Source: https://www.law.cornell.edu/uscode/text/26/41
Timestamp: 2019-04-25 15:56:47+00:00

Document:
20 percent of the amounts paid or incurred by the taxpayer in carrying on any trade or business of the taxpayer during the taxable year (including as contributions) to an energy research consortium for energy research.
Clause (iii) shall not apply to any amount to the extent that the taxpayer (or any person with whom the taxpayer must aggregate expenditures under subsection (f)(1)) receives or accrues any amount from any other person for the right to use substantially identical personal property.
engaging in the direct supervision or direct support of research activities which constitute qualified research.
If substantially all of the services performed by an individual for the taxpayer during the taxable year consists of services meeting the requirements of clause (i) or (ii), the term “qualified services” means all of the services performed by such individual for the taxpayer during the taxable year.
property of a character subject to the allowance for depreciation.
The term “wages” has the meaning given such term by section 3401(a).
In the case of an employee (within the meaning of section 401(c)(1)), the term “wages” includes the earned income (as defined in section 401(c)(2)) of such employee.
The term “wages” shall not include any amount taken into account in determining the work opportunity credit under section 51(a).
The term “contract research expenses” means 65 percent of any amount paid or incurred by the taxpayer to any person (other than an employee of the taxpayer) for qualified research.
Subparagraph (A) shall be applied by substituting “75 percent” for “65 percent” with respect to amounts paid or incurred by the taxpayer to a qualified research consortium for qualified research on behalf of the taxpayer and 1 or more unrelated taxpayers. For purposes of the preceding sentence, all persons treated as a single employer under subsection (a) or (b) of section 52 shall be treated as related taxpayers.
is not a private foundation.
for qualified research which is energy research, subparagraph (A) shall be applied by substituting “100 percent” for “65 percent”.
in the case of a small business which is not a corporation, the capital and profits interests of the small business.
The term “small business” means, with respect to any calendar year, any person if the annual average number of employees employed by such person during either of the 2 preceding calendar years was 500 or fewer. For purposes of the preceding sentence, a preceding calendar year may be taken into account only if the person was in existence throughout the year.
Rules similar to the rules of subparagraphs (B) and (D) of section 220(c)(4) shall apply for purposes of this clause.
For purposes of this subparagraph, the term “Federal laboratory” has the meaning given such term by section 4(6) of the Stevenson-Wydler Technology Innovation Act of 1980 (15 U.S.C. 3703(6)), as in effect on the date of the enactment of the Energy Tax Incentives Act of 2005.
of 1 or more other persons who with the taxpayer are treated as a single taxpayer under subsection (f)(1).
the average annual gross receipts of the taxpayer for the 4 taxable years preceding the taxable year for which the credit is being determined (hereinafter in this subsection referred to as the “credit year”).
there are fewer than 3 taxable years beginning after December 31, 1983, and before January 1, 1989, in which the taxpayer had both gross receipts and qualified research expenses.
for taxable years thereafter, the percentage which the aggregate qualified research expenses for any 5 taxable years selected by the taxpayer from among the 5th through the 10th such taxable years is of the aggregate gross receipts of the taxpayer for such selected years.
The Secretary may prescribe regulations providing that de minimis amounts of gross receipts and qualified research expenses shall be disregarded under clauses (i) and (ii).
The percentages determined under subparagraphs (A) and (B)(ii) shall be rounded to the nearest 1/100th of 1 percent.
At the election of the taxpayer, the credit determined under subsection (a)(1) shall be equal to 14 percent of so much of the qualified research expenses for the taxable year as exceeds 50 percent of the average qualified research expenses for the 3 taxable years preceding the taxable year for which the credit is being determined.
The credit under this paragraph shall be determined under this subparagraph if the taxpayer has no qualified research expenses in any one of the 3 taxable years preceding the taxable year for which the credit is being determined.
The credit determined under this subparagraph shall be equal to 6 percent of the qualified research expenses for the taxable year.
The Secretary may prescribe regulations to prevent distortions in calculating a taxpayer’s qualified research expenses or gross receipts caused by a change in accounting methods used by such taxpayer between the current year and a year taken into account in computing such taxpayer’s fixed-base percentage.
For purposes of this subsection, gross receipts for any taxable year shall be reduced by returns and allowances made during the taxable year. In the case of a foreign corporation, there shall be taken into account only gross receipts which are effectively connected with the conduct of a trade or business within the United States, the Commonwealth of Puerto Rico, or any possession of the United States.
substantially all of the activities of which constitute elements of a process of experimentation for a purpose described in paragraph (3).
used by the taxpayer in a trade or business of the taxpayer.
Any research related to the adaptation of an existing business component to a particular customer’s requirement or need.
routine or ordinary testing or inspection for quality control.
a production process with respect to which the requirements of paragraph (1) are met.
that portion of such basic research payments which does not exceed the qualified organization base period amount shall be treated as contract research expenses for purposes of subsection (a)(1).
such basic research is to be performed by such qualified organization.
the amounts treated as contract research expenses during the base period by reason of this subsection (as in effect during the base period).
the amount of nondesignated university contributions paid by the taxpayer during such taxable year.
as a basic research payment for purposes of this section.
The cost-of-living adjustment for any calendar year is the cost-of-living adjustment for such calendar year determined under section 1(f)(3), by substituting “calendar year 1987” for “calendar year 2016” in subparagraph (A)(ii) thereof.
If the base period of any taxpayer does not end in 1983 or 1984, section 1(f)(3)(A)(ii) shall, for purposes of this paragraph, be applied by substituting the calendar year in which such base period ends for 2016. Such substitution shall be in lieu of the substitution under clause (i).
is described in section 170(b)(1)(A)(ii).
for grants to, or contracts for basic research with, an organization described in subparagraph (A).
makes an election, revocable only with the consent of the Secretary, to be treated as a private foundation for purposes of this title (other than section 4940, relating to excise tax based on investment income).
basic research in the social sciences, arts, or humanities.
The term “base period” means the 3-taxable-year period ending with the taxable year immediately preceding the 1st taxable year of the taxpayer beginning after December 31, 1983.
shall not be included in the computation of base amount under subsection (a)(1)(B).
the credit (if any) allowable by this section to each such member shall be determined on a proportionate basis to its share of the aggregate of the qualified research expenses, basic research payments, and amounts paid or incurred to energy research consortiums, taken into account by such controlled group for purposes of this section.
the credit (if any) allowable by this section to each such person shall be determined on a proportionate basis to its share of the aggregate of the qualified research expenses, basic research payments, and amounts paid or incurred to energy research consortiums, taken into account by all such persons under common control for purposes of this section.
If a person acquires the major portion of either a trade or business or a separate unit of a trade or business (hereinafter in this paragraph referred to as the “acquired business”) of another person (hereinafter in this paragraph referred to as the “predecessor”), then the amount of qualified research expenses paid or incurred by the acquiring person during the measurement period shall be increased by the amount determined under clause (ii), and the gross receipts of the acquiring person for such period shall be increased by the amount determined under clause (iii).
for purposes of applying this section for any taxable year after the taxable year in which such acquisition is made, the qualified research expenses paid or incurred by the predecessor with respect to the acquired business during the measurement period.
The amount determined under this clause is the amount which would be determined under clause (ii) if “the gross receipts of” were substituted for “the qualified research expenses paid or incurred by” each place it appears in clauses (ii) and (iv).
divided by the number of days in the acquiring person’s taxable year.
the amount of such gross receipts taken into account under clause (iii) with respect to a taxable year of the acquiring person shall be equal to the total of the gross receipts attributable under subclause (II) to the days occurring during such taxable year.
For purposes of this subparagraph, the term “measurement period” means, with respect to the taxable year of the acquiring person for which the credit is determined, any period of the acquiring person preceding such taxable year which is taken into account for purposes of determining the credit for such year.
in the case of any taxable year ending after the taxable year in which such disposition is made, the amount described in clause (i)(I).
the product of the number of taxable years so taken into account, multiplied by the amount of the reimbursement described in this subparagraph.
the determination shall be made without regard to subsections (a)(4) and (e)(3)(C) of section 1563.
to which no single personpaid or incurred (including as contributions) during such calendar year an amount equal to more than 50 percent of the total amounts received by such organization during such calendar year for energy research.
All persons treated as a single employer under subsection (a) or (b) of section 52 shall be treated as related persons for purposes of subparagraph (A)(iii) and as a single person for purposes of subparagraph (A)(iv).
The term “energy research” does not include any research which is not qualified research.
the amount determined under subsection (a) for any taxable year shall not exceed an amount (separately computed with respect to such person’s interest in such trade or business or entity) equal to the amount of tax attributable to that portion of a person’s taxable income which is allocable or apportionable to the person’s interest in such trade or business or entity. If the amount determined under subsection (a) for any taxable year exceeds the limitation of the preceding sentence, such amount may be carried to other taxable years under the rules of section 39; except that the limitation of the preceding sentence shall be taken into account in lieu of the limitation of section 38(c) in applying section 39.
At the election of a qualified small business for any taxable year, section 3111(f) shall apply to the payroll tax credit portion of the credit otherwise determined under subsection (a) for the taxable year and such portion shall not be treated (other than for purposes of section 280C) as a credit determined under subsection (a).
in the case of a qualified small business other than a partnership or S corporation, the amount of the business credit carryforward under section 39 carried from the taxable year (determined before the application of this subsection to the taxable year).
by only taking into account the aggregate gross receipts received by such person in carrying on all trades or businesses of such person.
Such term shall not include an organization which is exempt from taxation under section 501.
may be revoked only with the consent of the Secretary.
The amount specified in any election made under this subsection shall not exceed $250,000.
A person may not make an election under this subsection if such person (or any other person treated as a single taxpayer with such person under paragraph (5)(A)) has made an election under this subsection for 5 or more preceding taxable years.
In the case of a qualified small business which is a partnership or S corporation, the election made under this subsection shall be made at the entity level.
Except as provided in subparagraph (B), all persons or entities treated as a single taxpayer under subsection (f)(1) shall be treated as a single taxpayer for purposes of this subsection.
the $250,000 amount under paragraph (4)(B)(i) shall be allocated among all persons treated as a single taxpayer under subparagraph (A) in the same manner as under subparagraph (A)(ii) or (B)(ii) of subsection (f)(1), whichever is applicable.
regulations for recapturing the benefit of credits determined under section 3111(f) in cases where there is a subsequent adjustment to the payroll tax credit portion of the credit determined under subsection (a), including requiring amended income tax returns in the cases where there is such an adjustment.
The date of the enactment of the Energy Tax Incentives Act of 2005, referred to in subsec. (b)(3)(D)(iv), is the date of enactment of title XIII of Pub. L. 109–58, which was approved Aug. 8, 2005.
A prior section 41, added Pub. L. 97–34, title III, § 331(a), Aug. 13, 1981, 95 Stat. 289, § 44G; amended Pub. L. 97–448, title I, § 103(g)(1), Jan. 12, 1983, 96 Stat. 2379; renumbered § 41 and amended Pub. L. 98–369, div. A, title I, § 14, title IV, §§ 471(c), 474(l), 491(e)(2), (3), July 18, 1984, 98 Stat. 505, 826, 833, 852, 853, related to employee stock ownership credit, prior to repeal by Pub. L. 99–514, title XI, § 1171(a), Oct. 22, 1986, 100 Stat. 2513, applicable to compensation paid or accrued after Dec. 31, 1986, in taxable years ending after such date, except as otherwise provided, see section 1171(c) of Pub. L. 99–514, set out as an Effective Date of 1986 Amendment note under section 38 of this title. For transition rules relating to such repeal, see section 1177 of Pub. L. 99–514, set out as a Transition Rules note under section 38 of this title.
Another prior section 41 was renumbered section 24 of this title.
2018—Subsec. (c)(4). Pub. L. 115–141, § 101(c)(1), (2), redesignated par. (5) as (4) and struck out former par. (4) which related to election of alternative incremental credit.
Subsec. (c)(4)(A). Pub. L. 115–141, § 401(b)(6), struck out “(12 percent in the case of taxable years ending before January 1, 2009)” after “14 percent”.
Subsec. (c)(5) to (7). Pub. L. 115–141, § 101(c)(2), redesignated pars. (5) to (7) as (4) to (6), respectively.
2017—Subsec. (d)(1)(A). Pub. L. 115–97, § 13206(d)(1), substituted “specified research or experimental expenditures under section 174” for “expenses under section 174”.
Subsec. (e)(5)(C)(i). Pub. L. 115–97, § 11002(d)(1)(F), substituted “for ‘calendar year 2016’ in subparagraph (A)(ii)” for “for ‘calendar year 1992’ in subparagraph (B)”.
Subsec. (e)(5)(C)(ii). Pub. L. 115–97, § 11002(d)(2), substituted “1(f)(3)(A)(ii)” for “1(f)(3)(B)” and “2016” for “1992”.
2015—Subsec. (h). Pub. L. 114–113, § 121(c)(1), added subsec. (h).
Pub. L. 114–113, § 121(a)(1), struck out subsec. (h) which provided the termination date for applicability of this section and the alternative incremental credit and provided the computation for taxable year in which credit terminates.
2013—Subsec. (f)(1)(A)(ii). Pub. L. 112–240, § 301(c)(1), substituted “shall be determined on a proportionate basis to its share of the aggregate of the qualified research expenses, basic research payments, and amounts paid or incurred to energy research consortiums, taken into account by such controlled group for purposes of this section” for “shall be its proportionate shares of the qualified research expenses, basic research payments, and amounts paid or incurred to energy research consortiums, giving rise to the credit”.
Subsec. (f)(1)(B)(ii). Pub. L. 112–240, § 301(c)(2), substituted “shall be determined on a proportionate basis to its share of the aggregate of the qualified research expenses, basic research payments, and amounts paid or incurred to energy research consortiums, taken into account by all such persons under common control for purposes of this section” for “shall be its proportionate shares of the qualified research expenses, basic research payments, and amounts paid or incurred to energy research consortiums, giving rise to the credit”.
Subsec. (h)(1)(B). Pub. L. 112–240, § 301(a)(1), substituted “December 31, 2013” for “December 31, 2011”.
2010—Subsec. (h)(1)(B). Pub. L. 111–312 substituted “December 31, 2011” for “December 31, 2009”.
2008—Subsec. (c)(5)(A). Pub. L. 110–343, § 301(c), substituted “14 percent (12 percent in the case of taxable years ending before January 1, 2009)” for “12 percent”.
Subsec. (h)(1)(B). Pub. L. 110–343, § 301(a)(1), substituted “December 31, 2009” for “December 31, 2007”.
Subsec. (h)(2). Pub. L. 110–343, § 301(d), redesignated par. (3) as (2) related to computation for taxable year in which credit terminates.
Pub. L. 110–343, § 301(b), added par. (2). Former par. (2) redesignated (3).
Pub. L. 110–343, § 301(b), redesignated par. (2) as (3).
2007—Subsec. (a)(3). Pub. L. 110–172, § 6(c)(1), inserted “for energy research” before period at end.
Subsec. (f)(1)(A)(ii), (B)(ii). Pub. L. 110–172, § 11(e)(2), substituted “qualified research expenses, basic research payments, and amounts paid or incurred to energy research consortiums,” for “qualified research expenses and basic research payments”.
Subsec. (f)(6)(E). Pub. L. 110–172, § 6(c)(2), added subpar. (E).
2006—Subsec. (c)(4)(A)(i). Pub. L. 109–432, § 104(b)(1)(A), substituted “3 percent” for “2.65 percent”.
Subsec. (c)(4)(A)(ii). Pub. L. 109–432, § 104(b)(1)(B), substituted “4 percent” for “3.2 percent”.
Subsec. (c)(4)(A)(iii). Pub. L. 109–432, § 104(b)(1)(C), substituted “5 percent” for “3.75 percent”.
Subsec. (c)(5) to (7). Pub. L. 109–432, § 104(c)(1), added par. (5) and redesignated former pars. (5) and (6) as (6) and (7), respectively.
Subsec. (h)(1)(B). Pub. L. 109–432, § 104(a)(1), substituted “2007” for “2005”.
2005—Subsec. (a)(3). Pub. L. 109–58, § 1351(a)(1), added par. (3).
Subsec. (b)(3)(C)(ii). Pub. L. 109–135, § 402(l)(2), struck out “(other than an energy research consortium)” after “organization” in introductory provisions.
Pub. L. 109–58, § 1351(a)(3), inserted “(other than an energy research consortium)” after “organization” in introductory provisions.
Subsec. (b)(3)(D). Pub. L. 109–58, § 1351(b), added subpar. (D).
Subsec. (f)(6). Pub. L. 109–58, § 1351(a)(2), added par. (6).
Subsec. (f)(6)(C), (D). Pub. L. 109–135, § 402(l)(1), added subpars. (C) and (D).
2004—Subsec. (h)(1)(B). Pub. L. 108–311 substituted “December 31, 2005” for “June 30, 2004”.
1999—Subsec. (c)(4)(A)(i). Pub. L. 106–170, § 502(b)(1)(A), substituted “2.65 percent” for “1.65 percent”.
Subsec. (c)(4)(A)(ii). Pub. L. 106–170, § 502(b)(1)(B), substituted “3.2 percent” for “2.2 percent”.
Subsec. (c)(4)(A)(iii). Pub. L. 106–170, § 502(b)(1)(C), substituted “3.75 percent” for “2.75 percent”.
Subsecs. (c)(6), (d)(4)(F). Pub. L. 106–170, § 502(c)(1), inserted “, the Commonwealth of Puerto Rico, or any possession of the United States” before period at end.
Subsec. (h)(1)(B). Pub. L. 106–170, § 502(a)(1)(A), substituted “June 30, 2004” for “June 30, 1999”.
1998—Subsec. (h)(1). Pub. L. 105–277 substituted “June 30, 1999” for “June 30, 1998” in subpar. (B) and substituted “36-month” for “24-month” and “36 months” for “24 months” in concluding provisions.
Subsec. (h)(1). Pub. L. 105–34, § 601(a), substituted “June 30, 1998” for “May 31, 1997” in subpar. (B) and “during the 24-month period beginning with the first month of such year. The 24 months referred to in the preceding sentence shall be reduced by the number of full months after June 1996 (and before the first month of such first taxable year) during which the taxpayer paid or incurred any amount which is taken into account in determining the credit under this section.” for “during the first 11 months of such taxable year.” in concluding provisions.
1996—Subsec. (b)(2)(D)(iii). Pub. L. 104–188, § 1201(e)(1), (4), substituted “work opportunity credit” for “targeted jobs credit” in heading and text.
Subsec. (b)(3)(C). Pub. L. 104–188, § 1204(d), added subpar. (C).
Subsec. (c)(4) to (6). Pub. L. 104–188, § 1204(c), added par. (4) and redesignated former pars. (4) and (5) as (5) and (6), respectively.
“(1) In general.—This section shall not apply to any amount paid or incurred after June 30, 1995.
Subsec. (c)(3)(B)(iii). Pub. L. 103–66, § 13112(b)(1), substituted “clauses (i) and (ii)” for “clause (i)”.
Subsec. (c)(3)(D). Pub. L. 103–66, § 13112(b)(2), substituted “subparagraphs (A) and (B)(ii)” for “subparagraph (A)”.
Subsec. (e)(5)(C). Pub. L. 103–66, § 13201(b)(3)(C), substituted “1992” for “1989” in cls. (i) and (ii).
Subsec. (h). Pub. L. 103–66, § 13111(a)(1), substituted “June 30, 1995” for “June 30, 1992” in pars. (1) and (2) and “July 1, 1995” for “July 1, 1992” in two places in par. (2).
1991—Subsec. (h). Pub. L. 102–227 substituted “June 30, 1992” for “December 31, 1991” in pars. (1) and (2), and “July 1, 1992” for “January 1, 1992” in two places in par. (2).
1990—Subsec. (e)(5)(C)(i). Pub. L. 101–508, § 11101(d)(1)(C)(i), inserted before period at end “, by substituting ‘calendar year 1987’ for ‘calendar year 1989’ in subparagraph (B) thereof”.
Subsec. (h). Pub. L. 101–508, § 11402(a), substituted “December 31, 1991” for “December 31, 1990” wherever appearing and “January 1, 1992” for “January 1, 1991” wherever appearing.
1989—Subsec. (a)(1)(B). Pub. L. 101–239, § 7110(b)(2)(A), amended subpar. (B) generally. Prior to amendment, subpar. (B) read as follows: “the base period research expenses, and”.
Subsec. (b)(4). Pub. L. 101–239, § 7110(b)[(c)], added par. (4).
Subsec. (c). Pub. L. 101–239, § 7110(b)(1), substituted “Base amount” for “Base period research expenses” in heading and amended text generally, substituting pars. (1) to (5) for former pars. (1) to (3) which defined “base period research expenses” and “base period” and prescribed minimum base period research expenses.
Subsec. (e)(7)(C)(ii). Pub. L. 101–239, § 7110(b)(2)(B), substituted “base amount” for “base period research expenses”.
Subsec. (f)(1). Pub. L. 101–239, § 7110(b)(2)(C), substituted “proportionate shares of the qualified research expenses and basic research payments” for “proportionate share of the increase in qualified research expenses” in subpars. (A)(ii) and (B)(ii).
Subsec. (f)(3)(A). Pub. L. 101–239, § 7110(b)(2)(D), substituted “December 31, 1983” for “June 30, 1980” and inserted before period at end “, and the gross receipts of the taxpayer for such periods shall be increased by so much of the gross receipts of such predecessor with respect to the acquired trade or business as is attributable to such portion”.
Subsec. (f)(3)(B). Pub. L. 101–239, § 7110(b)(2)(E), substituted “December 31, 1983” for “June 30, 1980” in introductory provisions and inserted before period at end “, and the gross receipts of the taxpayer for such periods shall be decreased by so much of the gross receipts as is attributable to such portion”.
Subsec. (f)(4). Pub. L. 101–239, § 7110(b)(2)(G), inserted “and gross receipts” after “qualified research expenses”.
Subsec. (h). Pub. L. 101–239, § 7814(e)(2)(C), redesignated subsec. (i) as (h) and struck out former subsec. (h) which related to election, time for election, and manner of election by taxpayer to have research credit not apply for a taxable year.
Subsec. (h)(1). Pub. L. 101–239, § 7110(a)(1)(A), substituted “December 31, 1990” for “December 31, 1989”.
Subsec. (h)(2). Pub. L. 101–239, § 7110(a)(1), substituted “January 1, 1991” for “January 1, 1990” in two places and substituted “December 31, 1990” for “December 31, 1989”.
Pub. L. 101–239, § 7110(b)(2)(H), substituted “base amount” for “base period expenses” in heading and “the base amount with respect to such taxable year shall be the amount which bears the same ratio to the base amount for such year (determined without regard to this paragraph)” for “any amount for any base period with respect to such taxable year shall be the amount which bears the same ratio to such amount for such base period” in text.
Subsec. (i). Pub. L. 101–239, § 7814(e)(2)(C), redesignated subsec. (i) as (h).
Subsec. (h). Pub. L. 100–647, § 4008(b)(1), added subsec. (h). Former subsec. (h) redesignated (i).
Subsec. (i). Pub. L. 100–647, § 4008(b)(1), redesignated former subsec. (h) as (i).
Pub. L. 100–647, § 4007(a), substituted “1989” and “1990” for “1988” and “1989”, respectively, wherever appearing in subsec. (h), prior to redesignation as subsec. (i) by Pub. L. 100–647, § 4008(b)(1).
1986—Pub. L. 99–514, § 231(d)(2), renumbered section 30 of this title as this section.
Subsec. (b)(2)(D)(iii). Pub. L. 99–514, § 1847(b)(1), substituted “targeted jobs credit” for “new jobs or WIN credit” in heading.
Subsec. (e). Pub. L. 99–514, § 231(c)(2), amended subsec. (e) generally, substituting “Credit allowable with respect to certain payments to qualified organizations for basic research” for “Credit available with respect to certain basic research by colleges, universities, and certain research organizations” in heading, and restating and expanding provisions of former pars. (1) to (4) into new pars. (1) to (7).
Subsec. (g). Pub. L. 99–514, § 231(d)(3)(C)(ii), amended subsec. (g) generally, substituting provisions relating to special rule for pass-thru of credit for provisions relating to limitation on amount of credit for research based on amount of tax liability.
Subsec. (h). Pub. L. 99–514, § 231(a)(1), added subsec. (h).
1984—Pub. L. 98–369, § 471(c), renumbered section 44F of this title as this section.
Subsec. (b)(2)(D)(iii). Pub. L. 98–369, § 474(i)(1)(A), substituted “in determining the targeted jobs credit under section 51(a)” for “in computing the credit under section 40 or 44B”.
Subsec. (g)(1)(A). Pub. L. 98–369, § 612(e)(1), substituted “section 26(b)” for “section 25(b)”.
Pub. L. 98–369, § 474(i)(1)(B), amended subpar. (A) generally, substituting “shall not exceed the taxpayer’s tax liability for the taxable year (as defined in section 25(b)), reduced by the sum of the credits allowable under subpart A and sections 27, 28, and 29” for “shall not exceed the amount of the tax imposed by this chapter reduced by the sum of the credits allowable under a section of this part having a lower number or letter designation than this section, other than the credits allowable by sections 31, 39, and 43. For purposes of the preceding sentence, the term ‘tax imposed by this chapter’ shall not include any tax treated as not imposed by this chapter under the last sentence of section 53(a)”.
1983—Subsec. (b)(2)(A). Pub. L. 97–448 inserted provision that cl. (iii) would not apply to any amount to the extent that the taxpayer (or any person with whom the taxpayer must aggregate expenditures under subsection (f)(1)) received or accrued any amount from any other person for the right to use substantially identical personal property.
1982—Subsec. (f)(2)(A). Pub. L. 97–354, § 5(a)(3)(A), substituted “Pass-thru in the case of estates and trusts” for “Pass-through in the case of subchapter S corporations, etc.” in subpar. heading, and substituted provisions relating to the applicability of rules similar to rules of subsec. (d) of section 52 for provisions relating to the applicability of rules similar to rules of subsecs. (d) and (e) of section 52.
Subsec. (g)(1)(B)(iv). Pub. L. 97–354, § 5(a)(3)(B), substituted “an S corporation” for “an electing small business corporation (within the meaning of section 1371(b))”.
Amendment by section 101(c)(3) of Pub. L. 115–141 effective as if included in the provision of the Protecting Americans from Tax Hikes Act of 2015, div. Q of Pub. L. 114–113, to which such amendment relates, see section 101(s) of Pub. L. 115–141, set out as a note under section 24 of this title.
Amendment by section 11002(d)(1)(F), (2) of Pub. L. 115–97 applicable to taxable years beginning after Dec. 31, 2017, see section 11002(e) of Pub. L. 115–97, set out as a note under section 1 of this title.
Amendment by section 121(a)(1) of Pub. L. 114–113 applicable to amounts paid or incurred after Dec. 31, 2014, see section 121(d)(1) of Pub. L. 114–113, set out as a note under section 38 of this title.
Amendment by section 121(c)(1) of Pub. L. 114–113 applicable to taxable years beginning after Dec. 31, 2015, see section 121(d)(3) of Pub. L. 114–113, set out as a note under section 38 of this title.
The amendments made by subsection (a) [amending this section and section 45C of this title] shall apply to amounts paid or incurred after December 31, 2011.
Except as provided in paragraph (2), the amendments made by this section [amending this section and section 45C of this title] shall apply to taxable years beginning after December 31, 2007.
Amendment by section 6(c) of Pub. L. 110–172 effective as if included in the provisions of the Energy Policy Act of 2005, Pub. L. 109–58, to which such amendment relates, see section 6(e) of Pub. L. 110–172, set out as a note under section 30C of this title.
Except as provided in paragraph (3), the amendments made by this subsection [amending this section] shall apply to taxable years ending after December 31, 2006.
the applicable 2007 percentage multiplied by the amount determined under section 41(c)(4)(A) of such Code (as in effect for taxable years ending on January 1, 2007).
The term ‘specified transitional taxable year’ means any taxable year which ends after December 31, 2006, and which includes such date.
The term ‘applicable 2006 percentage’ means the number of days in the specified transitional taxable year before January 1, 2007, divided by the number of days in such taxable year.
In the case of an election under section 41(c)(4) of the Internal Revenue Code of 1986 which applies to the taxable year which includes January 1, 2007, such election shall be treated as revoked with the consent of the Secretary of the Treasury if the taxpayer makes an election under section 41(c)(5) of such Code (as added by this subsection) for such year.
Except as provided in paragraph (4), the amendments made by this subsection [amending this section] shall apply to taxable years ending after December 31, 2006.
the applicable 2007 percentage multiplied by the amount determined under section 41(c)(5) of such Code (as in effect for taxable years ending on January 1, 2007).
Terms used in this paragraph which are also used in subsection (b)(3) [set out above] shall have the respective meanings given such terms in such subsection.
Elections under paragraphs (4) and (5) of section 41(c) of such Code may both apply for the specified transitional taxable year.
Amendment by Pub. L. 109–135 effective as if included in the provision of the Energy Policy Act of 2005, Pub. L. 109–58, to which such amendment relates, see section 402(m)(1) of Pub. L. 109–135, set out as an Effective and Termination Dates of 2005 Amendments note under section 23 of this title.
Amendment by section 1201(e)(1), (4) of Pub. L. 104–188 applicable to individuals who begin work for the employer after Sept. 30, 1996, see section 1201(g) of Pub. L. 104–188, set out as a note under section 38 of this title.
Except as provided in paragraph (2), the amendments made by this section [amending this section and section 28 [now 45C] of this title] shall apply to taxable years ending after June 30, 1996.
The amendments made by subsections (c) and (d) [amending this section] shall apply to taxable years beginning after June 30, 1996.
Amendment by section 13111(a)(1) of Pub. L. 103–66 applicable to taxable years ending after June 30, 1992, see section 13111(c) of Pub. L. 103–66, set out as a note under section 45C of this title.
Amendment by section 13201(b)(3)(C) of Pub. L. 103–66 applicable to taxable years beginning after Dec. 31, 1992, see section 13201(c) of Pub. L. 103–66, set out as a note under section 1 of this title.
Amendment by Pub. L. 102–227 applicable to taxable years ending after Dec. 31, 1991, see section 102(c) of Pub. L. 102–227, set out as a note under section 45C of this title.
Amendment by section 11101(d)(1)(C) of Pub. L. 101–508 applicable to taxable years beginning after Dec. 31, 1990, see section 11101(e) of Pub. L. 101–508, set out as a note under section 1 of this title.
Amendment by section 11402(a) of Pub. L. 101–508 applicable to taxable years beginning after Dec. 31, 1989, see section 11402(c) of Pub. L. 101–508, set out as a note under section 45C of this title.
Amendment by section 7814(e)(2)(C) of Pub. L. 101–239 effective, except as otherwise provided, as if included in the provision of the Technical and Miscellaneous Revenue Act of 1988, Pub. L. 100–647, to which such amendment relates, see section 7817 of Pub. L. 101–239, set out as a note under section 1 of this title.
Amendment by section 1002(h)(1) of Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title.
Except as provided in this subsection (2), the amendments made by this section [amending this section and sections 28, 38, 39, 108, 170, 280C, 381, 936, 6411, and 6511 of this title, renumbering former section 30 of this title as this section, and enacting and amending provisions set out as notes under this section] shall apply to taxable years beginning after December 31, 1985.
The amendments made by subsection (a) [amending this section and provisions set out as a note under this section] shall apply to taxable years ending after December 31, 1985.
Amendment by section 1847(b)(1) of Pub. L. 99–514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98–369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99–514, set out as a note under section 48 of this title.
Amendment by section 474(i)(1) of Pub. L. 98–369 applicable to taxable years beginning after Dec. 31, 1983, and to carrybacks from such years, see section 475(a) of Pub. L. 98–369, set out as a note under section 21 of this title.
Amendment by section 612(e)(1) of Pub. L. 98–369 applicable to interest paid or accrued after Dec. 31, 1984, on indebtedness incurred after Dec. 31, 1984, see section 612(g) of Pub. L. 98–369, set out as an Effective Date note under section 25 of this title.
Pub. L. 97–448, title I, § 102(h)(2), Jan. 12, 1983, 96 Stat. 2372, provided that the amendment made by that section is effective only with respect to amounts paid or incurred after March 31, 1982.
The amendments made by this section [enacting this section and amending sections 55, 381, 383, 6096, 6411, and 6511 of this title] shall apply to amounts paid or incurred after June 30, 1981.
If, with respect to the first taxable year to which the amendments made by this section apply and which ends in 1981 or 1982, the taxpayer may only take into account qualified research expenses paid or incurred during a portion of such taxable year, the amount of the qualified research expenses taken into account for the base period of such taxable year shall be the amount which bears the same ratio to the total qualified research expenses for such base period as the number of months in such portion of such taxable year bears to the total number of months in such taxable year.
For provisions that nothing in amendment by section 401(b)(6) of Pub. L. 115–141 be construed to affect treatment of certain transactions occurring, property acquired, or items of income, loss, deduction, or credit taken into account prior to Mar. 23, 2018, for purposes of determining liability for tax for periods ending after Mar. 23, 2018, see section 401(e) of Pub. L. 115–141, set out as a note under section 23 of this title.
In the case of any taxable year ending after December 31, 2005, and before the date of the enactment of this Act [Dec. 20, 2006], any election under section 41(c)(4) or section 280C(c)(3)(C) [now 280C(c)(2)(C)] of the Internal Revenue Code of 1986 shall be treated as having been timely made for such taxable year if such election is made not later than the later of April 15, 2007, or such time as the Secretary of the Treasury, or his designee, may specify. Such election shall be made in the manner prescribed by such Secretary or designee.
shall not be taken into account prior to October 1, 2001, to the extent such credit is attributable to the second suspension period.
On or after the earliest date that an amount of credit may be taken into account, such amount may be taken into account through the filing of an amended return, an application for expedited refund, an adjustment of estimated taxes, or other means allowed by such Code.
the second suspension period is the period beginning on October 1, 2000, and ending on September 30, 2001.
If there is an overpayment of tax with respect to a taxable year by reason of paragraph (1), the taxpayer may file an application for a tentative refund of such overpayment. Such application shall be in such manner and form, and contain such information, as the Secretary may prescribe.
Subparagraph (A) shall apply only to an application filed before the date which is 1 year after the close of the suspension period to which the application relates.
in a manner similar to the manner provided in section 6411(b) of such Code.
The provisions of section 6411(c) of such Code shall apply to an adjustment under this paragraph in such manner as the Secretary may provide.
For purposes of this subsection, in the case of a taxable year which includes a portion of the suspension period, the amount of credit determined under section 41 of such Code for such taxable year which is attributable to such period is the amount which bears the same ratio to the amount of credit determined under such section 41 for such taxable year as the number of months in the suspension period which are during such taxable year bears to the number of months in such taxable year.
No addition to tax shall be made under section 6654 or 6655 of such Code for any period before July 1, 1999, with respect to any underpayment of tax imposed by such Code to the extent such underpayment was created or increased by reason of subparagraph (A).
Pub. L. 101–239, title VII, § 7110(a)(2), Dec. 19, 1989, 103 Stat. 2323, which set forth the method of determining the amount treated as qualified research expenses for taxable years beginning before Oct. 1, 1990, and ending after Sept. 30, 1990, was repealed by Pub. L. 101–508, title XI, § 11402(b)(1), Nov. 5, 1990, 104 Stat. 1388–473.
Pub. L. 100–647, title IV, § 4007(b), Nov. 10, 1988, 102 Stat. 3652, directed Comptroller General of United States to conduct a study of credit provided by 26 U.S.C. 41 and submit a report of the study not later than Dec. 31, 1989, to Committee on Ways and Means of House of Representatives and Committee on Finance of Senate.
 Amendment of Subsection (d)(1)(A) note below.

References: § 331
 § 44
 § 103
 § 41
 § 14
 § 1171
 § 101
 § 401
 § 101
 § 13206
 § 11002
 § 11002
 § 121
 § 121
 § 301
 § 301
 § 301
 § 301
 § 301
 § 301
 § 301
 § 301
 § 6
 § 11
 § 6
 § 104
 § 104
 § 104
 § 104
 § 104
 § 1351
 § 402
 § 1351
 § 1351
 § 1351
 § 402
 § 502
 § 502
 § 502
 § 502
 § 502
 § 601
 § 1201
 § 1204
 § 1204
 § 13112
 § 13112
 § 13201
 § 13111
 § 11101
 § 11402
 § 7110
 § 7110
 § 7110
 § 7110
 § 7110
 § 7110
 § 7110
 § 7110
 § 7814
 § 7110
 § 7110
 § 7110
 § 7814
 § 4008
 § 4008
 § 4007
 § 4008
 § 231
 § 1847
 § 231
 § 231
 § 231
 § 471
 § 474
 § 612
 § 474
 § 5
 § 5
 § 102
 § 7110
 § 11402
 § 4007