I 
111TH CONGRESS 
2D SESSION 
H. R. 5486 
To amend the Internal Revenue Code of 1986 to provide tax incentives 
for small business job creation, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JUNE 9, 2010 
Mr. LEVIN 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 provide 
tax incentives for small business job creation, and for 
other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
TITLE V—TAX PROVISIONS 
SEC. 500. SHORT TITLE; ETC. 
(a) SHORT TITLE.—This title may be cited as the 
‘‘Small Business Jobs Tax Relief Act of 2010’’. 
(b) AMENDMENT OF 1986 CODE.—Except as other-
wise expressly provided, whenever in this title an amend-
ment or repeal is expressed in terms of an amendment 
to, or repeal of, a section or other provision, the reference 
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shall be considered to be made to a section or other provi-
sion of the Internal Revenue Code of 1986. 
(c) TABLE OF CONTENTS.—The table of contents for 
this title is as follows: 
Sec. 500. Short title; etc. 
Subtitle A—Small Business Tax Incentives 
PART 1—GENERAL PROVISIONS 
Sec. 501. Temporary exclusion of 100 percent of gain on certain small business 
stock. 
PART 2—LIMITATIONS AND REPORTING ON CERTAIN PENALTIES 
Sec. 511. Limitation on penalty for failure to disclose certain information. 
Sec. 512. Annual reports on penalties and certain other enforcement actions. 
PART 3—OTHER PROVISIONS 
Sec. 521. Increase in amount allowed as deduction for start-up expenditures. 
Sec. 522. Nonrecourse small business investment company loans from the Small 
Business Administration treated as amounts at risk. 
Sec. 523. Benefits under the Small Business Borrower Assistance Program ex-
cluded from gross income. 
Subtitle B—Revenue Provisions 
Sec. 531. Required minimum 10-year term, etc., for grantor retained annuity 
trusts. 
Sec. 532. Crude tall oil ineligible for cellulosic biofuel producer credit. 
Sec. 533. Time for payment of corporate estimated taxes. 
Subtitle A—Small Business Tax 
Incentives 
PART 1—GENERAL PROVISIONS 
SEC. 501. TEMPORARY EXCLUSION OF 100 PERCENT OF 
GAIN ON CERTAIN SMALL BUSINESS STOCK. 
(a) IN GENERAL.—Subsection (a) of section 1202 is 
amended by adding at the end the following new para-
graph: 
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‘‘(4) SPECIAL
100
PERCENT
EXCLUSION.—In 
the case of qualified small business stock acquired 
after March 15, 2010, and before January 1, 
2012— 
‘‘(A) paragraph (1) shall be applied by 
substituting ‘100 percent’ for ‘50 percent’, 
‘‘(B) paragraph (2) shall not apply, and 
‘‘(C) paragraph (7) of section 57(a) shall 
not apply.’’. 
(b) CONFORMING AMENDMENTS.—Paragraph (3) of 
section 1202(a) is amended— 
(1) by striking ‘‘after the date of the enactment 
of this paragraph and before January 1, 2011’’ and 
inserting ‘‘after February 17, 2009, and before 
March 16, 2010’’; and 
(2) by striking ‘‘SPECIAL RULES FOR 2009 AND 
2010’’ in the heading and inserting ‘‘SPECIAL
PERCENT EXCLUSION’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to stock acquired after March 15, 
2010. 
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PART 2—LIMITATIONS AND REPORTING ON 
CERTAIN PENALTIES 
SEC. 511. LIMITATION ON PENALTY FOR FAILURE TO DIS-
CLOSE CERTAIN INFORMATION. 
(a) IN GENERAL.—Subsection (b) of section 6707A 
is amended to read as follows: 
‘‘(b) AMOUNT OF PENALTY.— 
‘‘(1) IN GENERAL.—Except as otherwise pro-
vided in this subsection, the amount of the penalty 
under subsection (a) with respect to any reportable 
transaction shall be 75 percent of the decrease in 
tax shown on the return as a result of such trans-
action (or which would have resulted from such 
transaction if such transaction were respected for 
Federal tax purposes). 
‘‘(2) MAXIMUM PENALTY.—The amount of the 
penalty under subsection (a) with respect to any re-
portable transaction for any taxable year shall not 
exceed— 
‘‘(A) in the case of a listed transaction, 
$200,000 ($100,000 in the case of a natural 
person), or 
‘‘(B) in the case of any other reportable 
transaction, $50,000 ($10,000 in the case of a 
natural person). 
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‘‘(3) MINIMUM PENALTY.—The amount of the 
penalty under subsection (a) with respect to any 
transaction for any taxable year shall not be less 
than $10,000 ($5,000 in the case of a natural per-
son).’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to penalties assessed after Decem-
ber 31, 2006. 
SEC. 512. ANNUAL REPORTS ON PENALTIES AND CERTAIN 
OTHER ENFORCEMENT ACTIONS. 
(a) IN GENERAL.—The Commissioner of Internal 
Revenue, in consultation with the Secretary of the Treas-
ury, shall submit to the Committee on Ways and Means 
of the House of Representatives and the Committee on 
Finance of the Senate an annual report on the penalties 
assessed by the Internal Revenue Service during the pre-
ceding year under each of the following provisions of the 
Internal Revenue Code of 1986: 
(1) Section 6662A (relating to accuracy-related 
penalty on understatements with respect to report-
able transactions). 
(2) Section 6700(a) (relating to promoting abu-
sive tax shelters). 
(3) Section 6707 (relating to failure to furnish 
information regarding reportable transactions). 
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(4) Section 6707A (relating to failure to include 
reportable transaction information with return). 
(5) Section 6708 (relating to failure to main-
tain lists of advisees with respect to reportable 
transactions). 
(b) ADDITIONAL
INFORMATION.—The report re-
quired under subsection (a) shall also include information 
on the following with respect to each year: 
(1) Any action taken under section 330(b) of 
title 31, United States Code, with respect to any re-
portable transaction (as defined in section 6707A(c) 
of the Internal Revenue Code of 1986). 
(2) Any extension of the time for assessment of 
tax enforced, or assessment of any amount under 
such an extension, under paragraph (10) of section 
6501(c) of the Internal Revenue Code of 1986. 
(c) DATE OF REPORT.—The first report required 
under subsection (a) shall be submitted not later than De-
cember 31, 2010. 
PART 3—OTHER PROVISIONS 
SEC. 521. INCREASE IN AMOUNT ALLOWED AS DEDUCTION 
FOR START-UP EXPENDITURES. 
(a) IN GENERAL.—Subsection (b) of section 195 is 
amended by adding at the end the following new para-
graph: 
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‘‘(3) INCREASED
LIMITATION
FOR
TAXABLE 
YEARS BEGINNING IN 2010 OR 2011.—In the case of 
any taxable year beginning in 2010 or 2011, para-
graph (1)(A)(ii) shall be applied— 
‘‘(A) 
by 
substituting 
‘$20,000’ 
for 
‘$5,000’, and 
‘‘(B) 
by 
substituting 
‘$75,000’ 
for 
‘$50,000’.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2009. 
SEC. 522. NONRECOURSE SMALL BUSINESS INVESTMENT 
COMPANY LOANS FROM THE SMALL BUSI-
NESS 
ADMINISTRATION 
TREATED 
AS 
AMOUNTS AT RISK. 
(a) IN GENERAL.—Subparagraph (B) of section 
465(b)(6) is amended to read as follows: 
‘‘(B) QUALIFIED
NONRECOURSE
FINANC-
ING.—For purposes of this paragraph— 
‘‘(i) IN GENERAL.—The term ‘quali-
fied nonrecourse financing’ means any fi-
nancing— 
‘‘(I) which is qualified real prop-
erty financing or qualified SBIC fi-
nancing, 
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‘‘(I) is borrowed by a small busi-
ness investment company (within the 
meaning of section 301 of the Small 
Business Investment Act of 1958), 
and 
‘‘(II) is borrowed from, or guar-
anteed by, the Small Business Admin-
istration under the authority of sec-
tion 303(b) of such Act.’’. 
(b) CONFORMING AMENDMENTS.—Subparagraph (A) 
of section 465(b)(6) is amended— 
(1) by striking ‘‘in the case of an activity of 
holding real property,’’; and 
(2) by striking ‘‘which is secured by real prop-
erty used in such activity’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to loans and guarantees made after 
the date of the enactment of this Act. 
SEC. 523. BENEFITS UNDER THE SMALL BUSINESS BOR-
ROWER ASSISTANCE PROGRAM EXCLUDED 
FROM GROSS INCOME. 
(a) IN GENERAL.—Part III of subchapter B of chap-
ter 1 is amended by adding at the end the following new 
section: 
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‘‘SEC. 139F. BENEFITS UNDER THE SMALL BUSINESS BOR-
ROWER ASSISTANCE PROGRAM. 
‘‘(a) IN GENERAL.—Gross income shall not include 
any amount paid on behalf of a borrower by the Adminis-
trator of the Small Business Administration under the 
Small Business Borrower Assistance program established 
under section 402 of the Small Business Assistance Fund 
Act of 2010 (as in effect immediately after the date of 
the enactment of such Act). 
‘‘(b) DENIAL
OF
DOUBLE
BENEFIT.—Notwith-
standing any other provision of this subtitle, with respect 
to the person for whose benefit a payment described in 
subsection (a) is made— 
‘‘(1) INTEREST.—No deduction shall be allowed 
for interest to the extent the liability for such inter-
est is covered by such payment. 
‘‘(2) PAYMENTS OF PRINCIPAL.—If any pay-
ment is applied to reduce the principal of the loan 
to which such payment relates— 
‘‘(A) ALLOCATION AMONG FINANCED EX-
PENDITURES.—Such payment shall be allocated 
pro rata among the expenditures financed with 
such loan. 
‘‘(B) CREDITS
AND
DEDUCTIBLE
EX-
PENSES.—No deduction or credit shall be al-
lowed for, or by reason of, any such expenditure 
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to the extent of the amount of the payment al-
located to such expenditure under subparagraph 
(A). 
‘‘(C) ADJUSTMENT
OF
BASIS.—The ad-
justed basis of any property acquired with such 
expenditure shall be reduced to the extent of 
the amount of the payment allocated to such 
expenditure under subparagraph (A).’’. 
(b) CLERICAL AMENDMENTS.—The table of sections 
for part III of subchapter B of chapter 1 is amended by 
adding at the end the following new item: 
‘‘Sec. 139F. Benefits under the Small Business Borrower Assistance Pro-
gram.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to payments made after the date 
of the enactment of this Act. 
Subtitle B—Revenue Provisions 
SEC. 531. REQUIRED MINIMUM 10-YEAR TERM, ETC., FOR 
GRANTOR RETAINED ANNUITY TRUSTS. 
(a) IN GENERAL.—Subsection (b) of section 2702 is 
amended— 
(1) by redesignating paragraphs (1), (2) and 
(3) as subparagraphs (A), (B), and (C), respectively, 
and by moving such subparagraphs (as so redesig-
nated) 2 ems to the right; 
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(2) by striking ‘‘For purposes of’’ and inserting 
the following: 
‘‘(1) IN GENERAL.—For purposes of’’; 
(3) by striking ‘‘paragraph (1) or (2)’’ in para-
graph (1)(C) (as so redesignated) and inserting 
‘‘subparagraph (A) or (B)’’; and 
(4) by adding at the end the following new 
paragraph: 
‘‘(2) ADDITIONAL
REQUIREMENTS
WITH
RE-
SPECT
TO
GRANTOR
RETAINED
ANNUITIES.—For 
purposes of subsection (a), in the case of an interest 
described in paragraph (1)(A) (determined without 
regard to this paragraph) which is retained by the 
transferor, such interest shall be treated as de-
scribed in such paragraph only if— 
‘‘(A) the right to receive the fixed amounts 
referred to in such paragraph is for a term of 
not less than 10 years, 
‘‘(B) such fixed amounts, when determined 
on an annual basis, do not decrease relative to 
any prior year during the first 10 years of the 
term referred to in subparagraph (A), and 
‘‘(C) the remainder interest has a value 
greater than zero determined as of the time of 
the transfer.’’. 
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(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to transfers made after the date 
of the enactment of this Act. 
SEC. 532. CRUDE TALL OIL INELIGIBLE FOR CELLULOSIC 
BIOFUEL PRODUCER CREDIT. 
(a) IN GENERAL.—Clause (iii) of section 40(b)(6)(E) 
is amended— 
(1) by striking ‘‘or’’ at the end of subclause (I), 
(2) by striking the period at the end of sub-
clause (II) and inserting ‘‘, or’’, 
(3) by adding at the end the following new sub-
clause: 
‘‘(III) such fuel has an acid num-
ber greater than 25.’’, and 
(4) by striking ‘‘UNPROCESSED’’ in the heading 
and inserting ‘‘CERTAIN’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to fuels sold or used on or after 
January 1, 2010. 
SEC. 533. TIME FOR PAYMENT OF CORPORATE ESTIMATED 
TAXES. 
The percentage under paragraph (2) of section 561 
of the Hiring Incentives to Restore Employment Act in 
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effect on the date of the enactment of this Act is increased 
by 7.75 percentage points. 
Æ 
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