I 
114TH CONGRESS 
1ST SESSION H. R. 4039 
To amend the Internal Revenue Code of 1986 to establish a small business 
start-up tax credit for veterans. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 17, 2015 
Ms. ADAMS (for herself, Ms. JUDY CHU of California, Ms. KELLY of Illinois, 
Mrs. LAWRENCE, Mr. PAYNE, Mr. TAKAI, and Ms. VELA´ZQUEZ) intro-
duced the following bill; which was referred to the Committee on Ways 
and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to establish 
a small business start-up tax credit for veterans. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Veteran Small Busi-
ness Tax Credit Act of 2015’’. 
SEC. 2. VETERAN SMALL BUSINESS START-UP CREDIT. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
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1986 is amended by adding at the end the following new 
section: 
‘‘SEC. 45S. VETERAN SMALL BUSINESS START-UP CREDIT. 
‘‘(a) IN GENERAL.—For purposes of section 38, in 
the case of an applicable veteran-owned business which 
elects the application of this section, the veteran small 
business start-up credit determined under this section for 
any taxable year is an amount equal to 15 percent of so 
much of the qualified start-up expenditures of the tax-
payer as does not exceed $80,000. 
‘‘(b) APPLICABLE VETERAN-OWNED SMALL BUSI-
NESS.—For purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘applicable vet-
eran-owned small business’ means a small business 
controlled by one or more qualified veterans. 
‘‘(2) QUALIFIED VETERAN.—The term ‘quali-
fied veteran’ means any individual (or the spouse or 
surviving spouse of such an individual) who— 
‘‘(A) has served on active duty in the 
Armed Forces of the United States, and 
‘‘(B) who has not been discharged or re-
leased from the Armed Forces of the United 
States under dishonorable conditions. 
‘‘(3) CONTROL.—The term ‘controlled’ means— 
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‘‘(A) management and operation of the 
daily business, and— 
‘‘(B)(i) in the case of a sole proprietorship, 
sole ownership, 
‘‘(ii) in the case of a corporation, owner-
ship (by vote or value) of not less than 51 per-
cent of the stock in such corporation, or 
‘‘(iii) in the case of a partnership or joint 
venture, ownership of not less than 51 percent 
of the profits interests or capital interests in 
such partnership or joint venture. 
‘‘(4) SMALL BUSINESS.—The term ‘small busi-
ness’ means, with respect to any taxable year, any 
person engaged in a trade or business in the United 
States if— 
‘‘(A) the gross receipts of such person for 
the preceding taxable year did not exceed 
$5,000,000, or 
‘‘(B) in the case of a person to which sub-
paragraph (A) does not apply, such person em-
ployed not more than 100 full-time employees 
during the preceding taxable year. 
For purposes of subparagraph (B), an employee 
shall be considered full-time if such employee is em-
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ployed at least 30 hours per week for 20 or more 
calendar weeks in the taxable year. 
‘‘(c) QUALIFIED START-UP EXPENDITURES.—For 
purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘qualified start- 
up expenditures’ means— 
‘‘(A) any start-up expenditures (as defined 
in section 195(c)), or 
‘‘(B) any amounts paid or incurred during 
the taxable year for the purchase or lease of 
real property, or the purchase of personal prop-
erty, placed in service during the taxable year 
and used in the active conduct of a trade or 
business. 
‘‘(d) SPECIAL RULES.—For purposes of this sec-
tion— 
‘‘(1) YEAR OF ELECTION.—The taxpayer may 
elect the application of this section only for the first 
2 taxable years for which ordinary and necessary ex-
penses paid or incurred in carrying on such trade or 
business are allowable as a deduction by the tax-
payer under section 162. 
‘‘(2) CONTROLLED GROUPS AND COMMON CON-
TROL.—All persons treated as a single employer 
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under subsections (a) and (b) of section 52 shall be 
treated as 1 person. 
‘‘(3) NO DOUBLE BENEFIT.—If a credit is de-
termined under this section with respect to any 
property, the basis of such property shall be reduced 
by the amount of the credit attributable to such 
property.’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
for subpart D of part IV of subchapter A of chapter 1 
of such Code is amended by adding at the end the fol-
lowing new item: 
‘‘Sec. 45S. Veteran small business start-up credit.’’. 
(c) MADE PART OF GENERAL BUSINESS CREDIT.— 
Section 38(b) of such Code is amended by striking ‘‘plus’’ 
at the end of paragraph (35), by striking the period at 
the end of paragraph (36) and inserting ‘‘, plus’’, and by 
adding at the end the following new paragraph: 
‘‘(37) the veteran small business start-up credit 
determined under section 45S.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2016. 
Æ 
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