Source: http://taxtv.com/code/00232-USCODE-2011-title26-subtitleA-chap1-subchapB-partVI-sec199/
Timestamp: 2017-03-25 05:46:09
Document Index: 603266935

Matched Legal Cases: ['§199', '§199', '§199', '§102', '§403', '§4', '§401', '§401', '§312', '§502', '§746', '§2', '§502', '§502', '§502', '§401', '§312', '§401', '§4', '§4', '§4', '§403', '§403', '§403', '§403', '§403', '§403', '§403', '§403', '§403', '§403', '§403', '§403', '§403', '§403', '§746', '§401', '§312', '§401', '§4', '§199']

IRC §199. Income attributable to domestic production activities - TaxTV.com
IRC §199. Income attributable to domestic production activities
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There shall be allowed as a deduction an amount equal to 9 percent of the lesser of—
(2) Phasein
In the case of any taxable year beginning after 2004 and before 2010, paragraph (1) shall be applied by substituting for the percentage contained therein the transition percentage determined under the following table:
(2) W–2 wages
The term “W–2 wages” means, with respect to any person for any taxable year of such person, the sum of the amounts described in paragraphs (3) and (8) of section 60 (a) paid by such person with respect to employment of employees by such person during the calendar year ending during such taxable year.
(A) the taxpayer’s domestic production gross receipts for such taxable year, over
The term “domestic production gross receipts” means the gross receipts of the taxpayer which are derived from—
(I) qualifying production property which was manufactured, produced, grown, or extracted by the taxpayer in whole or in significant part within the United States,
(II) any qualified film produced by the taxpayer, or
(III) electricity, natural gas, or potable water produced by the taxpayer in the United States,
(ii) in the case of a taxpayer engaged in the active conduct of a construction trade or business, construction of real property performed in the United States by the taxpayer in the ordinary course of such trade or business, or
(iii) in the case of a taxpayer engaged in the active conduct of an engineering or architectural services trade or business, engineering or architectural services performed in the United States by the taxpayer in the ordinary course of such trade or business with respect to the construction of real property in the United States.
Such term shall not include gross receipts of the taxpayer which are derived from—
(i) the sale of food and beverages prepared by the taxpayer at a retail establishment,
(ii) the transmission or distribution of electricity, natural gas, or potable water, or
(iii) the lease, rental, license, sale, exchange, or other disposition of land.
(C) Special rule for certain Government contracts
Gross receipts derived from the manufacture or production of any property described in subparagraph (A)(i)(I) shall be treated as meeting the requirements of subparagraph (A)(i) if—
(i) such property is manufactured or produced by the taxpayer pursuant to a contract with the Federal Government, and
(ii) the Federal Acquisition Regulation requires that title or risk of loss with respect to such property be transferred to the Federal Government before the manufacture or production of such property is complete.
(5) Qualifying production property
The term “qualifying production property” means—
(A) tangible personal property,
(B) any computer software, and
(C) any property described in section 168(f)(4).
(A) Partnerships and S corporations
(ii) each partner or shareholder shall take into account such person’s allocable share of each item described in subparagraph (A) or (B) of subsection (c)(1) (determined without regard to whether the items described in such subparagraph (A) exceed the items described in such subparagraph (B)),
(iii) each partner or shareholder shall be treated for purposes of subsection (b) as having W-2 wages for the taxable year in an amount equal to such person’s allocable share of the W-2 wages of the partnership or S corporation for the taxable year (as determined under regulations prescribed by the Secretary), and
(B) Trusts and estates
(i) the items referred to in subparagraph (A)(ii) (as determined therein) and the W–2 wages of the trust or estate for the taxable year, shall be apportioned between the beneficiaries and the fiduciary (and among the beneficiaries) under regulations prescribed by the Secretary, and
(ii) for purposes of paragraph (2), adjusted gross income of the trust or estate shall be determined as provided in section 67(e) with the adjustments described in such paragraph.
(2) Application to individuals
In the case of an individual, subsections (a)(1)(B) and (d)(9)(A)(iii) shall be applied by substituting “adjusted gross income” for “taxable income”. For purposes of the preceding sentence, adjusted gross income shall be determined—
(A) after application of sections 86, 135, 137, 219, 221, 222, and 469, and
(B) without regard to this section.
(A) Deduction allowed to patrons
(ii) identified by such cooperative in a written notice mailed to such person during the payment period described in section 1382(d).
For purposes of this paragraph, the term “qualified payment” means, with respect to any person, any amount which—
(ii) is received by such person from a specified agricultural or horticultural cooperative, and
(iii) is attributable to qualified production activities income with respect to which a deduction is allowed to such cooperative under subsection (a).
(F) Specified agricultural or horticultural cooperative
For purposes of this paragraph, the term “specified agricultural or horticultural cooperative” means an organization to which part I of subchapter T applies which is engaged—
(i) by substituting “more than 50 percent” for “at least 80 percent” each place it appears, and
(6) Coordination with minimum tax
(A) qualified production activities income shall be determined without regard to any adjustments under sections 56 through 59, and
(B) in the case of a corporation, subsection (a)(1)(B) shall be applied by substituting “alternative minimum taxable income” for “taxable income”.
For purposes of determining the tax imposed by section 1, subsection (a)(1)(B) shall be applied by substituting “unrelated business taxable income” for “taxable income”.
This paragraph shall apply only with respect to the first 6 taxable years of the taxpayer beginning after December 31, 2005, and before January 1, 2012.
If a taxpayer has oil related qualified production activities income for any taxable year beginning after 2009, the amount otherwise allowable as a deduction under subsection (a) shall be reduced by 3 percent of the least of—
(i) the oil related qualified production activities income of the taxpayer for the taxable year,
(ii) the qualified production activities income of the taxpayer for the taxable year, or
(iii) taxable income (determined without regard to this section).
(Added Pub. L. 108–357, title I, §102(a), Oct. 22, 2004, 118 Stat. 1424; amended Pub. L. 109–135, title IV, §403(a)(1)–(13), Dec. 21, 2005, 119 Stat. 2615–2619; Pub. L. 109–222, title V, §4(a), (b), May 17, 2006, 120 Stat. 366; Pub. L. 109–432, div. A, title IV, §401(a), Dec. 20, 2006, 120 Stat. 2953; Pub. L. 110–343, div. B, title IV, §401(a), (b), div. C, title III, §312(a), title V, §502(c), Oct. 3, 2008, 122 Stat. 38 , 3869, 3876; Pub. L. 111–312, title VII, §746(a), Dec. 17, 2010, 124 Stat. 3319.)
Section 927(a)(2)(C) of this title, referred to in subsec. (d)(9)(C), was repealed by Pub. L. 106– 9, §2, Nov. 15, 2000, 114 Stat. 2423.
2008—Subsec. (b)(2)(D). Pub. L. 110–343, §502(c)(1), added subpar. (D).
Subsec. (c)(6). Pub. L. 110–343, §502(c)(2), inserted at end “A qualified film shall include any copyrights, trademarks, or other intangibles with respect to such film. The methods and means of distributing a qualified film shall not affect the availability of the deduction under this section.”
Subsec. (d)(1)(A)(iv). Pub. L. 110–343, §502(c)(3), added cl. (iv).
Subsec. (d)(2). Pub. L. 110–343, §401(b), substituted “subsections (a)(1)(B) and (d)(9)(A)(iii)” for “subsection (a)(1)(B)” in introductory provisions.
Subsec. (d)(8)(C). Pub. L. 110–343, §312(a), substituted “first 4 taxable years” for “first 2 taxable years” and “January 1, 2010” for “January 1, 2008”.
Subsec. (d)(9), (10). Pub. L. 110–343, §401(a), added par. (9) and redesignated former par. (9) as (10).
2006—Subsec. (a)(2). Pub. L. 109–222, §4(b)(2), struck out “and subsection (d)(1)” after “paragraph (1)”.
Subsec. (b)(2). Pub. L. 109–222, §4(a), amended par. (2) generally. Prior to amendment, text read as follows: “For purposes of this section, the term ‘W–2 wages’ means, with respect to any person for any taxable year of such person, the sum of the amounts described in paragraphs (3) and (8) of section 60 (a) paid by such person with respect to employment of employees by such person during the calendar year ending during such taxable year. Such term shall not include any amount which is not properly included in a return filed with the Social Security Administration on or before the 60th day after the due date (including extensions) for such return.”
Subsec. (d)(1)(A)(iii). Pub. L. 109–222, §4(b)(1), amended cl. (iii) generally. Prior to amendment, cl. (iii) read as follows: “each partner or shareholder shall be treated for purposes of subsection (b) as having W–2 wages for the taxable year in an amount equal to the lesser of—
2005—Subsec. (a)(2). Pub. L. 109–135, §403(a)(11)(B), substituted “subsection (d)(1)” for “subsections (d)(1) and (d)(6)”.
Subsec. (b)(1). Pub. L. 109–135, §403(a)(1), substituted “the taxpayer” for “the employer”.
Subsec. (b)(2). Pub. L. 109–135, §403(a)(2), reenacted heading without change and amended text generally. Prior to amendment, text read as follows: “For purposes of paragraph (1), the term ‘W–2 wages’ means the sum of the aggregate amounts the taxpayer is required to include on statements under paragraphs (3) and (8) of section 60 (a) with respect to employment of employees of the taxpayer during the calendar year ending during the taxpayer’s taxable year.”
Subsec. (c)(1)(B). Pub. L. 109–135, §403(a)(3), inserted “and” at end of cl. (i), added cl. (ii), and struck out former cls. (ii) and (iii) which read as follows:
Subsec. (c)(2). Pub. L. 109–135, §403(a)(4), reenacted heading without change and amended text generally. Prior to amendment, text read as follows: “The Secretary shall prescribe rules for the proper allocation of items of income, deduction, expense, and loss for purposes of determining income attributable to domestic production activities.”
Subsec. (c)(4)(A)(ii), (iii). Pub. L. 109–135, §403(a)(5), added cls. (ii) and (iii) and struck out former cls. (ii) and (iii) which read as follows:
Subsec. (c)(4)(B)(iii). Pub. L. 109–135, §403(a)(6), added cl. (iii).
Subsec. (c)(4)(C), (D). Pub. L. 109–135, §403(a)(7), added subpars. (C) and (D).
Subsec. (d)(1). Pub. L. 109–135, §403(a)(8), reenacted heading without change and amended text generally. Prior to amendment, text consisted of subpars. (A) and (B) relating to general application of section to pass-thru entities and application of wage limitation.
Subsec. (d)(3). Pub. L. 109–135, §403(a)(9), amended heading and text of par. (3) generally. Prior to amendment, text related to deductions allowed to patrons of agricultural and horticultural cooperatives.
Subsec. (d)(4)(B)(i). Pub. L. 109–135, §403(a)(10), substituted “more than 50 percent” for “50 percent” and “at least 80 percent” for “80 percent”.
Subsec. (d)(6). Pub. L. 109–135, §403(a)(11)(A), reenacted heading without change and amended text generally. Prior to amendment, text read as follows: “The deduction under this section shall be allowed for purposes of the tax imposed by section 55; except that for purposes of section 55, the deduction under subsection (a) shall be 9 percent of the lesser of—
Subsec. (d)(7). Pub. L. 109–135, §403(a)(12), added par. (7). Former par. (7) redesignated (8).
Subsec. (d)(8). Pub. L. 109–135, §403(a)(12), (13), redesignated par. (7) as (8) and inserted before period at end “, including regulations which prevent more than 1 taxpayer from being allowed a deduction under this section with respect to any activity described in subsection (c)(4)(A)(i)”.
Pub. L. 111–312, title VII, §746(b), Dec. 17, 2010, 124 Stat. 3320, provided that: “The amendments made by this section [amending this section] shall apply to taxable years beginning after December 31, 2009.”
Pub. L. 110–343, div. B, title IV, §401(c), Oct. 3, 2008, 122 Stat. 38 , provided that: “The amendments made by this section [amending this section] shall apply to taxable years beginning after December 31, 2008.”
Pub. L. 110–343, div. C, title III, §312(b), Oct. 3, 2008, 122 Stat. 3869, provided that: “The amendments made by this section [amending this section] shall apply to taxable years beginning after December 31, 2007.”
Pub. L. 109–432, div. A, title IV, §401(b), Dec. 20, 2006, 120 Stat. 2953, provided that: “The amendments made by subsection (a) [amending this section] shall apply to taxable years beginning after December 31, 2005.”
Pub. L. 109–222, title V, §4(c), May 17, 2006, 120 Stat. 367, provided that: “The amendments made by this section [amending this section] shall apply to taxable years beginning after the date of the enactment of this Act [May 17, 2006].”
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