Title: Supermarket Tax Credit for Underserved Areas Act
Policy area: Taxation

Summary:
Supermarket Tax Credit for Underserved Areas Act
This bill expands the tax credits that are available for the establishment of supermarkets in underserved areas (i.e., any enterprise community or empowerment zone and any renewal community). The bill includes provisions that (1) increase the rate of the rehabilitation tax credit for a supermarket building placed in service after December 31, 2019, and before January 1, 2022, in an underserved area; (2) increase by $1,000 the limit on wages eligible for the work opportunity tax credit for employees of a new supermarket located in an underserved area; and (3) allow a business-related tax credit for 15% of the gross receipts from the retail sale of locally grown fresh fruits and vegetables in a new supermarket in an underserved area.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3123 Introduced in House (IH)]

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116th CONGRESS
  1st Session
                                H. R. 3123

 To amend the Internal Revenue Code of 1986 to provide tax incentives 
  for the establishment of supermarkets in certain underserved areas.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                              June 5, 2019

    Mr. Cohen (for himself, Ms. Norton, Ms. Clarke of New York, Mr. 
Grijalva, Mr. Raskin, Ms. Lee of California, Ms. Kelly of Illinois, Mr. 
 Rush, Ms. Schakowsky, and Mr. Khanna) 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 the establishment of supermarkets in certain underserved areas.

    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 ``Supermarket Tax Credit for 
Underserved Areas Act''.

SEC. 2. TAX INCENTIVES FOR ESTABLISHMENT OF SUPERMARKETS IN CERTAIN 
              UNDERSERVED AREAS.

    (a) In General.--Subchapter Y of chapter 1 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new part:

    ``PART IV--TAX INCENTIVES FOR SUPERMARKETS IN UNDERSERVED AREAS

``Sec. 1400V-1. Increased rehabilitation credit.
``Sec. 1400V-2. Increased work opportunity tax credit.
``Sec. 1400V-3. Credit for sales of locally grown fresh fruits and 
                            vegetables.
``Sec. 1400V-4. Definitions.

``SEC. 1400V-1. INCREASED REHABILITATION CREDIT.

    ``(a) In General.--In the case of a qualified rehabilitated 
building (as defined in section 47) which is an underserved area 
supermarket, subsection (a) of section 47 shall be applied--
            ``(1) by substituting `12 percent' for `10 percent' in 
        paragraph (1), and
            ``(2) by substituting `24 percent' for `20 percent' in 
        paragraph (2).
    ``(b) Underserved Area Supermarket.--For purposes of subsection 
(a), a qualified rehabilitated building shall be treated as meeting the 
requirements of subparagraphs (A), (B), (C), and (D) of section 1400V-
4(a)(2) if it is reasonable to believe that such building will meet 
such requirements as of the close of the taxable year in which such 
building is placed in service.
    ``(c) Termination.--Subsection (a) shall only apply to buildings 
placed in service after December 31, 2019, and before January 1, 2022.

``SEC. 1400V-2. INCREASED WORK OPPORTUNITY TAX CREDIT.

    ``(a) In General.--In the case of an individual employed in the 
trade or business of operating a new underserved area supermarket, the 
limitation otherwise in effect under paragraph (3) of section 51(b) 
with respect to such individual shall be increased by $1,000.
    ``(b) Termination.--Subsection (a) shall only apply to wages paid 
in taxable years beginning after December 31, 2019, and before January 
1, 2025.

``SEC. 1400V-3. CREDIT FOR SALES OF LOCALLY GROWN FRESH FRUITS AND 
              VEGETABLES.

    ``(a) In General.--For purposes of section 38, the underserved area 
supermarket fruit and vegetable credit determined under this section 
for the taxable year is 15 percent of the gross receipts from the 
retail sale of locally grown fresh fruits and vegetables in the trade 
or business of operating a new underserved area supermarket.
    ``(b) Termination.--Subsection (a) shall only apply to taxable 
years beginning after December 31, 2020, and before January 1, 2025.

``SEC. 1400V-4. DEFINITIONS.

    ``For purposes of this part--
            ``(1) Underserved area supermarket.--The term `underserved 
        area supermarket' means any supermarket located in an 
        underserved area.
            ``(2) New underserved area supermarket.--The term `new 
        underserved area supermarket' means any underserved area 
        supermarket which--
                    ``(A) is placed in service after December 31, 2019, 
                and
                    ``(B) was not a supermarket at any time during the 
                3-year period ending on the date such underserved area 
                supermarket is placed in service.
            ``(3) Supermarket.--The term `supermarket' means any 
        building if--
                    ``(A) not less than 12,000 square feet and not more 
                than 80,000 square feet of such building is used for 
                selling items at retail,
                    ``(B) at least 7 percent of the square feet of such 
                building which is used for selling items at retail is 
                used for selling produce, meat, fish, deli, and dairy 
                items,
                    ``(C) gross sales of items sold at retail from such 
                building exceed $2,000,000 annually, and
                    ``(D) at least 7 percent of such gross sales are 
                attributable to sales of produce, meat, fish, deli, and 
                dairy items.
            ``(4) Underserved area.--The term `underserved area' 
        means--
                    ``(A) any enterprise community or empowerment zone 
                with respect to which a designation was in effect under 
                section 1391 on December 31, 2014, and
                    ``(B) any renewal community with respect to which a 
                designation was in effect under section 1400E on 
                December 31, 2009.''.
    (b) Credit To Be Part of General Business Credit.--Section 38(b) of 
such Code is amended by striking ``plus'' at the end of paragraph (31), 
by striking the period at the end of paragraph (32) and inserting ``, 
plus'', and by adding at the end the following new paragraph:
            ``(33) the underserved area supermarket fruit and vegetable 
        credit determined under section 1400V-3.''.
    (c) Clerical Amendment.--The table of parts for subchapter Y of 
chapter 1 of such Code is amended by adding at the end the following 
new item:

   ``Part IV. Tax Incentives for Supermarkets in Underserved Areas''.

    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2019.
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