Q: In this task, you are given text for US Congressional and California state bills, your task is to generate a summary for this bill.
SECTION 1. SHORT TITLE.

This Act may be cited as the ''Private Sector Research and
Development Investment Act of 2001''.

SEC. 2. PERMANENT EXTENSION OF RESEARCH CREDIT.

(a) In General.--Section 41 of the Internal Revenue Code of 1986
(relating to credit for increasing research activities) is amended by
striking subsection (h).
(b) Conforming Amendment.--Section 45C(b)(1) of the Internal
Revenue Code of 1986 is amended by striking subparagraph (D).
(c) Effective Date.--The amendments made by this section shall
apply to amounts paid or incurred after the date of the enactment of
this Act.

SEC. 3. IMPROVED ALTERNATIVE INCREMENTAL CREDIT.

(a) In General.--Section 41 of the Internal Revenue Code of 1986
(relating to credit for increasing research activities), as amended by
section 2, is amended by adding at the end the following new
subsection:
''(h) Election of Alternative Incremental Credit.--
''(1) In general.--At the election of the taxpayer, the
credit under subsection (a)(1) shall be determined under this
section by taking into account the modifications provided by
this subsection.
''(2) Determination of base amount.--
''(A) In general.--In computing the base amount
under subsection (c)--
''(i) notwithstanding subsection (c)(3),
the fixed-base percentage shall be equal to 80
percent of the percentage which the aggregate
qualified research expenses of the taxpayer for
the base period is of the aggregate gross
receipts of the taxpayer for the base period,
and
''(ii) the minimum base amount under
subsection (c)(2) shall not apply.
''(B) Start-up and small taxpayers.--In computing
the base amount under subsection (c), the gross
receipts of a taxpayer for any taxable year in the base
period shall be treated as at least equal to
$1,000,000.
''(C) Base period.--For purposes of this
subsection, the base period is the 8-taxable year
period preceding the taxable year (or, if shorter, the
period the taxpayer (and any predecessor) has been in
existence).
''(3) Election.--An election under this subsection shall
apply to the taxable year for which made and all succeeding
taxable years unless revoked with the consent of the
Secretary.''
(b) Conforming Amendment.--Section 41(c) of the Internal Revenue
Code of 1986 is amended by striking paragraph (4) and by redesignating
paragraphs (5) and (6) as paragraphs (4) and (5), respectively.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2000.

SEC. 4. MODIFICATIONS TO CREDIT FOR BASIC RESEARCH.

(a) Elimination of Incremental Requirement.--
(1) In general.--Paragraph (1) of section 41(e) of the
Internal Revenue Code of 1986 (relating to credit allowable
with respect to certain payments to qualified organizations for
basic research) is amended to read as follows:
''(1) In general.--The amount of basic research payments
taken into account under subsection (a)(2) shall be determined
in accordance with this subsection.''
(2) Conforming amendments.--
(A) Section 41(a)(2) of such Code is amended by
striking ''determined under subsection (e)(1)(A)'' and
inserting ''for the taxable year''.
(B) Section 41(e) of such Code is amended by
striking paragraphs (3), (4), and (5) and by
redesignating paragraphs (6) and (7) as paragraphs (3)
and (4), respectively.
(C) Section 41(e)(4) of such Code, as redesignated
by subparagraph (B), is amended by striking
subparagraph (B) and by redesignating subparagraphs
(C), (D), and (E) as subparagraphs (B), (C), and (D),
respectively.
(D) Clause (i) of section 170(e)(4)(B) of such Code
is amended by striking ''section 41(e)(6)'' and
inserting ''section 41(e)(3)''.
(b) Basic Research.--
(1) Specific commercial objective.--Section 41(e)(4) of the
Internal Revenue Code of 1986 (relating to definitions and
special rules), as redesignated by subsection (a)(2)(B), is
amended by adding at the end the following new subparagraph:
''(E) Specific commercial objective.--For purposes
of subparagraph (A), research shall not be treated as
having a specific commercial objective if the results
of such research are to be published in a timely manner
as to be available to the general public prior to their
use for a commercial purpose.''
(2) Exclusions from basic research.--Clause (ii) of section
41(e)(4)(A) of such Code (relating to definitions and special
rules), as redesignated by subsection (a), is amended to read
as follows:
''(ii) basic research in the arts and
humanities.''
(c) Expansion of Credit to Research Done at Federal Laboratories.--
Section 41(e)(3) of the Internal Revenue Code of 1986, as redesignated
by subsection (a), is amended by adding at the end the following new
subparagraph:
''(E) Federal laboratories.--Any organization which
is a Federal laboratory (as defined in section 4(6) of
the Stevenson-Wydler Technology Innovation Act of 1980
(15 U.S.C. 3703(6)).''
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2000.

SEC. 5. CREDIT FOR EXPENSES ATTRIBUTABLE TO CERTAIN COLLABORATIVE
RESEARCH CONSORTIA.

(a) Credit for Expenses Attributable to Certain Collaborative
Research Consortia.--Subsection (a) of section 41 of the Internal
Revenue Code of 1986 (relating to credit for increasing research
activities) is amended by striking ''and'' at the end of paragraph (1),
striking the period at the end of paragraph (2) and inserting '', and
'', and by adding at the end the following new paragraph:
''(3) 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 a
qualified research consortium.''
(b) Qualified Research Consortium Defined.--Subsection (f) of
section 41 of the Internal Revenue Code of 1986 is amended by adding at
the end the following new paragraph:
''(6) Qualified research consortium.--The term 'qualified
research consortium' means any organization--
''(A) which is--
''(i) described in section 501(c)(3) and is
exempt from tax under section 501(a) and is
organized and operated primarily to conduct
scientific or engineering research, or
''(ii) organized and operated primarily to
conduct scientific or engineering research in
the public interest (within the meaning of
section 501(c)(3)),
''(B) which is not a private foundation,
''(C) to which at least 5 unrelated persons paid or
incurred during the calendar year in which the taxable
year of the organization begins amounts (including as
contributions) to such organization for scientific or
engineering research, and
''(D) to which no single person paid 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 scientific or engineering 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 (C) and as a single person for
purposes of subparagraph (D).''
(c) Conforming Amendment.--Paragraph (3) of section 41(b) of the
Internal Revenue Code of 1986 is amended by striking subparagraph (C).
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2000.

SEC. 6. IMPROVEMENT TO CREDIT FOR SMALL BUSINESSES AND RESEARCH
PARTNERSHIPS.

(a) Assistance to Small and Start-Up Businesses.--The Secretary of
the Treasury or the Secretary's delegate shall take such actions as are
appropriate to--
(1) provide assistance to small and start-up businesses in
complying with the requirements of section 41 of the Internal
Revenue Code of 1986, and
(2) reduce the costs of such compliance.
(b) Repeal of Limitation on Contract Research Expenses Paid to
Small Businesses, Universities, and Federal Laboratories.--Section
41(b)(3) of the Internal Revenue Code of 1986, as amended by section
5(c), is amended by adding at the end the following new subparagraph:
''(C) Amounts paid to eligible small businesses,
universities, and federal laboratories.--
''(i) In general.--In the case of amounts
paid by the taxpayer to an eligible small
business, an institution of higher education
(as defined in section 3304(f)), or an
organization which is a Federal laboratory (as
defined in subsection (e)(3)(E)), subparagraph
(A) shall be applied by substituting '100
percent' for '65 percent'.
''(ii) Eligible small business.--For
purposes of this subparagraph, the term
'eligible small business' means a small
business with respect to which the taxpayer
does not own (within the meaning of section
318) 50 percent or more of--
''(I) in the case of a corporation,
the outstanding stock of the
corporation (either by vote or value),
and
''(II) in the case of a small
business which is not a corporation,
the capital and profits interests of
the small business.
''(iii) Small business.--For purposes of
this subparagraph--
''(I) In general.--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.
''(II) Startups, controlled groups,
and predecessors.--Rules similar to the
rules of subparagraphs (B) and (D) of
section 220(c)(4) shall apply for
purposes of this clause.''
(c) Credit For Patent Filing Fees.--Section 41(a) of the Internal
Revenue Code of 1986, as amended by section 5(a), is amended by
striking ''and'' at the end of paragraph (2), by striking the period at
the end of paragraph (3) and inserting '', and'', and by adding at the
end the following new paragraph:
''(4) 20 percent of the patent filing fees paid or incurred
by a small business (as defined in subsection (b)(3)(C)(iii))
to the United States or to any foreign government in carrying
on any trade or business.''
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2000.
A:
Private Sector Research and Development Investment Act of 2001 - Amends the Internal Revenue Code to permanently extend and modify the research credit. Directs the Secretary of the Treasury to assist small and start-up businesses in complying with the requirements of such credit.