I 

111TH CONGRESS 

1ST SESSION H. R. 3178 

To amend the Internal Revenue Code of 1986 to allow the expensing of 

certain real property. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 10, 2009 

Ms. MARKEY of Colorado (for herself, Mr. LUETKEMEYER, Mr. GRAYSON, Mr. 

PAUL, Ms. GINNY BROWN-WAITE of Florida, Mr. BUCHANAN, Mr. 

BRIGHT, and Mrs. KIRKPATRICK of Arizona) 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 the 

expensing of certain real property. 

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 ‘‘Small Business Growth 

5 Act of 2009’’. 

6 SEC. 2. EXPENSING FOR CERTAIN REAL PROPERTY. 

7 (a) IN GENERAL.—Part VI of subchapter B of chap8 ter 1 is amended by inserting after section 179E the fol9 lowing new section: 


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1 ‘‘SEC. 179F. ELECTION TO EXPENSE CERTAIN REAL PROP2 ERTY. 

3 ‘‘(a) TREATMENT AS EXPENSES.—In the case of a 

4 taxpayer described in subsection (e), the taxpayer may 

5 elect to treat the cost of any qualified real property as 

6 an expense which is not chargeable to capital account. Any 

7 cost so treated shall be allowed as a deduction for the tax8 able year in which the qualified real property is placed 

9 in service. 

10 ‘‘(b) LIMITATION.— 

11 ‘‘(1) IN GENERAL.—The aggregate cost which 

12 may be taken into account under subsection (a) for 

13 any taxable year shall not exceed $125,000. 

14 ‘‘(2) INFLATION ADJUSTMENT.— 

15 ‘‘(A) IN GENERAL.—In the case of any 

16 taxable year beginning in a calendar year after 

17 2009, the $125,000 amount in paragraph (1) 

18 shall be increased by an amount equal to— 

19 ‘‘(i) such dollar amount, multiplied by 

20 ‘‘(ii) the cost-of-living adjustment de21 termined under section 1(f)(3) for the cal22 endar year in which the taxable year be23 gins, by substituting ‘calendar year 2008’ 

24 for ‘calendar year 1992’ in subparagraph 

25 (B) thereof. 


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1 ‘‘(B) ROUNDING.—If any amount as ad2 justed under subparagraph (A) is not a multiple 

3 of $1,000, such amount shall be rounded to the 

4 nearest multiple of $1,000. 

5 ‘‘(c) ELECTION.— 

6 ‘‘(1) IN GENERAL.—An election under this sec7 tion for any taxable year shall be made on the tax8 payer’s return of the tax imposed by this chapter for 

9 the taxable year. Such election shall specify the 

10 qualified real property to which the election applies 

11 and shall be made in such manner as the Secretary 

12 may by regulations prescribe. 

13 ‘‘(2) ELECTION IRREVOCABLE.—Any election 

14 made under this section may not be revoked except 

15 with the consent of the Secretary. 

16 ‘‘(d) QUALIFIED REAL PROPERTY.—For purposes of 

17 this section, the term ‘qualified real property’ means sec18 tion 1250 property (as defined by section 1250(c)) located 

19 in the United States— 

20 ‘‘(1) the original use of which commences with 

21 the taxpayer, and 

22 ‘‘(2) which is placed in service by the taxpayer 

23 after the date of the enactment of this section. 

24 ‘‘(e) TAXPAYER DESCRIBED.— 


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1 ‘‘(1) IN GENERAL.—A taxpayer is described in 

2 this subsection if, for the immediately prior taxable 

3 year, the taxpayer (or any predecessor) met the 

4 $5,000,000 gross receipts test of paragraph (2). 

5 ‘‘(2) $5,000,000 GROSS RECEIPTS TEST.—For 

6 purposes of paragraph (1)— 

7 ‘‘(A) IN GENERAL.—A taxpayer meets the 

8 $5,000,000 gross receipts test of this paragraph 

9 for a taxable year if the average annual gross 

10 receipts of the taxpayer for the 3-taxable-year 

11 period ending with such taxable year does not 

12 exceed $5,000,000. 

13 ‘‘(B) AGGREGATION RULES.—All persons 

14 treated as a single employer under subsection 

15 (a) or (b) of section 52 or subsection (m) or (o) 

16 of section 414 shall be treated as one person for 

17 purposes of subparagraph (A). 

18 ‘‘(C) NOT IN EXISTENCE FOR ENTIRE 3- 

19 YEAR PERIOD.—If the taxpayer was not in ex20 istence for the entire 3-year period referred to 

21 in subparagraph (A), such paragraph shall be 

22 applied on the basis of the period during which 

23 the taxpayer (or trade or business) was in exist24 ence. 


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1 ‘‘(D) SPECIAL RULES.—For purposes of 

2 subparagraph (A), the rules of paragraph (3) of 

3 section 448(c) shall apply. 

4 ‘‘(f) REPORTING.—No deduction shall be allowed 

5 under subsection (a) to any taxpayer for any taxable year 

6 unless the taxpayer files with the Secretary a report con7 taining such information as the Secretary shall require.’’. 

8 (b) CONFORMING AMENDMENTS.— 

9 (1) Section 263(a)(1) is amended by striking 

10 ‘‘or’’ at the end of subparagraph (K), by striking the 

11 period at the end of subparagraph (L) and inserting 

12 ‘‘, or’’, and by inserting after subparagraph (L) the 

13 following new subparagraph: 

14 ‘‘(M) expenditures for which a deduction is 

15 allowed under section 179F.’’. 

16 (2) Section 312(k)(3)(B) is amended by strik17 ing ‘‘or 179E’’ each place it appears in the heading 

18 and text thereof and inserting ‘‘179E, or 179F’’. 

19 (3) The table of sections for part VI of sub20 chapter B of chapter 1 is amended by inserting after 

21 the item relating to section 179E the following new 

22 item: 

‘‘Sec. 179F. Election to expense certain real property.’’. 


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

2 this section shall apply to costs paid or incurred after the 

3 date of the enactment of this Act. 

Æ 


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