erning board of the entity or on any advisory board 
to the entity, and 
‘‘(3) the entity is certified by the Secretary for 
purposes of this section as being a qualified research 
entity. 
‘‘(d) QUALIFIED
RESEARCH
INVESTMENTS.—For 
purposes of this section— 
‘‘(1) IN
GENERAL.—The term ‘qualified re-
search investment’ means— 
‘‘(A) any capital or equity investment in, 
or loan to, any qualifying small business inno-
vation company, which when added to any other 
such investment in or loan to such company 
taken into account for purposes of this section 
for 
any 
taxable 
year 
does 
not 
exceed 
$10,000,000, and 
‘‘(B) the purchase from another qualified 
research entity of any loan made by such entity 
which is a qualified research investment. 
‘‘(2) QUALIFYING
SMALL
BUSINESS
INNOVA-
TION COMPANY.— 
‘‘(A) IN GENERAL.—For purposes of para-
graph (1), the term ‘qualifying small business 
innovation company’ means, with respect to any 
taxable year, any corporation (including a non-
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profit corporation) or partnership if for such 
year— 
‘‘(i) the gross receipts of such entity 
do not exceed $10,000,000, 
‘‘(ii) the aggregate gross assets of 
such entity do not exceed $25,000,000, 
and 
‘‘(iii) at least 50 percent of the gross 
expenditures of such entity would qualify 
as research or experimental expenditures 
under section 174. 
All persons treated as a single employer under 
subsection (a) or (b) of section 52 or subsection 
(m) or (o) of section 414 shall be treated as one 
person for purposes of this subparagraph. 
‘‘(B) AGGREGATE
GROSS
ASSETS.—For 
purposes of subparagraph (A)(ii), the term ‘ag-
gregate gross assets’ shall have meaning given 
such term by section 1202(d)(2), except such 
term shall not include intangibles and goodwill. 
‘‘(e) NATIONAL LIMITATION ON AMOUNT OF INVEST-
MENTS DESIGNATED.— 
‘‘(1) IN GENERAL.—There is a research invest-
ment tax credit limitation for each calendar year. 
Such limitation is— 
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‘‘(A) $500,000,000 for 2007, 
‘‘(B) $750,000,000 for 2008 and 2009, 
and 
‘‘(C) $1,000,000,000 for 2010 and 2011. 
‘‘(2) ALLOCATION OF LIMITATION.—The limita-
tion under paragraph (1) shall be allocated by the 
Secretary among qualified research entities selected 
by the Secretary, with not more than $25,000,000 
allocated to any 1 qualified research entity in any 
calendar year. In making allocations under the pre-
ceding sentence, the Secretary shall give priority to 
any entity— 
‘‘(A) with a record of having successfully 
provided capital or technical assistance to quali-
fying small business innovation companies, or 
‘‘(B) which intends to satisfy the require-
ment under subsection (b)(1)(B) by making 
qualified research investments in 1 or more 
companies in which persons unrelated to such 
entity (within the meaning of section 267(b) or 
707(b)(1)) hold the majority equity interest, 
and 
if more than 1 qualified research entity meets sub-
paragraph (A) or (B), the Secretary shall give pri-
ority to the entity with the earliest investment. If in-
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sufficient allocations are available for all qualified 
applicants in any calendar year, the priorities estab-
lished for such applicants without allocations shall 
be carried over to the succeeding calendar year. 
‘‘(3) CARRYOVER OF UNUSED LIMITATION.—If 
the research investment tax credit limitation for any 
calendar year exceeds the aggregate amount allo-
cated under paragraph (2) for such year, such limi-
tation for the succeeding calendar year shall be in-
creased by the amount of such excess. No amount 
may be carried under the preceding sentence to any 
calendar year after 2018. 
‘‘(f) RECAPTURE OF CREDIT IN CERTAIN CASES.— 
‘‘(1) IN GENERAL.—If, at any time during the 
7-year period beginning on the date of the original 
issue of a qualified equity investment in a qualified 
research entity, there is a recapture event with re-
spect to such investment, then the tax imposed by 
this chapter for the taxable year in which such event 
occurs shall be increased by the credit recapture 
amount. 
‘‘(2) CREDIT RECAPTURE AMOUNT.—For pur-
poses of paragraph (1), the credit recapture amount 
is an amount equal to the sum of— 
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