TASK DEFINITION: In this task, you are given text for US Congressional and California state bills, your task is to generate a summary for this bill.
PROBLEM: 16, 110th Congress, agreed
to in the Senate March 1, 2007, and House Concurrent Resolution 80,
110th Congress, agreed to in the House of Representatives June 18,
2007.
SEC. 4. REQUIREMENT OF A STRATEGY TO SUPPORT THE DISARMAMENT OF THE
LORD'S RESISTANCE ARMY.
(a) Requirement for Strategy.--Not later than 180 days after the
date of the enactment of this Act, the President shall develop and
submit to the appropriate committees of Congress a strategy to guide
future United States support across the region for viable multilateral
efforts to mitigate and eliminate the threat to civilians and regional
stability posed by the Lord's Resistance Army.
(b) Content of Strategy.--The strategy shall include the following:
(1) A plan to help strengthen efforts by the United Nations and
regional governments to protect civilians from attacks by the
Lord's Resistance Army while supporting the development of
institutions in affected areas that can help to maintain the rule
of law and prevent conflict in the long term.
(2) An assessment of viable options through which the United
States, working with regional governments, could help develop and
support multilateral efforts to eliminate the threat posed by the
Lord's Resistance Army.
(3) An interagency framework to plan, coordinate, and review
diplomatic, economic, intelligence, and military elements of United
States policy across the region regarding the Lord's Resistance
Army.
(4) A description of the type and form of diplomatic engagement
across the region undertaken to coordinate and implement United
States policy regarding the Lord's Resistance Army and to work
multilaterally with regional mechanisms, including the Tripartite
Plus Commission and the Great Lakes Pact.
(5) A description of how this engagement will fit within the
context of broader efforts and policy objectives in the Great Lakes
Region.
(c) Form.--The strategy under this section shall be submitted in
unclassified form, but may include a classified annex.
SEC. 5. HUMANITARIAN ASSISTANCE FOR AREAS OUTSIDE UGANDA AFFECTED BY
THE LORD'S RESISTANCE ARMY.
In accordance with section 491 of the Foreign Assistance Act of
1961 (22 U.S.C. 2292) and section 2 of the Migration and Refugee
Assistance Act of 1962 (22 U.S.C. 2601), the President is authorized to
provide additional assistance to the Democratic Republic of Congo,
southern Sudan, and Central African Republic to respond to the
humanitarian needs of populations directly affected by the activity of
the Lord's Resistance Army.
SEC. 6. ASSISTANCE FOR RECOVERY AND RECONSTRUCTION IN NORTHERN UGANDA.
(a) Authority.--It is the sense of Congress that the President
should support efforts by the people of northern Uganda and the
Government of Uganda--
(1) to assist internally displaced people in transition and
returnees to secure durable solutions by spurring economic
revitalization, supporting livelihoods, helping to alleviate
poverty, and advancing access to basic services at return sites,
specifically clean water, health care, and schools;
(2) to enhance the accountability and administrative competency
of local governance institutions and public agencies in northern
Uganda with regard to budget management, provision of public goods
and services, and related oversight functions;
(3) to strengthen the operational capacity of the civilian
police in northern Uganda to enhance public safety, prevent crime,
and deal sensitively with gender-based violence, while
strengthening accountability measures to prevent corruption and
abuses;
(4) to rebuild and improve the capacity of the justice system
in northern Uganda, including the courts and penal systems, with
particular sensitivity to the needs and rights of women and
children;
(5) to establish mechanisms for the disarmament,
demobilization, and reintegration of former combatants and those
abducted by the LRA, including vocational education and employment
opportunities, with attention given to the roles and needs of men,
women and children; and
(6) to promote programs to address psychosocial trauma,
particularly post-traumatic stress disorder.
(b) Future Year Funding.--It is the sense of Congress that the
Secretary of State and Administrator of the United States Agency for
International Development should work with the appropriate committees
of Congress to increase assistance in future fiscal years to support
activities described in this section if the Government of Uganda
demonstrates a commitment to transparent and accountable reconstruction
in war-affected areas of northern Uganda, specifically by--
(1) finalizing the establishment of mechanisms within the
Office of the Prime Minister to sufficiently manage and coordinate
the programs under the framework of the Peace Recovery and
Development Plan for Northern Uganda (PRDP);
(2) increasing oversight activities and reporting, at the local
and national level in Uganda, to ensure funds under the Peace
Recovery and Development Plan for Northern Uganda framework are
used efficiently and with minimal waste; and
(3) committing substantial funds of its own, above and beyond
standard budget allocations to local governments, to the task of
implementing the Peace Recovery and Development Plan for Northern
Uganda such that communities affected by the war can recover.
(c) Coordination With Other Donor Nations.--The United States
should work with other donor nations to increase contributions for
recovery efforts in northern Uganda and better leverage those
contributions to enhance the capacity and encourage the leadership of
the Government of Uganda in promoting transparent and accountable
reconstruction in northern Uganda.
(d) Termination of Assistance.--It is the sense of Congress that
the Secretary of State should withhold non-humanitarian bilateral
assistance to the Republic of Uganda if the Secretary determines that
the Government of Uganda is not committed to reconstruction and
reconciliation in the war-affected areas of northern Uganda and is not
taking proactive steps to ensure this process moves forward in a
transparent and accountable manner.
SEC. 7. ASSISTANCE FOR RECONCILIATION AND TRANSITIONAL JUSTICE IN
NORTHERN UGANDA.
(a) Sense of Congress.--It is the sense of Congress that, despite
reconstruction and development efforts, a continued failure to take
meaningful steps toward national reconciliation and accountability
risks perpetuating longstanding political grievances and fueling new
conflicts.
(b) Authority.--In accordance with section 531 of the Foreign
Assistance Act of 1961 (22 U.S.C. 2346), the President is authorized to
support efforts by the people of northern Uganda and the Government of
Uganda to advance efforts to promote transitional justice and
reconciliation on both local and national levels, including to
encourage implementation of the mechanisms outlined in the Annexure to
the Agreement on Accountability and Reconciliation between the
Government of Uganda and the Lord's Resistance Army/Movement, signed at
Juba February 19, 2008, namely--
(1) a body to investigate the history of the conflict, inquire
into human rights violations committed during the conflict by all
sides, promote truth-telling in communities, and encourage the
preservation of the memory of events and victims of the conflict
through memorials, archives, commemorations, and other forms of
preservation;
(2) a special division of the High Court of Uganda to try
individuals alleged to have committed serious crimes during the
conflict, and a special unit to carry out investigations and
prosecutions in support of trials;
(3) a system for making reparations to victims of the conflict;
and
(4) a review and strategy for supporting transitional justice
mechanisms in affected areas to promote reconciliation and
encourage individuals to take personal responsibility for their
conduct during the war.
SEC. 8. REPORT.
(a) Report Required.--Not later than 1 year after the submission of
the strategy required under section 4, the Secretary of State shall
prepare and submit to the appropriate committees of Congress a report
on the progress made toward the implementation of the strategy required
under section 4 and a description and evaluation of the assistance
provided under this Act toward the policy objectives described in
section 3.
(b) Contents.--The report required under section (a) shall
include--
(1) a description and evaluation of actions taken toward the
implementation of the strategy required under section 4;
(2) a description of assistance provided under sections 5, 6,
and 7;
(3) an evaluation of bilateral assistance provided to the
Republic of Uganda and associated programs in light of stated
policy objectives;
(4) a description of the status of the Peace Recovery and
Development Plan for Northern Uganda and the progress of the
Government of Uganda in fulfilling the steps outlined in section
6(b); and
(5) a description of amounts of assistance committed, and
amounts provided, to northern Uganda during the reporting period by
the Government of Uganda and each donor country.
(c) Form.--The report under this section shall be submitted in
unclassified form, but may include a classified annex.
SEC. 9. SENSE OF CONGRESS ON FUNDING.
It is the sense of Congress that--
(1) of the total amounts to be appropriated for fiscal year
2011 for the Department of State and foreign operations, up to
$10,000,000 should be used to carry out activities under section 5;
and
(2) of the total amounts to be appropriated for fiscal year
2011 through 2013 for the Department of State and foreign
operations, up to $10,000,000 in each such fiscal year should be
used to carry out activities under section 7.
SEC. 10. DEFINITIONS.
In this Act:
(1) Appropriate committees of congress.--The term ''appropriate
committees of Congress'' means the Committee on Appropriations and
the Committee on Foreign Relations of the Senate and the Committee
on Appropriations and the Committee on Foreign Affairs of the House
of Representatives.
(2) Great lakes region.--The term ''Great Lakes Region'' means
the region comprising Burundi, Democratic Republic of Congo,
Rwanda, southern Sudan, and Uganda.
(3) LRA-affected areas.--The term ''LRA-affected areas'' means
those portions of northern Uganda, southern Sudan, northeastern
Democratic Republic of Congo, and southeastern Central African
Republic determined by the Secretary of State to be affected by the
Lord's Resistance Army as of the date of the enactment of this Act.

Speaker of the House of Representatives.

Vice President of the United States and
President of the Senate.

SOLUTION: Lord's Resistance Army Disarmament and Northern Uganda Recovery Act of 2009 - (Sec. 4) Directs the President to submit to Congress a regional strategy to guide U.S. support for multilateral efforts to eliminate the threat to civilians and regional stability posed by the Lord's Resistance Army (LRA). Requires the strategy to include: (1) a plan to help strengthen efforts by the United Nations (U.N.) and regional governments to protect civilians from attacks by the LRA; (2) an assessment of viable options through which the United States could help develop and support multilateral efforts to eliminate the threat posed by the LRA; (3) an interagency framework to plan, coordinate, and review diplomatic, economic, intelligence, and military elements of U.S. policy across the region regarding the LRA; (4) a description of the type and form of diplomatic engagement across the region undertaken to coordinate and implement U.S. policy regarding the LRA and to work multilaterally with regional mechanisms, including the Tripartite Plus Commission and the Great Lakes Pact; and (5) a description of how this engagement will fit within the context of broader efforts and policy objectives in the Great Lakes Region.

(Sec. 5) Authorizes the President to provide additional assistance to respond to the humanitarian needs of populations the Democratic Republic of Congo, southern Sudan, and Central African Republic affected by LRA activity.

(Sec. 6) Expresses the sense of Congress that the President should support efforts by the people of northern Uganda and the government of Uganda to: (1) assist internally displaced people in transition and returnees by spurring economic revitalization and advancing access to basic services at return sites; (2) enhance the accountability and administrative competency of local governance institutions and public agencies in northern Uganda; (3) strengthen the operational capacity of the civilian police and the justice system in northern Uganda; (4) establish mechanisms for the disarmament and reintegration of former combatants and those abducted by the LRA; and (5) promote programs to address psychosocial trauma.

Expresses the sense of Congress that: (1) the Secretary of State and the Administrator of the United States Agency for International Development (USAID) should work with Congress to increase future assistance to Uganda if the government of Uganda demonstrates a commitment to reconstruction in war-affected areas of northern Uganda; and (2) the Secretary should withhold non-humanitarian assistance to Uganda if the government of Uganda is not committed to reconstruction and reconciliation in the war-affected areas of northern Uganda and is not taking steps to ensure this process moves forward in a transparent and accountable manner.

(Sec. 7) Expresses the sense of Congress that a continued failure to take meaningful steps toward national reconciliation and accountability risks perpetuating political grievances and fueling new conflicts.

Authorizes the President to support efforts by the people of northern Uganda and the government of Uganda to promote transitional justice and reconciliation on both local and national levels, including to encourage implementation of the mechanisms in the Annexure to the Agreement on Accountability and Reconciliation between the government of Uganda and the LRA.

(Sec. 8) Directs the Secretary to report to Congress on implementation of the strategy and evaluation of the assistance under this Act.

(Sec. 9) Expresses the sense of Congress that: (1) of the total amounts to be appropriated for FY2011 for the Department of State and foreign operations, up to $10 million should be used to carry out activities under section 5; and (2) of the total amounts to be appropriated for FY2011-FY2013 for the Department of State and foreign operations, up to $10 million in each such fiscal year should be used to carry out activities under section 7.

(Sec. 10) Defines: (1) "Great Lakes Region" as the region comprising Burundi, Democratic Republic of Congo, Rwanda, southern Sudan, and Uganda; and (2) "LRA-affected areas" as those portions of northern Uganda, southern Sudan, northeastern Democratic Republic of Congo, and southeastern Central African Republic affected by the LRA.

PROBLEM: SECTION 1. SHORT TITLE.

This Act may be cited as the ''Section Commission to Advise on
Reforming Elections Act''.

SEC. 2. ESTABLISHMENT OF SELECT COMMISSION TO ADVISE ON REFORMING
ELECTIONS.

There is established a commission to be known as the ''Select
Commission to Advise on Reforming Elections'' (referred to in this Act
as the ''Commission''). The purposes of the Commission are to study the
laws relating to the financing of campaigns for elections for Federal
office and to report and recommend legislation to reform those laws.

SEC. 3. MEMBERSHIP OF COMMISSION.

(a) Appointment.--The Commission shall be composed of 12 members
appointed not later than 60 days after the date of the enactment of
this Act by the President, of whom--
(1) Three members shall be appointed from among a list of
nominees submitted by the majority leader of the House of
Representatives;
(2) Three members shall be appointed from among a list of
nominees submitted by the majority leader of the Senate;
(3) Two members shall be appointed from among a list of
nominees submitted by the minority leader of the House of
Representatives;
(4) Two members shall be appointed from among a list of
nominees submitted by the minority leader of the Senate; and
(5) Two members shall be appointed from individuals meeting
such criteria as the President may apply.
(b) Chair.--The members of the Commission shall select two members
to serve as co-chairs of the Commission.
(c) Terms.--The members of the Commission shall serve for the life
of the Commission.
(d) Vacancies.--A vacancy in the Commission shall be filled in the
manner in which the original appointment was made.

SEC. 4. POWERS OF COMMISSION.

(a) Hearings.--The Commission may, for the purpose of carrying out
this Act, hold hearings, sit and act at times and places, take
testimony, and receive evidence as the Commission considers
appropriate.
(b) Quorum.--Five members of the Commission shall constitute a
quorum, but a lesser number may hold hearings.

SEC. 5. ADMINISTRATIVE PROVISIONS.

(a) Pay and Travel Expenses of Members.--(1) Each member of the
Commission, other than the co-chairs, shall be paid at a rate equal to
the daily equivalent of the annual rate of basic pay payable for level
IV of the Executive Schedule under section 5315 of title 5, United
States Code, for each day (including travel time) during which the
member is engaged in the actual performance of duties vested in the
Commission. Each co-chair shall be paid for each day referred to in the
preceding sentence at a rate equal to the daily equivalent of the
annual rate of basic pay payable for level III of the Executive
Schedule under section 5314 of title 5, United States Code.
(2) Members of the Commission shall receive travel expenses,
including per diem in lieu of subsistence, in accordance with sections
5702 and 5703 of title 5, United States Code.
(b) Staff Director.--The Commission shall, without regard to
section 5311(b) of title 5, United States Code, appoint a staff
director, who shall be paid at the rate of basic pay payable for level
IV of the Executive Schedule under section 5315 of title 5, United
States Code.
(c) Staff of Commission; Services.--
(1) In general.--Subject to such rules as may be adopted by
the Commission, the staff director of the Commission, without
regard to the provisions of title 5, United States Code,
governing appointments in the competitive service and without
regard to the provisions of chapter 51 and subchapter III of
chapter 53 of that title relating to classifications and
General Schedule pay rates, and subject to the approval of the
Commission, may appoint such personnel as the staff director considers
necessary, except that an individual so appointed may not receive pay
in excess of the maximum annual rate of basic pay payable for grade GS-
15 of the General Schedule under section 5332 of title 5, United States
Code.
(2) Temporary and intermittent services.--Subject to the
approval of the Commission, the staff director of the
Commission may procure temporary and intermittent services to
the same extent as is authorized by section 3109(b) of title 5,
United States Code.

SEC. 6. REPORT AND RECOMMENDATIONS FOR CHANGES IN LAW.

(a) Report.--Not later than 180 days after the appointment of its
members, the Commission shall submit to the President, the Speaker and
minority leader of the House of Representatives, and the majority and
minority leaders of the Senate a report of the activities of the
Commission.
(b) Recommendations for Changes in Campaign Finance Laws.--
(1) In general.--Subject to paragraph (2), the Commission
shall submit to the President, the Speaker and minority leader
of the House of Representatives, and the majority and minority
leaders of the Senate any recommendations for changes in the
laws (including regulations) governing the conducting and
financing of Federal campaigns (including any changes in the
rules of the Senate or the House of Representatives) to which
seven or more members of the Commission may agree--
(A) by including such recommendations in the report
submitted under subsection (a); or
(B) with the approval of a majority of its members,
by submitting a supplemental report containing such
recommendations not later than 180 days after
submitting the report under subsection (a).
(2) Final deadline.--The Commission may not submit
recommendations under this subsection after July 15, 1998.
(c) Dissenting Views.--The Commission shall include in the report
submitted under subsection (a) and in any recommendations submitted
under subsection (b) any dissenting or minority views of its members,
including recommendations for changes in law which were proposed by any
member and to which seven or more members did not agree.

SEC. 7. EXPEDITED CONGRESSIONAL CONSIDERATION OF LEGISLATION
IMPLEMENTING RECOMMENDATIONS.

(a) Preparation of Legislation.--If the Commission submits any
recommendation for changes in the laws under section 6(b), those
members concurring in the recommendation shall include with the
recommendation legislation to implement the recommendation.
(b) Expedited Congressional Consideration of Legislation.--
(1) In general.--If any legislation is introduced the
substance of which implements a recommendation of the
Commission submitted under section 6(b), subject to paragraph
(2), the provisions of section 2908 (other than subsection (a))
of the Defense Base Closure and Realignment Act of 1990 shall
apply to the consideration of the legislation in the same
manner as such provisions apply to a joint resolution described
in section 2908(a) of such Act.
(2) Special rules.--For purposes of applying paragraph (1)
with respect to such provisions, the following rules shall
apply:
(A) Any reference to the Committee on Armed
Services of the House of Representatives shall be
deemed a reference to the Committee on House Oversight
of the House of Representatives and any reference to
the Committee on Armed Services of the Senate shall be
deemed a reference to the Committee on Rules and
Administration of the Senate.
(B) Any reference to the date on which the
President transmits a report shall be deemed a
reference to the date on which the recommendation
involved is submitted under section 6(b).

SEC. 8. TERMINATION.

The Commission shall cease to exist 90 days after the later of--
(1) the date of the submission of its report under section
6(a); or
(2) the date of the submission of its recommendations under
section 6(b).

SOLUTION: Select Commission to Advise on Reforming Elections Act - Establishes the Select Commission to Advise on Reforming Elections to study the laws relating to the financing of campaigns for Federal elections and to report and recommend legislation to reform those laws.
(Sec. 6) Requires the Commission to submit a report to the President, the Speaker and minority leader of the House of Representatives, and the majority and minority leaders of the Senate on its activities. Directs the Commission, as specified, to submit to the President, the Speaker and minority leader of the House of Representatives, and the majority and minority leaders of the Senate, any recommendations for changes in campaign finance laws to which seven or more Commission members may agree. Prohibits the submission of recommendations by the Commission after July 15, 1998.
(Sec. 7) Requires that when the Commission submits any recommendation for changes in campaign finance laws, those Commission members concurring in the recommendation shall include legislation to implement the recommendation. Provides for expedited congressional consideration of any legislation introduced which implements a recommendation of the Commission.
(Sec. 8) Terminates the Commission after the later of: (1) the submission of its report; or (2) the submission of its recommendations.

PROBLEM: SECTION 1. EXCEPTION FROM PASSIVE LOSS RULES FOR INVESTMENTS IN HIGH
TECHNOLOGY RESEARCH SMALL BUSINESS PASS-THRU ENTITIES.

(a) In General.--Subsection (c) of section 469 of the Internal
Revenue Code of 1986 is amended by redesignating paragraphs (4) through
(7) as paragraphs (5) through (8), respectively, and by inserting after
paragraph (3) the following new paragraph:
''(4) High technology research activities.--
''(A) In general.--The term 'passive activity'
shall not include any qualified research activity of
the taxpayer carried on by a high technology research
small business pass-thru entity.
''(B) Treatment of losses and deductions.--
''(i) In general.--Losses or deductions of
a taxpayer relating to qualified research
activities carried on by a high technology
research small business pass-thru entity shall
not be treated as losses or deductions,
respectively, from a passive activity except as
provided in clause (ii) and subparagraph (C).
''(ii) Limitation.--Clause (i) shall apply
to losses and deductions of a taxpayer relating
to a high technology small business pass-thru
entity for a taxable year only to the extent
that the aggregate losses and deductions of the
taxpayer relating to qualified research
activities of such entity for such taxable year
do not exceed the portion of the taxpayer's
adjusted basis in the taxpayer's ownership
interest in such entity that is attributable to
money or other property contributed--
''(I) in exchange for such
ownership interest, and
''(II) specifically for use in
connection with qualified research
activities.
For purposes of the preceding sentence, the
taxpayer's basis shall not include any portion
of such basis which is attributable to an
increase in a partner's share of the
liabilities of a partnership that is considered
under section 752(a) as a contribution of
money.
''(C) Treatment of carryovers.--Subparagraph (B)(i)
shall not apply to the portion of any loss or deduction
that is carried over under subsection (b) into a
taxable year other than the taxable year in which such
loss or deduction arose.
''(D) Qualified research activity.--For purposes of
this paragraph, the term 'qualified research activity'
means any activity constituting qualified research
(within the meaning of section 41(d)(1)(B) and taking
into account paragraphs (3) and (4) of section 41(d))
which involves a process of experimentation.
''(E) High technology research small business pass-
thru entity.--For purposes of this paragraph, the term
'high technology research small business pass-thru
entity' means any domestic pass-thru entity for any
taxable year if--
''(i) either--
''(I) more than 75 percent of the
entity's expenditures (including
salaries, rent and overhead) for such
taxable year are paid or incurred in
connection with qualified research
(within the meaning of section
41(d)(1)(B), taking into account
paragraphs (3) and (4) of section
41(d)) that involves a process of
experimentation conducted by the
entity, or
''(II) more than 50 percent of the
entity's expenditures for such taxable
year constitute qualified research
expenses (as defined in section 41(b),
but determined without regard to the
phrase '65 percent of' in paragraph
(3)(A) thereof),
''(ii) such entity is a small business
(within the meaning of section
41(b)(3)(D)(iii), applied by substituting '250'
for '500' in subclause (I) thereof), and
''(iii) at no time during the taxable year
does the entity have aggregate gross assets in
excess of $150,000,000.
''(F) Provisions related to aggregate gross assets
limitation.--For purposes of this paragraph--
''(i) In general.--Except as otherwise
provided in this subparagraph, the term
'aggregate gross assets' has the meaning given
such term in section 1202(d)(2).
''(ii) Exception for certain intangibles.--
Any section 197 intangible (as defined in
section 197(d) and determined without regard to
section 197(e)) which is used directly in
connection with the research referred to in
subparagraph (E)(i) shall not be taken into
account in determining aggregate gross assets.
''(iii) Exception for certain follow-on
investments.--Cash from a sale of equity
interests shall not be taken into account in
determining aggregate gross assets if--
''(I) the aggregate gross assets of
such entity (determined immediately
after such sale and without regard to
this clause) do not exceed the sum of
$150,000,000, plus 25 percent of the
aggregate gross assets of such entity
(determined immediately before such
sale and without regard to this
clause), and
''(II) the aggregate gross assets
of such entity (determined immediately
before such sale and without regard to
this clause) do not exceed
$150,000,000.
Sales of equity interests which are part of the
same plan or arrangement, or which are carried
out with the principal purpose of increasing
the amount of cash to which this clause applies
(determined without regard to this sentence),
shall be treated as a single sale for purposes
of this clause.
''(iv) Inflation adjustment.--In the case
of any taxable year beginning after 2015, the
$150,000,000 amount in subparagraph (E)(iii)
and subclauses (I) and (II) of clause (iii)
shall each be increased by an amount equal to--
''(I) such dollar amount,
multiplied by
''(II) the cost of living
adjustment determined under section
1(f)(3) for the calendar year in which
the taxable year begins determined by
substituting 'calendar year 2014' for
'calendar year 1992' in subparagraph
(B) thereof.
Any increase determined under the preceding
sentence shall be rounded to the nearest
$100,000.
''(G) Capital expenditures taken into account for
expenditures test.--An expenditure shall not fail to be
taken into account under subparagraph (E)(i) merely
because such expenditure is chargeable to capital
account.
''(H) Pass-thru entity.--For purposes of this
paragraph, the term 'pass-thru entity' means any
partnership, S corporation, or other entity identified
by the Secretary as a pass-thru entity for purposes of
this paragraph.
''(I) Aggregation rules.--
''(i) In general.--All persons treated as a
single employer under subsection (a) or (b) of
section 52, or subsection (m) or (o) of section
414, shall be treated as a single entity for
purposes of subparagraphs (E) and (F)(iii).
''(ii) Limitation where entity would not
qualify.--No entity shall be treated as a high
technology research small business pass-thru
entity unless such entity qualifies as such
both with and without the application of clause
(i).
''(J) Activities not engaged in for profit and
economic substance rules.--Section 183 and the economic
substance rules of section 7701(o) shall not apply to
disallow the losses, deductions, and credits of a high
technology research small business pass-thru entity
solely as a result of losses incurred by such
entity.''.
(b) Material Participation Not Required.--Paragraph (5) of section
469(c) of the Internal Revenue Code of 1986, as redesignated by
subsection (a), is amended by striking ''and (3)'' in the heading and
text and inserting '', (3), and (4)''.
(c) Certain Research-Related Deductions and Credits of High
Technology Research Small Business Pass-Thru Entities Allowed for
Purposes of Determining Alternative Minimum Tax.--
(1) Deduction for research and experimental expenditures.--
Paragraph (2) of section 56(b) of the Internal Revenue Code of
1986 is amended by adding at the end the following new
subparagraph:
''(E) Exception for high technology research small
business pass-thru entities.--In the case of a high
technology research small business pass-thru entity (as
defined in section 469(c)(4)), this paragraph shall not
apply to any amount allowable as a deduction under
section 174(a).''.
(2) Allowance of certain research-related credits.--
Subparagraph (B) of section 38(c)(4) of such Code is amended by
redesignating clauses (ii) through (ix) as clauses (iii)
through (x), respectively, and by inserting after clause (i)
the following new clause:
''(ii) the credits of an individual
taxpayer determined under sections 41 and 48D
to the extent attributable to a high technology
research small business pass-thru entity (as
defined in section 469(c)(4)),''.
(d) Exception to Limitation on Pass-Thru of Research Credit.--
Subsection (g) of section 41 of such Code is amended by adding at the
end the following: ''Paragraphs (2) and (4) shall not apply with
respect to any high technology research small business pass-thru entity
(as defined in section 469(c)(4)).''.
(e) Effective Date.--The amendments made by this section shall
apply to losses and credits arising in taxable years beginning on or
after the date of the enactment of this Act.

SOLUTION:
Amends the Internal Revenue Code to exempt from the definition of "passive activity," for purposes of the passive loss tax rules, any qualified research activity carried on by a high technology research small business pass-thru entity. Defines "high technology research small business pass-thru entity" as any domestic pass-thru entity if: (1) more than 75% of the entity's expenditures are paid or incurred in connection with qualified research, or (2) more than 50% of the entity's expenditures constitute qualified research expenses. Designates a high technology research entity as a small business if such entity has 250 or fewer full-time employees and does not have aggregate gross assets in excess of $150 million.