Title: 21st Century Investment Act of 2017
Policy area: Taxation

Summary:
21st Century Investment Act of 2017
This bill amends the Internal Revenue Code to: (1) modify the tax credit for increasing research activities to allow an increased 25% tax credit rate for expenses for research, substantially all of which occurs in the United States; and (2) increase to 15%, through 2024, the tax deduction for income attributable to domestic manufacturing production activities for which substantially all of the research and development occurred in the United States.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2671 Introduced in House (IH)]

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115th CONGRESS
  1st Session
                                H. R. 2671

To amend the Internal Revenue Code of 1986 to make permanent the credit 
for increasing research activities, to increase such credit for amounts 
paid or incurred for qualified research occurring in the United States, 
 and to increase the domestic production activities deduction for the 
     manufacture of property substantially all of the research and 
          development of which occurred in the United States.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              May 25, 2017

   Mr. Brown of Maryland (for himself, Ms. Norton, Mr. Keating, Ms. 
Michelle Lujan Grisham of New Mexico, Mr. Cummings, and Mr. Cicilline) 
 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 make permanent the credit 
for increasing research activities, to increase such credit for amounts 
paid or incurred for qualified research occurring in the United States, 
 and to increase the domestic production activities deduction for the 
     manufacture of property substantially all of the research and 
          development of which occurred in the United States.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``21st Century Investment Act of 
2017''.

SEC. 2. INCREASE IN RESEARCH CREDIT FOR CONTRACTED RESEARCH WITH UNITED 
              STATES BUSINESSES.

    (a) In General.--Section 41 of the Internal Revenue Code of 1986, 
as amended by section 2 of this Act, is amended by inserting after 
subsection (h) the following new subsection:
    ``(i) Special Rule for Contracted Research With United States 
Manufacturing Business.--
            ``(1) In general.--If the taxpayer elects the application 
        of this subsection, subsection (a)(1) shall be applied by 
        substituting `25 percent' for `20 percent' with respect to 
        qualified United States research expenses.
            ``(2) Qualified united states research expenses.--For 
        purposes of this subsection, the term `qualified United States 
        research expenses' means any amount paid or incurred by the 
        taxpayer to any person (other than an employee of the taxpayer) 
        for qualified research, substantially all of which occurs in 
        the United States.
            ``(3) Separate application of section.--In the case of any 
        election of the application of this subsection, this section 
        shall be applied separately with respect to qualified United 
        States research expenses.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred for taxable years beginning after the 
date of the enactment of this Act.

SEC. 3. INCREASE IN DOMESTIC PRODUCTION ACTIVITIES DEDUCTION FOR 
              MANUFACTURED PROPERTY RESEARCHED AND DEVELOPED IN UNITED 
              STATES.

    (a) In General.--Section 199(d) of the Internal Revenue Code of 
1986 is amended by redesignating paragraph (10) as paragraph (11) and 
by inserting after paragraph (9) the following new paragraph:
            ``(10) Special rule for certain manufacturing.--
                    ``(A) In general.--In the case of qualified 
                production activities income attributable to the 
                manufacture or production of qualifying production 
                property substantially all of the research and 
                development of which occurred in the United States, 
                subsection (a) shall be applied by substituting `15 
                percent' for `9 percent'.
                    ``(B) Special rule when taxable income used to 
                determine deduction.--In the case of any taxable year 
                for which the taxpayer's qualified production 
                activities income exceeds the taxpayer's taxable income 
                (determined without regard to this section), the amount 
                of taxable income to which the 15 percent amount in 
                subparagraph (A) applies under subsection (a)(1) shall 
                be an amount equal to the amount which bears the same 
                ratio to such taxable income (as so determined) as--
                            ``(i) the amount of qualified production 
                        activities income of the taxpayer for the 
                        taxable year which is attributable to the 
                        manufacture or production of qualifying 
                        production property substantially all of the 
                        research and development with respect to which 
                        occurred in the United States, bears to
                            ``(ii) all qualified production activities 
                        income of the taxpayer for the taxable year.
                    ``(C) Termination.--This paragraph shall not apply 
                to taxable years beginning after December 31, 2024.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.
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