAL EX6 CLUSION’’ and inserting ‘‘EXCLUSION’’. 

7 (B) The item relating to section 1202 in 

8 the table of sections for part I of subchapter P 

9 of chapter 1 of such Code is amended by strik10 ing ‘‘Partial exclusion’’ and inserting ‘‘Exclu11 sion’’. 

12 (C) Section 1223(13) of such Code is 

13 amended by striking ‘‘1202(a)(2),’’. 

14 (b) REPEAL OF MINIMUM TAX PREFERENCE.— 

15 (1) IN GENERAL.—Subsection (a) of section 57 

16 of the Internal Revenue Code of 1986 is amended by 

17 striking paragraph (7). 

18 (2) TECHNICAL AMENDMENT.—Subclause (II) 

19 of section 53(d)(1)(B)(ii) of such Code is amended 

20 by striking ‘‘, (5), and (7)’’ and inserting ‘‘and (5)’’. 

21 (c) REPEAL OF 28 PERCENT CAPITAL GAINS RATE

22 ON QUALIFIED SMALL BUSINESS STOCK.— 

23 (1) IN GENERAL.—Subparagraph (A) of section 

24 1(h)(4) of the Internal Revenue Code of 1986 is 

25 amended to read as follows: 


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1 ‘‘(A) collectibles gain, over’’. 

2 (2) CONFORMING AMENDMENTS.— 

3 (A) Section 1(h) of such Code is amended 

4 by striking paragraph (7). 

5 (B)(i) Section 1(h) of such Code is amend6 ed by redesignating paragraphs (8), (9), (10), 

7 and (11) as paragraphs (7), (8), (9), and (10), 

8 respectively. 

9 (ii) Sections 163(d)(4)(B), 854(b)(4), 

10 857(c)(2)(D) of such Code are each amended 

11 by striking ‘‘section 1(h)(11)(B)’’ and inserting 

12 ‘‘section 1(h)(10)(B)’’. 

13 (iii) The following sections of such Code 

14 are each amended by striking ‘‘section 

15 1(h)(11)’’ each place it appears and inserting 

16 ‘‘section 1(h)(10)’’: 

17 (I) Section 301(f)(4). 

18 (II) Section 306(a)(1)(D). 

19 (III) Section 584(c). 

20 (IV) Section 702(a)(5). 

21 (V) Section 854(a). 

22 (VI) Section 911(f)(2). 

23 (iv) The heading of section 857(c)(2) of 

24 such Code is amended by striking ‘‘1(H)(11)’’ 

25 and inserting ‘‘1(H)(10)’’. 


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1 (d) EFFECTIVE DATE.—The amendments made by 

2 this section apply to stock acquired after December 31, 

3 2011. 

Æ 


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