[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 1914 Introduced in Senate (IS)]







104th CONGRESS
  2d Session
                                S. 1914

To amend the Internal Revenue Code of 1986 to clarify the treatment of 
          research related to an existing business component.


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                   IN THE SENATE OF THE UNITED STATES

                             June 27, 1996

   Mr. Hatch introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to clarify the treatment of 
          research related to an existing business component.

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

SECTION 1. CLARIFICATION OF RESEARCH ON EXISTING BUSINESS COMPONENTS 
              ELIGIBLE FOR RESEARCH CREDIT.

    (a) In General.--Subparagraph (C) of section 41(d)(4) of the 
Internal Revenue Code or 1986 (relating to activities for which credit 
is not allowed) is amended by adding at the end the following new 
sentence: ``The preceding sentence shall not apply to research related 
to the development of a business component of a taxpayer which is an 
original alternative to achieve the equivalent result of an existing 
business component of a competitor of the taxpayer.''
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after the date of the enactment of this Act.
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