‘‘(1) IN GENERAL.—This section shall apply to 
property— 
‘‘(A) which is— 
‘‘(i) tangible property (to which sec-
tion 168 applies), or 
‘‘(ii) computer software (as defined in 
section 197(e)(3)(B)) which is described in 
section 197(e)(3)(A)(i), to which section 
167 applies, 
‘‘(B) which is section 1245 property (as 
defined in section 1245(a)(3)) or 1250 property 
(as defined in section 1250(c)), and 
‘‘(C) which is acquired by purchase for use 
in the active conduct of a trade or business. 
Such term shall not include any property described 
in section 50(b) and shall not include air condi-
tioning or heating units. 
‘‘(2) PURCHASE
DEFINED.—For purposes of 
paragraph (1), the term ‘purchase’ means any acqui-
sition of property, but only if— 
‘‘(A) the property is not acquired from a 
person whose relationship to the person acquir-
ing it would result in the disallowance of losses 
under section 267 or 707(b) (but, in applying 
section 267(b) and (c) for purposes of this sec-
VerDate Nov 24 2008 
02:27 Apr 17, 2010
Jkt 089200
PO 00000
Frm 00010
Fmt 6652
Sfmt 6201
E:\BILLS\H5029.IH
H5029
pwalker on DSK8KYBLC1PROD with BILLS
tion, paragraph (4) of section 267(c) shall be 
treated as providing that the family of an indi-
vidual shall include only his spouse, ancestors, 
and lineal descendants), 
‘‘(B) the property is not acquired by one 
component member of a controlled group from 
another component member of the same con-
trolled group, and 
‘‘(C) the basis of the property in the hands 
of the person acquiring it is not determined— 
‘‘(i) in whole or in part by reference 
to the adjusted basis of such property in 
the hands of the person from whom ac-
quired, or 
‘‘(ii) under section 1014(a) (relating 
to property acquired from a decedent). 
‘‘(3) COST.—For purposes of this section, the 
cost of property does not include so much of the 
basis of such property as is determined by reference 
to the basis of other property held at any time by 
the person acquiring such property. 
‘‘(4) CONTROLLED GROUP DEFINED.—For pur-
poses of this section, the term ‘controlled group’ has 
the meaning assigned to it by section 1563(a), ex-
cept that, for such purposes, the phrase ‘more than 
VerDate Nov 24 2008 
02:27 Apr 17, 2010
Jkt 089200
PO 00000
Frm 00011
Fmt 6652
Sfmt 6201
E:\BILLS\H5029.IH
H5029
pwalker on DSK8KYBLC1PROD with BILLS
50 percent’ shall be substituted for the phrase ‘at 
least 80 percent’ each place it appears in section 
1563(a)(1). 
‘‘(5) COORDINATION
WITH
SECTION
38.—No 
credit shall be allowed under section 38 with respect 
to any amount for which a deduction is allowed 
under subsection (a). 
‘‘(6) RECAPTURE
IN
CERTAIN
CASES.—The 
Secretary shall, by regulations, provide for recap-
turing the benefit under any deduction allowable 
under subsection (a) with respect to any property 
which is not used predominantly in a trade or busi-
ness at any time. 
‘‘(c) ELECTION.— 
‘‘(1) IN GENERAL.—An election under this sec-
tion for any taxable year shall— 
‘‘(A) specify the items of property to which 
the election applies, and 
‘‘(B) be made on the taxpayer’s return of 
the tax imposed by this chapter for the taxable 
year. 
Such election shall be made in such manner as the 
Secretary may by regulations prescribe. 
‘‘(2) ELECTION
IRREVOCABLE.—Any election 
made under this section, and any specification con-
VerDate Nov 24 2008 
02:27 Apr 17, 2010
Jkt 089200
PO 00000
Frm 00012
Fmt 6652
Sfmt 6201
E:\BILLS\H5029.IH
H5029
pwalker on DSK8KYBLC1PROD with BILLS
tained in any such election, may not be revoked ex-
cept with the consent of the Secretary.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to property placed in service after 
the date of the enactment of this Act. 
SEC. 6. PAYROLL TAX DECREASE FOR 2010. 
(a) EMPLOYEES.—Section 3101 of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following new subsection: 
‘‘(d) REDUCTION IN TAX RATE FOR 2010.—In the 
case of wages received during calendar year 2010— 
‘‘(1) subsection (a) shall be applied by sub-
stituting ‘3.1 percent’ for ‘6.2 percent’ in the table 
contained therein, and 
‘‘(2) subsection (b) shall be applied by sub-
stituting ‘0.725 percent’ for ‘1.45 percent’ in para-
graph (6) thereof.’’. 
(b) EMPLOYERS.—Section 3111 of such Code is 
amended by adding at the end the following new sub-
section: 
‘‘(d) REDUCTION IN TAX RATE FOR 2010.—In the 
case of wages paid during calendar year 2010— 
‘‘(1) subsection (a) shall be applied by sub-
stituting ‘3.1 percent’ for ‘6.2 percent’ in the table 
contained therein, and 
VerDate Nov 24 2008 
02:27 Apr 17, 2010
Jkt 089200
PO 00000
Frm 00013
Fmt 6652
Sfmt 6201
E:\BILLS\H5029.IH
H5029
pwalker on DSK8KYBLC1PROD with BILLS