I
106TH CONGRESS
1ST SESSION
H. R. 2308
To amend the Internal Revenue Code of 1986 to expand the deduction
for computer donations to schools and public libraries and to allow
a tax credit for donated computers.
IN THE HOUSE OF REPRESENTATIVES
JUNE 22, 1999
Mr. PORTMAN (for himself, Mr. BECERRA, Mr. CUNNINGHAM, Mr. MATSUI,
Mr. ARMEY, Mr. WATTS of Oklahoma, Mr. TANNER, Mr. JEFFERSON,
Mr. KUYKENDALL, Mrs. THURMAN, Mr. FROST, Mr. FLETCHER, Mr.
MOAKLEY, Mr. FARR of California, Mr. SHAYS, Mr. LATHAM, Mr.
CUMMINGS, Ms. LEE, Mr. BILBRAY, Mr. SHOWS, Mr. REYES, Mrs.
KELLY, Mrs. CHRISTENSEN, Mr. FILNER, Mr. PITTS, Mr. DOOLEY of
California, Mr. SCOTT, Mr. PICKERING, Ms. LOFGREN, Ms. SANCHEZ,
Mr. COOK, Mrs. NAPOLITANO, Mr. GREEN of Texas, Mr. MCINTOSH, Ms.
MILLENDER-MCDONALD, Ms. CARSON, Mrs. MORELLA, Mr. MORAN of
Virginia, Mr. NADLER, Mr. PASTOR, Mr. KILDEE, Mr. HORN, Mr. KEN-
NEDY of Rhode Island, and Mr. HINCHEY) 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 expand
the deduction for computer donations to schools and
public libraries and to allow a tax credit for donated
computers.
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 ‘‘New Millennium Class-
rooms Act’’.
SEC. 2. EXPANSION OF DEDUCTION FOR COMPUTER DONA-
TIONS TO SCHOOLS AND PUBLIC LIBRARIES.
(a) EXPANSION OF COMPUTER DONATIONS TO PUB-
LIC LIBRARIES.—
(1) IN
GENERAL.—Paragraph (6) of section
170(e) of the Internal Revenue Code of 1986 (relat-
ing to special rule for contributions of computer
technology and equipment for elementary or sec-
ondary school purposes) is amended by striking
‘‘qualified elementary or secondary educational con-
tribution’’ each place it occurs in the headings and
text and inserting ‘‘qualified computer contribution’’.
(2) QUALIFIED COMPUTER CONTRIBUTION DE-
FINED.—Subclause (II) of section 170(e)(6)(B)(i) of
such Code (relating to qualified elementary or sec-
ondary educational contribution) is amended by
striking ‘‘or’’ at the end of subclause (I), by insert-
ing ‘‘or’’ at the end of subclause (II), and by insert-
ing after subclause (II) the following new subclause:
‘‘(III) a public library (within the
meaning of section 213(2)(A) of the
Library Services and Technology Act
(20 U.S.C. 9122(2)(A)), as in effect
on the date of the enactment of the
New Millennium Classrooms Act, es-
tablished and maintained by an entity
described in subsection (c)(1).’’.
(3) CONFORMING AMENDMENT.—The heading
of paragraph (6) of section 170(e) of such Code is
amended by striking ‘‘ELEMENTARY OR SECONDARY
SCHOOL PURPOSES’’ and inserting ‘‘SCHOOL AND LI-
BRARY PURPOSES’’.
(b) EXTENSION
OF
AGE
OF
ELIGIBLE
COM-
PUTERS.—Clause (ii) of section 170(e)(6)(B) of such Code
(defining qualified elementary or secondary educational
contribution) is amended—
(1) by striking ‘‘2 years’’ and inserting ‘‘3
years’’, and
(2) by striking ‘‘date’’ the first place it appears
and all that follows and inserting the following:
‘‘date—
‘‘(I) the taxpayer acquired or re-
acquired the property,
‘‘(II) construction of the property
is substantially completed in the case
of property constructed by the tax-
payer for its own use in its trade or
business and which is not inventory
with respect to the taxpayer, or
‘‘(III) the property was originally
sold, leased, or otherwise disposed of
by the taxpayer in the case of prop-
erty reacquired by the taxpayer.’’.
(c) REACQUIRED COMPUTERS ELIGIBLE FOR DONA-
TION.—Clause (iii) of section 170(e)(6)(B) of such Code
(defining qualified elementary or secondary educational
contribution) is amended by inserting ‘‘, the person from
whom the donor reacquires the property,’’ after ‘‘the
donor’’.
(d) EFFECTIVE DATE.—The amendments made by
this section shall apply to contributions made in taxable
years ending after the date of the enactment of this Act.
SEC. 3. CREDIT FOR COMPUTER DONATIONS TO SCHOOLS
AND PUBLIC LIBRARIES.
(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:
‘‘SEC. 
45D. 
CREDIT 
FOR 
COMPUTER 
DONATIONS 
TO
SCHOOLS AND PUBLIC LIBRARIES.
‘‘(a) GENERAL RULE.—For purposes of section 38,
the school and public library computer donation credit de-
termined under this section is an amount equal to 30 per-
cent of the qualified computer contributions made by the
taxpayer during the taxable year.
‘‘(b) INCREASED PERCENTAGE FOR CONTRIBUTIONS
TO SCHOOLS OR PUBLIC LIBRARIES IN EMPOWERMENT
ZONES, ENTERPRISE COMMUNITIES, AND INDIAN RES-
ERVATIONS.—In the case of a qualified computer con-
tribution to an educational organization, public library, or
entity located in an empowerment zone or enterprise com-
munity designated under section 1391 or an Indian res-
ervation (as defined in section 168(j)(6)), subsection (a)
shall be applied by substituting ‘50 percent’ for ‘30 per-
cent’.
‘‘(c) LIMITATION.—No credit shall be allowed under
subsection (a) for the contribution of a computer (as de-
fined in section 168(i)(2)(B)(ii)) if the computer software
(as defined in section 197(e)(3)(B)) that serves as the op-
erating system of such computer has not been lawfully in-
stalled.
‘‘(d) QUALIFIED COMPUTER CONTRIBUTION.—For
purposes of this section, the term ‘qualified computer con-
tribution’ has the meaning given such term by section
170(e)(6)(B).
‘‘(e) CERTAIN RULES MADE APPLICABLE.—For pur-
poses of this section, rules similar to the rules of para-
graphs (1) and (2) of section 41(f) shall apply.
‘‘(f) TERMINATION.—This section shall not apply to
taxable years beginning on or after the date which is 3
years after the date of the enactment of the New Millen-
nium Classrooms Act.’’
(b) CURRENT YEAR BUSINESS CREDIT CALCULA-
TION.—Section 38(b) of such Code (relating to current
year business credit) is amended by striking ‘‘plus’’ at the
end of paragraph (11), by striking the period at the end
of paragraph (12) and inserting ‘‘, plus’’, and by adding
at the end the following:
‘‘(13) the school and public library computer
donation credit determined under section 45D(a).’’.
(c) DISALLOWANCE OF DEDUCTION BY AMOUNT OF
CREDIT.—Section 280C of such Code (relating to certain
expenses for which credits are allowable) is amended by
adding at the end the following:
‘‘(d) CREDIT FOR SCHOOL AND PUBLIC LIBRARY
COMPUTER DONATIONS.—No deduction shall be allowed
for that portion of the qualified computer contributions
(as defined in section 170(e)(6)(B)) made during the tax-
able year that is equal to the amount of credit determined
for the taxable year under section 45D(a). In the case of
a corporation which is a member of a controlled group of
corporations (within the meaning of section 52(a)) or a
trade or business which is treated as being under common
control with other trades or businesses (within the mean-
ing of section 52(b)), this subsection shall be applied
under rules prescribed by the Secretary similar to the
rules applicable under subsections (a) and (b) of section
52.’’
(d) LIMITATION ON CARRYBACK.—Subsection (d) of
section 39 of such Code (relating to carryback and
carryforward of unused credits) is amended by adding at
the end the following:
‘‘(9) NO CARRYBACK OF SCHOOL AND PUBLIC
LIBRARY COMPUTER DONATION CREDIT BEFORE EF-
FECTIVE
DATE.—No amount of unused business
credit available under section 45D may be carried
back to a taxable year beginning on or before the
date of the enactment of this paragraph.’’.
(e) CLERICAL AMENDMENT.—The table of sections
for subpart D of part IV of subchapter A of chapter 1
of such Code is amended by inserting after the item relat-
ing to section 45C the following:
‘‘Sec. 45D. Credit for computer donations to schools and public
libraries.’’
(f) EFFECTIVE DATE.—The amendments made by
this section shall apply to contributions made in taxable
years beginning after the date of the enactment of this
Act.
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