`[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 1770 Placed on Calendar Senate (PCS)]






                                                       Calendar No. 342
106th CONGRESS
  1st Session
                                S. 1770

 To amend the Internal Revenue Code of 1986 to permanently extend the 
 research and development credit and to extend certain other expiring 
           provisions for 30 months, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            October 22, 1999

    Mr. Lott (for himself, Mr. Hatch, Mr. Craig, Mr. Coverdell, Mr. 
    McConnell, Mr. Gregg, Mr. Gorton, Mr. Frist, and Mr. Ashcroft) 
      introduced the following bill; which was read the first time

                            October 25, 1999

            Read the second time and placed on the calendar

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to permanently extend the 
 research and development credit and to extend certain other expiring 
           provisions for 30 months, and for other purposes.

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

SECTION 1. SHORT TITLE; ETC.

    (a) Short Title.--This Act may be cited as the ``Clear Extenders 
Act of 1999''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.
    (c) Table of Contents.--The table of contents for this Act is as 
follows:

               TITLE I--EXTENSION OF EXPIRING INCENTIVES

SEC. 101. PERMANENT EXTENSION OF RESEARCH AND DEVELOPMENT CREDIT.

    (a) Extension.--
            (1) In general.--Section 41 (relating to credit for 
        increasing research activities) is amended by striking 
        subsection (h).
            (2) Technical amendment.--Section 45C(b)(1) is amended by 
        striking subparagraph (D).
            (3) Effective date.--The amendments made by this subsection 
        shall apply to amounts paid or incurred after June 30, 1999.
    (b) Increase in Percentages Under Alternative Incremental Credit.--
            (1) In general.--Subparagraph (A) of section 41(c)(4) of 
        such Code is amended--
                    (A) by striking ``1.65 percent'' and inserting 
                ``2.65 percent'',
                    (B) by striking ``2.2 percent'' and inserting ``3.2 
                percent'', and
                    (C) by striking ``2.75 percent'' and inserting 
                ``3.75 percent''.
            (2) Effective date.--The amendments made by this subsection 
        shall apply to taxable years beginning after June 30, 1999.
    (c) Special Rule.--
            (1) In general.--For purposes of the Internal Revenue Code 
        of 1986, the credit determined under section 41 of such Code 
        which is otherwise allowable under such Code and which is 
        attributable to the suspension period shall not be taken into 
        account prior to October 1, 2000. On or after such date, such 
        credit may be taken into account through the filing of an 
        amended return, an application for expedited refund, an 
        adjustment of estimated taxes, or other means allowed by such 
        Code.
            (2) Suspension period.--For purposes of this subsection, 
        the suspension period is the period beginning on July 1, 1999, 
        and ending on September 30, 2000.
            (3) Expedited refunds.--
                    (A) In general.--If there is an overpayment of tax 
                with respect to a taxable year by reason of paragraph 
                (1), the taxpayer may file an application for a 
                tentative refund of such overpayment. Such application 
                shall be in such manner and form, and contain such 
                information, as the Secretary may prescribe.
                    (B) Deadline for applications.--Subparagraph (A) 
                shall apply only to applications filed before October 
                1, 2001.
                    (C) Allowance of adjustments.--Not later than 90 
                days after the date on which an application is filed 
                under this paragraph, the Secretary shall--
                            (i) review the application,
                            (ii) determine the amount of the 
                        overpayment, and
                            (iii) apply, credit, or refund such 
                        overpayment,
                in a manner similar to the manner provided in section 
                6411(b) of such Code.
                    (D) Consolidated returns.--The provisions of 
                section 6411(c) of such Code shall apply to an 
                adjustment under this paragraph in such manner as the 
                Secretary may provide.
            (4) Credit attributable to suspension period.--
                    (A) In general.--For purposes of this subsection, 
                in the case of a taxable year which includes a portion 
                of the suspension period, the amount of credit 
                determined under section 41 of such Code for such 
                taxable year which is attributable to such period is 
                the amount which bears the same ratio to the amount of 
                credit determined under such section 41 for such 
                taxable year as the number of months in the suspension 
                period which are during such taxable year bears to the 
                number of months in such taxable year.
                    (B) Waiver of estimated tax penalties.--No addition 
                to tax shall be made under section 6654 or 6655 of such 
                Code for any period before July 1, 1999, with respect 
                to any underpayment of tax imposed by such Code to the 
                extent such underpayment was created or increased by 
                reason of subparagraph (A).
            (5) Secretary.--For purposes of this subsection, the term 
        ``Secretary'' means the Secretary of the Treasury (or such 
        Secretary's delegate).

SEC. 102. EXTENSION OF MINIMUM TAX RELIEF FOR INDIVIDUALS.

    (a) In General.--The second sentence of section 26(a) (relating to 
limitations based on amount of tax) is amended by striking ``1998'' and 
inserting ``calendar years 1998, 1999, 2000, and 2001''.
    (b) Child Credit.--Section 24(d)(2) (relating to reduction of 
credit to taxpayer subject to alternative minimum tax) is amended by 
striking ``December 31, 1998'' and inserting ``December 31, 2001''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1998.

SEC. 103. SUBPART F EXEMPTION FOR ACTIVE FINANCING INCOME.

    (a) In General.--Sections 953(e)(10) and 954(h)(9) (relating to 
application) are each amended--
            (1) by striking ``the first taxable year'' and inserting 
        ``taxable years'',
            (2) by striking ``January 1, 2000'' and inserting ``January 
        1, 2002'', and
            (3) by striking ``within which such'' and inserting 
        ``within which any such''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1999.

SEC. 104. TAXABLE INCOME LIMIT ON PERCENTAGE DEPLETION FOR MARGINAL 
              PRODUCTION.

    (a) In General.--Subparagraph (H) of section 613A(c)(6) (relating 
to temporary suspension of taxable limit with respect to marginal 
production) is amended by striking ``January 1, 2000'' and inserting 
``January 1, 2002''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 1999.

SEC. 105. WORK OPPORTUNITY CREDIT AND WELFARE-TO-WORK CREDIT.

    (a) Temporary Extension.--Sections 51(c)(4)(B) and 51A(f) (relating 
to termination) are each amended by striking ``June 30, 1999'' and 
inserting ``December 31, 2001''.
    (b) Clarification of First Year of Employment.--Paragraph (2) of 
section 51(i) of such Code is amended by striking ``during which he was 
not a member of a targeted group''.
    (c) Effective Date.--The amendments made by this section shall 
apply to individuals who begin work for the employer after June 30, 
1999.

                        TITLE II--REVENUE OFFSET

SEC. 201. MODIFICATION OF ESTIMATED TAX SAFE HARBOR.

          (a) In General.--The table contained in clause (i) of section 
6654(d)(1)(C) of the Internal Revenue Code of 1986 (relating to 
limitation on use of preceding year's tax) is amended by striking the 
item relating to 1999 or 2000 and inserting the following new items:

    ``1999........................................               108.5 
    2000..........................................               106''.
          (b) Effective Date.--The amendment made by this section shall 
apply with respect to any installment payment for taxable years 
beginning after December 31, 1999.
                                     





                                                       Calendar No. 342

106th CONGRESS

  1st Session

                                S. 1770

_______________________________________________________________________

                                 A BILL

 To amend the Internal Revenue Code of 1986 to permanently extend the 
 research and development credit and to extend certain other expiring 
           provisions for 30 months, and for other purposes.

_______________________________________________________________________

                            October 25, 1999

            Read the second time and placed on the calendar`