[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4169 Introduced in House (IH)]







104th CONGRESS
  2d Session
                                H. R. 4169

To amend the Internal Revenue Code of 1986 to provide that all computer 
             software shall be depreciable over 24 months.


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                    IN THE HOUSE OF REPRESENTATIVES

                           September 25, 1996

  Mr. Baker of California (for himself, Mr. White, and Mr. Campbell) 
 introduced the following bill; which was referred to the Committee on 
                             Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to provide that all computer 
             software shall be depreciable over 24 months.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. DEPRECIATION OF COMPUTER SOFTWARE.

    (a) In General.--Paragraph (1) of section 167(f) of the Internal 
Revenue Code of 1986 (relating to treatment of certain property 
excluded from section 197) is amended to read as follows:
            ``(1) Computer software.--If a depreciation deduction is 
        allowable under subsection (a) with respect to any computer 
        software (as defined in section 197(e)(3)(B)), such deduction 
        shall be computed--
                    ``(A) by using a useful life of 24 months, and
                    ``(B) by using the straight line method; except 
                that--
                            ``(i) 70 percent of the adjusted basis of 
                        such software as of the beginning of such 24 
                        months shall be allowed as a deduction under 
                        such method over the first 12 months of such 
                        period, and
                            ``(ii) the remainder of such basis shall be 
                        allowed as a deduction under such method over 
                        the second 12 months of such period.''
    (b) Exception From Intangible Amortization for All Computer 
Software.--Subparagraph (A) of section 197(e)(3) of such Code is 
amended to read as follows:
                    ``(A) In general.--Any computer software.''
    (c) Effective Date.--The amendments made by this section shall 
apply to property acquired after the date of the enactment of this Act.
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