[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 542 Introduced in Senate (IS)]







106th CONGRESS
  1st Session
                                 S. 542

To amend the Internal Revenue Code of 1986 to expand the deduction for 
  computer donations to schools and to allow a tax credit for donated 
                               computers.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 4, 1999

    Mr. Abraham (for himself, Mr. Wyden, Mr. Hatch, Mr. Kerrey, Mr. 
 Coverdell, Mr. Daschle, Mr. Jeffords, Mr. Lieberman, Mr. Allard, Mr. 
 Gorton, Mr. Burns, and Mr. McConnell) 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 expand the deduction for 
  computer donations to schools and to allow a tax credit for donated 
                               computers.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``New Millennium Classrooms Act''.

SEC. 2. EXPANSION OF DEDUCTION FOR COMPUTER DONATIONS TO SCHOOLS.

    (a) Extension of Age of Eligible Computers.--Section 
170(e)(6)(B)(ii) of the Internal Revenue Code of 1986 (defining 
qualified elementary or secondary educational contribution) is 
amended--
            (1) by striking ``2 years'' and inserting ``3 years'', and
            (2) by inserting ``for the taxpayer's own use'' after 
        ``constructed by the taxpayer''.
    (b) Reacquired Computers Eligible for Donation.--
            (1) In general.--Section 170(e)(6)(B)(iii) of the Internal 
        Revenue Code of 1986 (defining qualified elementary or 
        secondary educational contribution) is amended by inserting ``, 
        the person from whom the donor reacquires the property,'' after 
        ``the donor''.
            (2) Conforming amendment.--Section 170(e)(6)(B)(ii) of such 
        Code is amended by inserting ``or reaquired'' after 
        ``acquired''.
    (c) Effective Date.--The amendments made by this section shall 
apply to contributions made in taxable years ending after the date of 
the enactment of this Act.

SEC. 3. CREDIT FOR COMPUTER DONATIONS TO SCHOOLS.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to business related 
credits) is amended by adding at the end the following:

``SEC. 45D. CREDIT FOR COMPUTER DONATIONS TO SCHOOLS.

    ``(a) General Rule.--For purposes of section 38, the school 
computer donation credit determined under this section is an amount 
equal to 30 percent of the qualified elementary or secondary 
educational contributions (as defined in section 170(e)(6)(B)) made by 
the taxpayer during the taxable year.
    ``(b) Increased Percentage for Contributions to Schools in 
Empowerment Zones, Enterprise Communities, and Indian Reservations.--In 
the case of a qualified elementary or secondary educational 
contribution (as so defined) to an educational organization or entity 
located in an empowerment zone or enterprise community designated under 
section 1391 or an Indian reservation (as defined in section 
168(j)(6)), subsection (a) shall be applied by substituting `50 
percent' for `30 percent'.
    ``(c) Certain Rules Made Applicable.--For purposes of this section, 
rules similar to the rules of paragraphs (1) and (2) of section 41(f) 
shall apply.
    ``(d) Termination.--This section shall not apply to taxable years 
beginning on or after the date which is 3 years after the date of the 
enactment of the New Millennium Classrooms Act.
    (b) Current Year Business Credit Calculation.--Section 38(b) of the 
Internal Revenue Code of 1986 (relating to current year business 
credit) is amended by striking ``plus'' at the end of paragraph (11), 
by striking the period at the end of paragraph (12) and inserting ``, 
plus'', and by adding at the end the following:
            ``(13) the school computer donation credit determined under 
        section 45D(a).''
    (c) Disallowance of Deduction by Amount of Credit.--Section 280C of 
the Internal Revenue Code of 1986 (relating to certain expenses for 
which credits are allowable) is amended by adding at the end the 
following:
    ``(d) Credit for School Computer Donations.--No deduction shall be 
allowed for that portion of the qualified elementary or secondary 
educational contributions (as defined in section 170(e)(6)(B)) made 
during the taxable year that is equal to the amount of credit 
determined for the taxable year under section 45D(a). In the case of a 
corporation which is a member of a controlled group of corporations 
(within the meaning of section 52(a)) or a trade or business which is 
treated as being under common control with other trades or businesses 
(within the meaning of section 52(b)), this subsection shall be applied 
under rules prescribed by the Secretary similar to the rules applicable 
under subsections (a) and (b) of section 52.''
    (d) Limitation on Carryback.--Subsection (d) of section 39 of the 
Internal Revenue Code of 1986 (relating to carryback and carryforward 
of unused credits) is amended by adding at the end the following:
            ``(9) No carryback of school computer donation credit 
        before effective date.--No amount of unused business credit 
        available under section 45D may be carried back to a taxable 
        year beginning on or before the date of the enactment of this 
        paragraph.''
    (e) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by inserting after the item relating to section 45C the 
following:

                              ``Sec. 45D. Credit for computer donations 
                                        to schools.''
    (f) Effective Date.--The amendments made by this section shall 
apply to contributions made in taxable years beginning after the date 
of the enactment of this Act.
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