Instructions: In this task, you are given text for US Congressional and California state bills, your task is to generate a summary for this bill.
Input: SECTION 1. EXEMPTION FOR CERTAIN DISTRIBUTIONS OF SMALL BUSINESSES TO
EXTENT OF INCREASED WAGES.

(a) In General.--Part III of subchapter B of chapter 1 of the
Internal Revenue Code of 1986 is amended by inserting before section
140 the following new section:

''SEC. 139F. INCREASED-WAGE DISTRIBUTIONS OF SMALL BUSINESSES.

''(a) Application to Corporations.--
''(1) In general.--In the case of a distribution to an
individual from a corporation which is a small business
concern, gross income shall not include any increased-wage
exempt-dividend.
''(2) Increased-wage exempt-dividend.--For purposes of this
subsection--
''(A) In general.--The term 'increased-wage exempt-
dividend' means any dividend properly designated as an
increased-wage exempt-dividend under subparagraph (B).
''(B) Designation.--A corporation which is a small
business concern may designate any dividend paid by
such corporation as an increased-wage exempt-dividend
to the extent that the aggregate amount of the
dividends so designated for any taxable year does not
exceed the wage increase amount for such taxable year.
''(b) Application to Partnerships.--
''(1) In general.--In the case of a distribution to an
individual from a partnership which is a small business
concern--
''(A) no gain shall be recognized on any increased-
wage partnership distribution, and
''(B) in the case of an increased-wage partnership
distribution with respect to which no gain is
recognized under section 731(a)(2), no reduction shall
be made to the adjusted basis to the partner of his
interest in the partnership under section 733(1).
''(2) Increased-wage partnership distribution.--For
purposes of this subsection--
''(A) In general.--The term 'increased-wage
partnership distribution' means any cash distribution
from the partnership to a partner which is properly
designated as an increased-wage partnership
distribution under subparagraph (B).
''(B) Designation.--A partnership which is a small
business concern may designate any cash distribution as
an increased-wage partnership distribution to the
extent that the aggregate amount of the distributions
so designated for any taxable year does not exceed the
wage increase amount for such taxable year.
''(c) Wage Increase Amount.--For purposes of this section--
''(1) In general.--The term 'wage increase amount' means,
with respect to any corporation or partnership for any taxable
year, the sum of--
''(A) the excess (if any) of--
''(i) the aggregate qualified wages paid or
incurred by the corporation or partnership for
such taxable year, over
''(ii) the aggregate qualified wages paid
or incurred by the corporation or partnership
for the preceding taxable year, plus
''(B) any increased-wage exempt-dividends or
increased-wage partnership distributions received by
such corporation or partnership during such taxable
year.
''(2) Qualified wages.--The term 'qualified wages' has the
meaning which would be given such term by section 3121(a) if
paragraph (1) thereof were applied by treating the contribution
and benefit base as being equal to $50,000.
''(3) Aggregation rule.--All persons treated as a single
employer under subsection (a) or (b) of section 52 shall be
treated as one person for purposes of this subsection.
''(4) Treatment of predecessors.--Any reference in this
subsection to a corporation or partnership shall include a
reference to any predecessor of such corporation or
partnership.
''(d) Small Business Concern.--For purposes of this section, the
term 'small business concern' has the meaning given such term by
section 3 of the Small Business Act.''.
(b) Conforming Amendments.--
(1) Section 1(h)(11)(B)(ii) of such Code is amended by
striking ''and'' at the end of subclause (II), by striking the
period at the end of subclause (III) and inserting '', and'',
and by adding at the end the following new subclause:
''(IV) any increased-wage exempt-
dividend (as defined in section
139F).''.
(2) The table of sections for part III of subchapter B of
chapter 1 of such Code is amended by inserting before the item
relating to section 140 the following new item:

''Sec. 139F. Increased-wage distributions.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2012.
Output:
Amends the Internal Revenue Code to exclude from gross income increased-wage exempt-dividends distributed to an individual by a corporation or a partnership which is a small business concern (as defined by the Small Business Act). Defines "increased-wage exempt-dividends" as dividends paid by a small business concern that do not exceed the increase in wages paid by the small business concern over wages paid in the preceding taxable year.