I 
111TH CONGRESS 
1ST SESSION H. R. 2672 
To amend the Internal Revenue Code of 1986 to allow credits for the 
establishment of franchises with veterans. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 3, 2009 
Mr. SCHOCK (for himself and Mr. BOSWELL) 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 credits 
for the establishment of franchises with 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 ‘‘Help Veterans Own 
Franchises Act’’. 
SEC. 2. VETERANS FRANCHISING CREDIT. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
1986 (relating to business related credits) is amended by 
adding at the end the following new section: 
VerDate Nov 24 2008 
04:27 Jun 04, 2009
Jkt 079200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H2672.IH
H2672
jbell on PROD1PC69 with BILLS
‘‘SEC. 45R. VETERANS FRANCHISING. 
‘‘(a) FRANCHISOR VETERANS DISCOUNT CREDIT.— 
‘‘(1) IN GENERAL.—For purposes of section 38, 
the franchisor veterans discount credit determined 
under this section for the taxable year is an amount 
equal to 50 percent of the qualified franchise fee dis-
count provided by the taxpayer during the taxable 
year. 
‘‘(2) LIMITATION.—The amount allowed as a 
credit under paragraph (1) with respect to the pur-
chase of any franchise shall not exceed $25,000. 
‘‘(b) VETERANS FRANCHISE FEE CREDIT.— 
‘‘(1) IN GENERAL.—For purposes of section 38, 
the veterans franchise fee credit determined under 
this section for the taxable year is an amount equal 
to 25 percent of the qualified franchise fee paid or 
incurred by the taxpayer in connection with the pur-
chase of a franchise in which a qualified franchise 
fee discount is offered by the franchisor. 
‘‘(2) LIMITATION.—For purposes of paragraph 
(1), the amount of franchise fees taken into account 
under paragraph (1) in connection with a franchise 
shall not exceed $100,000. 
‘‘(c) REDUCTION WHERE FRANCHISE NOT 100 PER-
CENT VETERAN-OWNED.—In the case of any franchise in 
which veterans do not own 100 percent of the stock or 
VerDate Nov 24 2008 
04:27 Jun 04, 2009
Jkt 079200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H2672.IH
H2672
jbell on PROD1PC69 with BILLS
of the capital or profits interests of the franchisee, the 
credits under subsections (a) and (b) shall be the credit 
amount determined under each such subsection, multiplied 
by the same ratio as— 
‘‘(1) the stock or capital or profits interests of 
the franchise held by veterans, bears 
‘‘(2) to the total stock or capital or profits in-
terests of the franchisee. 
For purposes of this subsection, the spouse of a veteran 
shall be treated as a veteran. 
‘‘(d) QUALIFIED FRANCHISE FEE DISCOUNT.—For 
purposes of this section, the term ‘qualified franchise fee 
discount’ means with respect to a franchise arrange-
ment— 
‘‘(1) the amount of the franchise fee offer listed 
in the most recent franchise disclosure document of 
the franchisor, over 
‘‘(2) the qualified franchise fee actually paid. 
‘‘(e) QUALIFIED FRANCHISE FEE.—For purposes of 
this section, the term ‘qualified franchise fee’ means any 
one-time fee required by the franchisor when entering into 
a franchise with a qualified veteran. 
‘‘(f) OTHER DEFINITIONS.—For purposes of this sec-
tion, the terms ‘franchise’, ‘franchisee’, ‘franchisor’, ‘fran-
chise fee’, and ‘franchise disclosure document’ have the 
VerDate Nov 24 2008 
04:27 Jun 04, 2009
Jkt 079200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H2672.IH
H2672
jbell on PROD1PC69 with BILLS
meanings given such terms in part 436 of title 16, Code 
of Federal Regulations (as in effect on January 1, 2009). 
‘‘(g) VETERAN.—The term ‘veteran’ has the meaning 
given such term by section 101 of title 38, United States 
Code. 
‘‘(h) ELECTION.—This section shall not apply to a 
taxpayer for any taxable year if such taxpayer elects to 
have this section not apply for such taxable year.’’. 
(b) CREDIT TO BE PART OF GENERAL BUSINESS 
CREDIT.—Section 38(b) of such Code is amended by strik-
ing ‘‘plus’’ at the end of paragraph (34), by striking the 
period at the end of paragraph (35) and inserting a 
comma, and by adding at the end the following new para-
graphs: 
‘‘(36) the franchisor veterans discount credit 
determined under section 45R(a), plus 
‘‘(37) the veterans franchise fee credit deter-
mined under section 45R(b).’’. 
(c) 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. 45R. Veterans franchising.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years ending after De-
cember 31, 2008. 
VerDate Nov 24 2008 
04:27 Jun 04, 2009
Jkt 079200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H2672.IH
H2672
jbell on PROD1PC69 with BILLS
SEC. 3. PUBLICATION OF INFORMATION BY DEPARTMENT 
OF VETERANS AFFAIRS AND SMALL BUSI-
NESS ADMINISTRATION. 
The Administrator of the Small Business Administra-
tion and the Secretary of Veterans Affairs shall publicize 
in mailings and brochures sent to veterans service organi-
zations and veteran advocacy groups information regard-
ing discounted franchise fees under section 45R of the In-
ternal Revenue Code of 1986 and other information about 
the program established under amendments made by this 
Act. 
Æ 
VerDate Nov 24 2008 
04:27 Jun 04, 2009
Jkt 079200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6301
E:\BILLS\H2672.IH
H2672
jbell on PROD1PC69 with BILLS