Small Business Tax Certainty and Growth Act of 2015

To amend the Internal Revenue Code of 1986 to provide tax incentives for small businesses. 1. Short title This Act may be cited as the Small Business Tax Certainty and Growth Act of 2015 2. Sense of the Senate regarding tax reform It is the sense of the Senate that Congress should undertake comprehensive tax reform legislation to— (1) make our system fairer and simpler; and (2) promote economic growth. 3. Permanent doubling of deductions for start-up expenses, organizational expenses, and syndication fees (a) Start-Up expenses (1) In general Clause (ii) of section 195(b)(1)(A) (A) by striking $5,000 $10,000 (B) by striking $50,000 $60,000 (2) Conforming amendment Subsection (b) of section 195 of such Code is amended by striking paragraph (3). (b) Organizational expenses Subparagraph (B) of section 248(a)(1) (1) by striking $5,000 $10,000 (2) by striking $50,000 $60,000 (c) Organization and syndication fees Clause (ii) of section 709(b)(1)(A) (1) by striking $5,000 $10,000 (2) by striking $50,000 $60,000 (d) Effective date The amendments made by this section shall apply to amounts paid or incurred in taxable years ending on or after the date of the enactment of this Act. 4. Clarification of cash accounting rules for small business (a) Cash accounting permitted (1) In general Section 446 (g) Certain small business taxpayers permitted To use cash accounting method without limitation (1) In general An eligible taxpayer shall not be required to use an accrual method of accounting for any taxable year. (2) Eligible taxpayer For purposes of this subsection, a taxpayer is an eligible taxpayer with respect to any taxable year if— (A) for all prior taxable years beginning after December 31, 2015, the taxpayer (or any predecessor) met the gross receipts test of section 448(c), and (B) the taxpayer is not subject to section 447 or 448. . (2) Expansion of gross receipts test (A) In general Paragraph (3) of section 448(b) of such Code is amended by striking $5,000,000 $10,000,000 (B) Conforming amendments Section 448(c) of such Code is amended— (i) by striking $5,000,000 $10,000,000 (ii) by adding at the end the following new paragraph: (4) Inflation adjustment In the case of any taxable year beginning in a calendar year after 2016, the dollar amount contained in subsection (b)(3) and paragraph (1) of this subsection shall be increased by an amount equal to— (A) such dollar amount, multiplied by (B) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, by substituting calendar year 2015 calendar year 1992 If any amount as adjusted under this subparagraph is not a multiple of $100,000, such amount shall be rounded to the nearest multiple of $100,000. . (b) Clarification of inventory rules for small business (1) In general Section 471 (c) Small business taxpayers not required To use inventories (1) In general A qualified taxpayer shall not be required to use inventories under this section for a taxable year. (2) Treatment of taxpayers not using inventories If a qualified taxpayer does not use inventories with respect to any property for any taxable year beginning after December 31, 2015, such property shall be treated as a material or supply which is not incidental. (3) Qualified taxpayer For purposes of this subsection, the term qualified taxpayer (A) any eligible taxpayer (as defined in section 446(g)(2)), and (B) any taxpayer described in section 448(b)(3). . (2) Increased eligibility for simplified dollar-value LIFO method Section 474(c) of such Code is amended by striking $5,000,000 the dollar amount in effect under section 448(c)(1) (c) Effective date and special rules (1) In general The amendments made by this section shall apply to taxable years beginning after December 31, 2015. (2) Change in method of accounting In the case of any taxpayer changing the taxpayer’s method of accounting for any taxable year under the amendments made by this section— (A) such change shall be treated as initiated by the taxpayer; (B) such change shall be treated as made with the consent of the Secretary of the Treasury; and (C) the net amount of the adjustments required to be taken into account by the taxpayer under section 481 5. Permanent extension of expensing limitation (a) Dollar limitation Section 179(b)(1) shall not exceed shall not exceed $500,000. (b) Reduction in limitation Section 179(b)(2) exceeds exceeds $2,000,000. (c) Inflation adjustment Subsection (b) of section 179 (6) Inflation adjustment (A) In general In the case of any taxable year beginning in a calendar year after 2016, the $500,000 in paragraph (1) and the $2,000,000 amount in paragraph (2) shall each be increased by an amount equal to— (i) such dollar amount, multiplied by (ii) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, by substituting calendar year 2015 calendar year 1992 (B) Rounding (i) Dollar limitation If the amount in paragraph (1) as increased under subparagraph (A) is not a multiple of $1,000, such amount shall be rounded to the nearest multiple of $1,000. (ii) Phaseout amount If the amount in paragraph (2) as increased under subparagraph (A) is not a multiple of $10,000, such amount shall be rounded to the nearest multiple of $10,000. . (d) Computer software Section 179(d)(1)(A)(ii) and before 2015 (e) Election Section 179(c)(2) and before 2015 (f) Special rules for treatment of qualified real property (1) In general Section 179(f)(1) after 2009 and before 2015 after 2009 (2) Conforming amendment Section 179(f) of such Code is amended by striking paragraph (4). (g) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2015. 6. Extension of bonus depreciation (a) In general Paragraph (2) of section 168(k) (1) by striking January 1, 2016 January 1, 2017 (2) by striking January 1, 2015 January 1, 2016 (b) Special rule for Federal long-Term contracts Clause (ii) of section 460(c)(6)(B) January 1, 2015 (January 1, 2016 January 1, 2016 (January 1, 2017 (c) Conforming Amendments (1) The heading for subsection (k) of section 168 January 1, 2015 January 1, 2016 (2) The heading for clause (ii) of section 168(k)(2)(B) of such Code is amended by striking Pre-January 1, 2015 Pre-January 1, 2016 (3) Section 168(k)(4)(D) of such Code is amended by striking and (iv) January 1, 2016 January 1, 2017 (v) January 1, 2015 January 1, 2016 . (4) Section 168(l)(4) of such Code is amended by striking and (B) by substituting January 1, 2015 January 1, 2016 . (5) Clause (ii) of section 168(n)(2)(C) of such Code is amended by striking January 1, 2015 January 1, 2016 (6) Subparagraph (D) of section 1400L(b)(2) of such Code is amended by striking January 1, 2015 January 1, 2016 (7) Subparagraph (B) of section 1400N(d)(3) of such Code is amended by striking January 1, 2015 January 1, 2016 (d) Effective date The amendments made by this section shall apply to property placed in service after December 31, 2015, in taxable years ending after such date. 7. Extension of 15-year straight-line cost recovery for qualified leasehold improvements, qualified restaurant buildings and improvements, and qualified retail improvements (a) In general Subparagraph (E) of section 168(e)(3) (1) by striking property placed in service before January 1, 2015, property, (2) by striking , and before January 1, 2015 (b) Effective date The amendments made by this section shall apply to property placed in service after December 31, 2015.

Summary: Small Business Tax Certainty and Growth Act of 2015 Expresses the sense of the Senate that Congress should undertake comprehensive tax reform to make the tax system fairer and simpler and to promote economic growth. Amends the Internal Revenue Code to: (1) make permanent the increased tax deductions for business start-up expenditures, organizational expenditures, and organization and syndication fees; (2) allow the cash accounting method for businesses whose gross receipts do not exceed $10 million (currently, $5 million); (3) exempt businesses whose gross receipts do not exceed $10 million from the requirement to use inventories; (4) make permanent a $500,000 allowance for expensing business assets, including computer software; (5) extend for one year the additional depreciation allowance for business assets (bonus depreciation); and (6) make permanent the 15-year straight-line depreciation allowance for qualified leasehold improvement, restaurant, and retail improvement property.