Support Our Start-Ups Act

To amend the Internal Revenue Code of 1986 to increase the limitations for deductible new business expenditures and to consolidate provisions for start-up and organizational expenditures. 1. Short title This Act may be cited as the Support Our Start-Ups Act 2. New business expenditures (a) In general Subsections (a) and (b) of section 195 and organizational start-up (b) Organizational expenditures Subsection (c) of section 195 of such Code is amended by adding at the end the following new paragraph: (3) Organizational expenditures The term organizational expenditures (A) is incident to the creation of a corporation or a partnership, (B) is chargeable to capital account, and (C) is of a character which, if expended incident to the creation of a corporation or a partnership having a limited life, would be amortizable over such life. . (c) Dollar amounts Clause (ii) of section 195(b)(1)(A) of such Code is amended— (1) by striking $5,000 $20,000 (2) by striking $50,000 $120,000 (d) Amortization treatment Subparagraph (B) of section 195(b)(1) of such Code, as amended by subsection (a), is amended to read as follows: (B) the remainder of such start-up and organizational expenditures shall be charged to capital account and allowed as an amortization deduction determined by amortizing such expenditures ratably over the 15-year period beginning with the midpoint of the taxable year in which the active trade or business begins. . (e) Conforming amendments (1) Section 195(b)(1) of such Code is amended— (A) by inserting (or, in the case of a partnership, the partnership elects) If a taxpayer elects (B) by inserting (or the partnership, as the case may be) the taxpayer (2) Section 195(b)(2) of such Code is amended— (A) by striking amortization period.— amortization period.— (A) In general In any case , and (B) by adding at the end the following new subparagraph: (B) Special partnership rule In the case of a partnership, subparagraph (A) shall be applied at the partnership level. . (3) Section 195(b) of such Code is amended by striking paragraph (3). (4) (A) Part VIII of subchapter B of chapter 1 of such Code is amended by striking section 248 (and by striking the item relating to such section in the table of sections for such part). (B) Section 56(g)(4)(D)(ii) of such Code is amended by striking Sections 173 and 248 Section 173 (C) Section 170(b)(2)(C)(ii) of such Code is amended by striking (except section 248) (D) Section 312(n)(3) of such Code is amended by striking Sections 173 and 248 Section 173 (E) Section 535(b)(3) of such Code is amended by striking (except section 248) (F) Section 545(b)(3) of such Code is amended by striking (except section 248) (G) Section 834(c)(7) of such Code is amended by striking (except section 248) (H) Section 852(b)(2)(C) of such Code is amended by striking (except section 248) (I) Section 857(b)(2)(A) of such Code is amended by striking (except section 248) (J) Section 1363(b) of such Code is amended by inserting and (K) Section 1375(b)(1)(B)(i) of such Code is amended by striking (other than the deduction allowed by section 248, relating to organization expenditures) (5) Part I of subchapter K of chapter 1 of such Code is amended by striking section 709 (and by striking the item relating to such section in the table of sections for such part). (6) The heading of section 195 of such Code (and the item relating to such section in the table of sections for part VI of subchapter B of chapter 1 of such Code) are each amended by inserting and organizational Start-up (f) Effective date The amendments made by this section shall apply to expenses paid or incurred in taxable years beginning after December 31, 2017.

Summary: Support Our Start-Ups Act This bill amends the Internal Revenue Code to extend the tax deduction for new business expenditures to organizational expenditures, generally defined as expenditures incident to the creation of a corporation or a partnership. The bill also increases the maximum deduction amount for start-up and organizational expenditures from $5,000 to $20,000 and increases from $50,000 to $120,000 the threshold amount after which the maximum deduction amount for such expenditures is reduced.