[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 774 Introduced in Senate (IS)]







106th CONGRESS
  1st Session
                                 S. 774

 To amend the Internal Revenue Code of 1986 to increase the deduction 
        for meal and entertainment expenses of small businesses.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 13, 1999

  Mr. Breaux 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 increase the deduction 
        for meal and entertainment expenses of small businesses.

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

SECTION 1. SMALL BUSINESSES ALLOWED INCREASED DEDUCTION FOR MEAL AND 
              ENTERTAINMENT EXPENSES.

    (a) In General.--Subsection (n) of section 274 of the Internal 
Revenue Code of 1986 (relating to only 50 percent of meal and 
entertainment expenses allowed as deduction) is amended by adding at 
the end the following new paragraph:
            ``(4) Special rule for small businesses.--
                    ``(A) In general.--In the case of any taxpayer 
                which is a small business, paragraph (1) shall be 
                applied by substituting `the applicable percentage (as 
                defined in paragraph (3)(B))' for `50 percent'.
                    ``(B) Small business.--For purposes of this 
                paragraph, the term `small business' means, with 
                respect to expenses paid or incurred during any taxable 
                year--
                            ``(i) any corporation which meets the 
                        requirements of section 55(e)(1) for such year, 
                        and
                            ``(ii) any partnership or sole 
                        proprietorship which would meet such 
                        requirements if it were a corporation.''
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to taxable years beginning after December 31, 1999.
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