I

107TH CONGRESS

1ST SESSION H. R. 1411

To amend the Internal Revenue Code of 1986 to allow qualified technological

equipment and computer software to be expensed, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

APRIL 4, 2001

Mr. WELLER (for himself, Mr. NEAL of Massachusetts, Mrs. KELLY, Mr.

TAUZIN, Mr. GOODLATTE, Mr. COX, Mr. CUNNINGHAM, Mr. ISSA, Mrs.

WILSON, and Mr. EHRLICH) 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 allow qualified technological equipment and computer software to

be expensed, and for other purposes.

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

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Expensing Technology

5 Reform Act of 2001’’.
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1 SEC. 2. EXPENSING OF QUALIFIED TECHNOLOGICAL

2 EQUIPMENT AND COMPUTER SOFTWARE.

3 (a) IN GENERAL.—Part VI of subchapter B of chap4 ter 1 of the Internal Revenue Code of 1986 is amended

5 by inserting after section 179A the following new section:

6 ‘‘SEC. 179B. DEDUCTION FOR QUALIFIED TECHNOLOGICAL

7 EQUIPMENT AND COMPUTER SOFTWARE.

8 ‘‘(a) TREATMENT AS EXPENSES.—A taxpayer may

9 elect to treat the cost of any qualified technological prop10 erty as an expense which is not chargeable to capital ac11 count. Any cost so treated shall be allowed as a deduction

12 for the taxable year in which the qualified technological

13 property is placed in service.

14 ‘‘(b) QUALIFIED TECHNOLOGICAL PROPERTY.—For

15 purposes of this section—

16 ‘‘(1) IN GENERAL.—The term ‘qualified techno17 logical property’ means—

18 ‘‘(A) property to which section 168 applies

19 which is—

20 ‘‘(i) qualified technological equipment

21 (as defined in section 168(i)(2)),

22 ‘‘(ii) any wireless telecommunications

23 equipment,

24 ‘‘(iii) any advanced services equip25 ment, or
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1 ‘‘(iv) any network or network system

2 equipment, and

3 ‘‘(B) computer software (as defined in sec4 tion 197(e)(3)(B)) to which section 167 applies.

5 ‘‘(2) WIRELESS TELECOMMUNICATIONS EQUIP6 MENT.—The term ‘wireless telecommunications

7 equipment’ means all equipment used in the trans8 mission, reception, coordination, or switching of

9 wireless telecommunications service. For this pur10 pose, ‘wireless telecommunications service’ includes

11 any commercial mobile radio service as defined in

12 title 47 of the Code of Federal Regulations.

13 ‘‘(3) ADVANCED SERVICES EQUIPMENT.—The

14 term ‘advanced services equipment’ means equip15 ment, excluding cabling, used in the provision of

16 Internet or electronic communications access services

17 or support, or which supports access to electronic

18 media and data and associated communications sup19 port, provided that such services or support con20 stitute or directly contribute to the provision of ad21 vanced telecommunications capability as that term is

22 defined in section 706(c)(1) of the Telecommuni23 cations Act of 1996.

24 ‘‘(4) NETWORK OR NETWORK SYSTEM EQUIP25 MENT.—The term ‘network or network system
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1 equipment’ means any information technology equip2 ment, including computer servers, hubs, bridges,

3 switches and routers, which are interconnected so as

4 to enable computers and peripherals to communicate

5 with each other either individually or as a single

6 unit.

7 ‘‘(c) CERTAIN RULES TO APPLY.—Rules similar to

8 the rules of paragraphs (4), (5), and (6) of section 179A

9 shall apply for purposes of this section.’’.

10 (b) INCLUSION OF COPIERS, DUPLICATING EQUIP11 MENT, AND OTHER EQUIPMENT.—Clause (iv) of section

12 168(i)(2)(B) of such Code is amended—

13 (1) by striking ‘‘copiers, duplicating equip14 ment,’’ in subclause (II),

15 (2) by adding ‘‘and’’ at the end of subclause

16 (I),

17 (3) by striking ‘‘, and’’ at the end of subclause

18 (II) and inserting a period, and

19 (4) by striking subclause (III).

20 (c) CONFORMING AMENDMENTS.—

21 (1) Paragraph (1) of section 263(a) of such

22 Code is amended by striking ‘‘or’’ at the end of sub23 paragraph (G), by striking the period at the end of

24 subparagraph (H) and inserting ‘‘; or’’, and by add25 ing at the end the following new subparagraph:
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1 ‘‘(I) expenditures for which a deduction is

2 allowed under section 179B.’’.

3 (2) Subparagraph (B) of section 312(k)(3) of

4 such Code is amended by striking ‘‘or 179A’’ each

5 place it appears and inserting ‘‘, 179A, or 179B’’.

6 (3) Subparagraph (C) of section 1245(a)(2) of

7 such Code is amended by inserting ‘‘179B,’’ after

8 ‘‘179A,’’.

9 (4) The table of sections for part VI of sub10 chapter B of chapter 1 of such Code is amended by

11 inserting after the item relating to section 179A the

12 following new item:

‘‘Sec. 179B. Deduction for qualified technological equipment and

computer software.’’.

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

14 this section shall apply to property placed in service after

15 the date of the enactment of this Act.

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