[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2761 Introduced in House (IH)]







107th CONGRESS
  1st Session
                                H. R. 2761

To amend the Internal Revenue Code of 1986 to provide tax benefits for 
small businesses, to repeal the Federal communications excise tax, and 
                          for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             August 2, 2001

Ms. Hooley of Oregon 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 tax benefits for 
small businesses, to repeal the Federal communications excise tax, and 
                          for other purposes.

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

SECTION 1. SHORT TITLE; REFERENCES; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Small Business Tax 
Fairness Act of 2001''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.
    (c) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; references; table of contents.
                   TITLE I--SMALL BUSINESS PROVISIONS

Sec. 101. Deduction for 100 percent of health insurance costs of self-
                            employed individuals.
Sec. 102. Increase in expense treatment for small businesses.
Sec. 103. Increased deduction for meal expenses.
Sec. 104. Increased deductibility of business meal expenses for 
                            individuals subject to Federal limitations 
                            on hours of service.
Sec. 105. Income averaging for farmers and fishermen not to increase 
                            alternative minimum tax liability.
Sec. 106. Clarification of cash accounting rules for small business.
Sec. 107. Extension of research credit made permanent.
                      TITLE II--TIMBER INCENTIVES

Sec. 201. Partial inflation adjustment for timber.
Sec. 202. Amortization of reforestation expenditures and reforestation 
                            tax 
                            credit.
                   TITLE III--ENERGY EFFICIENT HOMES

Sec. 301. Credit for energy efficiency improvements to existing homes.
Sec. 302. Business credit for construction of new energy efficient 
                            home.
         TITLE IV--REPEAL OF FEDERAL COMMUNICATIONS EXCISE TAX

Sec. 401. Repeal of Federal communications excise tax.
 TITLE V--DONATION OF COMPUTER TECHNOLOGY AND EQUIPMENT TO ELEMENTARY 
                         AND SECONDARY SCHOOLS

Sec. 501. Credit for donation of computer technology and equipment to 
                            elementary and secondary schools.

                   TITLE I--SMALL BUSINESS PROVISIONS

SEC. 101. DEDUCTION FOR 100 PERCENT OF HEALTH INSURANCE COSTS OF SELF-
              EMPLOYED INDIVIDUALS.

    (a) In General.--Paragraph (1) of section 162(l) is amended to read 
as follows:
            ``(1) Allowance of deduction.--In the case of an individual 
        who is an employee within the meaning of section 401(c)(1), 
        there shall be allowed as a deduction under this section an 
        amount equal to 100 percent of the amount paid during the 
        taxable year for insurance which constitutes medical care for 
        the taxpayer and the taxpayer's spouse and dependents.''.
    (b) Clarification of Limitations on Other Coverage.--The first 
sentence of section 162(l)(2)(B) is amended to read as follows: 
``Paragraph (1) shall not apply to any taxpayer for any calendar month 
for which the taxpayer participates in any subsidized health plan 
maintained by any employer (other than an employer described in section 
401(c)(4)) of the taxpayer or the spouse of the taxpayer.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2000.

SEC. 102. INCREASE IN EXPENSE TREATMENT FOR SMALL BUSINESSES.

    (a) In General.--Paragraph (1) of section 179(b) (relating to 
dollar limitation) is amended to read as follows:
            ``(1) Dollar limitation.--The aggregate cost which may be 
        taken into account under subsection (a) for any taxable year 
        shall not exceed $30,000.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2000.

SEC. 103. INCREASED DEDUCTION FOR MEAL EXPENSES.

    (a) In General.--Paragraph (1) of section 274(n) (relating to only 
50 percent of meal and entertainment expenses allowed as deduction) is 
amended by striking ``50 percent'' in the text and inserting ``the 
allowable percentage''.
    (b) Allowable Percentages.--Subsection (n) of section 274 is 
amended by redesignating paragraphs (2) and (3) as paragraphs (3) and 
(4), respectively, and by inserting after paragraph (1) the following 
new paragraph:
            ``(2) Allowable percentage.--For purposes of paragraph (1), 
        the allowable percentage is--
                    ``(A) in the case of amounts for items described in 
                paragraph (1)(B), 50 percent, and
                    ``(B) in the case of expenses for food or 
                beverages, 60 percent (55 percent for taxable years 
                beginning during 2001).''.
    (c) Conforming Amendment.--The heading for subsection (n) of 
section 274 is amended by striking ``50 Percent'' and inserting 
``Limited Percentages''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2000.

SEC. 104. INCREASED DEDUCTIBILITY OF BUSINESS MEAL EXPENSES FOR 
              INDIVIDUALS SUBJECT TO FEDERAL LIMITATIONS ON HOURS OF 
              SERVICE.

    (a) In General.--Paragraph (4) of section 274(n) (relating to 
limited percentages of meal and entertainment expenses allowed as 
deduction), as redesignated by section 103, is amended to read as 
follows:
            ``(4) Special rule for individuals subject to federal hours 
        of service.--In the case of any expenses for food or beverages 
        consumed while away from home (within the meaning of section 
        162(a)(2)) by an individual during, or incident to, the period 
        of duty subject to the hours of service limitations of the 
        Department of Transportation, paragraph (2)(B) shall be applied 
        by substituting `80 percent' for the percentage otherwise 
        applicable under paragraph (2)(B).''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to taxable years beginning after December 31, 2000.

SEC. 105. INCOME AVERAGING FOR FARMERS AND FISHERMEN NOT TO INCREASE 
              ALTERNATIVE MINIMUM TAX LIABILITY.

    (a) In General.--Section 55(c) (defining regular tax) is amended by 
redesignating paragraph (2) as paragraph (3) and by inserting after 
paragraph (1) the following:
            ``(2) Coordination with income averaging for farmers and 
        fishermen.--Solely for purposes of this section, section 1301 
        (relating to averaging of farm and fishing income) shall not 
        apply in computing the regular tax.''.
    (b) Allowing Income Averaging for Fishermen.--
            (1) In general.--Section 1301(a) is amended by striking 
        ``farming business'' and inserting ``farming business or 
        fishing business,''.
            (2) Definition of elected farm income.--
                    (A) In general.--Clause (i) of section 
                1301(b)(1)(A) is amended by inserting ``or fishing 
                business'' before the semicolon.
                    (B) Conforming amendment.--Subparagraph (B) of 
                section 1301(b)(1) is amended by inserting ``or fishing 
                business'' after ``farming business'' both places it 
                occurs.
            (3) Definition of fishing business.--Section 1301(b) is 
        amended by adding at the end the following new paragraph:
            ``(4) Fishing business.--The term `fishing business' means 
        the conduct of commercial fishing as defined in section 3 of 
        the Magnuson-Stevens Fishery Conservation and Management Act 
        (16 U.S.C. 1802).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2000.

SEC. 106. CLARIFICATION OF CASH ACCOUNTING RULES FOR SMALL BUSINESS.

    (a) Section 446 (relating to general rule for methods of 
accounting) is amended by adding at the end the following new 
subsection:
    ``(g) Small Taxpayers Permitted To Use Cash Accounting Method 
Without Limitation.--A taxpayer shall not be required to use an accrual 
method of accounting for any taxable year by reason of using 
merchandise or inventory, if the average annual gross receipts of such 
taxpayer (or any predecessor) for the 3-year-period ending with such 
prior taxable year does not exceed $5,000,000. The rules of paragraphs 
(2) and (3) of section 448(c) shall apply for purposes of the preceding 
sentence. In the case of a C corporation or a partnership which has a C 
corporation as a partner, the first sentence of this subsection shall 
apply only if such C corporation or partnership meets the requirements 
of section 448(b)(3).''
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after the date of the enactment of this Act.

SEC. 107. EXTENSION OF RESEARCH CREDIT MADE PERMANENT.

    (a) In General.--Section 41 (relating to credit for increasing 
research activities) is amended by striking subsection (h).
    (b) Conforming Amendment.--Paragraph (1) of section 45C(b) of such 
Code is amended by striking subparagraph (D).

                      TITLE II--TIMBER INCENTIVES

SEC. 201. PARTIAL INFLATION ADJUSTMENT FOR TIMBER.

    (a) In General.--Part I of subchapter P of chapter 1 (relating to 
treatment of capital gains) is amended by adding at the end the 
following new section:

``SEC. 1203. PARTIAL INFLATION ADJUSTMENT FOR TIMBER.

    ``(a) In General.--At the election of any taxpayer who has 
qualified timber gain for any taxable year, there shall be allowed as a 
deduction from gross income an amount equal to the qualified percentage 
of such gain.
    ``(b) Qualified Timber Gain.--For purposes of this section, the 
term `qualified timber gain' means long-term capital gain from the sale 
or exchange of timber.
    ``(c) Qualified Percentage.--For purposes of this section, the term 
`qualified percentage' means the percentage (not exceeding 50 percent) 
determined by multiplying--
            ``(1) 3 percent, by
            ``(2) the number of years in the holding period of the 
        taxpayer with respect to the timber.
    ``(d) Estates and Trusts.--In the case of an estate or trust, the 
deduction under subsection (a) shall be computed by excluding the 
portion of (if any) the gains for the taxable year from sales or 
exchanges of capital assets which, under sections 652 and 662 (relating 
to inclusions of amounts in gross income of beneficiaries of trusts), 
is includible by the income beneficiaries as gain derived from the sale 
or exchange of capital assets.''
    (b) Coordination With Maximum Rates of Tax on Net Capital Gains.--
            (1) Subsection (h)(4) of section 1 (relating to maximum 
        capital gains rate) is amended by striking ``and'' at the end 
        of subparagraph (A), by striking the period at the end of 
        subparagraph (B) and inserting ``, and'', and by adding at the 
        end the following new subparagraph:
                    ``(C) qualified timber gain with respect to which 
                an election is in effect under section 1203.''
            (2) Subsection (a) of section 1201 (relating to the 
        alternative tax for corporations) is amended by inserting at 
        the end thereof the following new sentence:
``For purposes of this section, net capital gain shall be determined 
without regard to qualified timber gain (as defined in section 1203) 
with respect to which an election is in effect under section 1203.''
    (c) Allowance of Deduction in Computing Adjusted Gross Income.--
Subsection (a) of section 62 (relating to definition of adjusted gross 
income) is amended by inserting after paragraph (18) the following new 
paragraph:
            ``(19) Partial inflation adjustment for timber.--The 
        deduction allowed by section 1203.''
    (d) Technical Amendments.--
            (1) Subparagraph (B) of section 172(d)(2) is amended to 
        read as follows:
                    ``(B) the exclusion under section 1202 and the 
                deduction under section 1203 shall not be allowed.''
            (2) The last sentence of section 453A(c)(3) is amended by 
        striking ``(whichever is appropriate)'' and inserting ``or the 
        deduction under section 1203 (whichever is appropriate)''.
            (3) Section 641(c)(2)(C) is amended by inserting after 
        clause (iii) the following new clause:
                            ``(iv) The deduction under section 1203.''
            (4) The first sentence of section 642(c)(4) is amended to 
        read as follows: ``To the extent that the amount otherwise 
        allowable as a deduction under this subsection consists of gain 
        described in section 1202(a) or qualified timber gain (as 
        defined in section 1203(b)), proper adjustment shall be made 
        for any exclusion allowable under section 1202, and any 
        deduction allowable under section 1203, to the estate or 
        trust.''
            (5) The last sentence of section 643(a)(3) is amended to 
        read as follows: ``The exclusion under section 1202 and the 
        deduction under section 1203 shall not be taken into account.''
            (6) Subparagraph (C) of section 643(a)(6) is amended by 
        inserting ``(i)'' before ``there shall'' and by inserting 
        before the period ``, and (ii) the deduction under section 1203 
        (relating to partial inflation adjustment for timber) shall not 
        be taken into account''.
            (7) Paragraph (4) of section 691(c) is amended by inserting 
        ``1203,'' after ``1202,''.
            (8) The second sentence of paragraph (2) of section 871(a) 
        is amended by striking ``section 1202'' and inserting 
        ``sections 1202 and 1203''.
    (e) Clerical Amendment.--The table of sections for part I of 
subchapter P of chapter 1 is amended by adding at the end the following 
new item:

                              ``Sec. 1203. Partial inflation adjustment 
                                        for timber.''
    (f) Effective Date.--The amendments made by this section shall 
apply to sales or exchanges after December 31, 2000.

SEC. 202. AMORTIZATION OF REFORESTATION EXPENDITURES AND REFORESTATION 
              TAX CREDIT.

    (a) Decrease in Amortization Period.--
            (1) In general.--Section 194(a) is amended by striking ``84 
        months'' and inserting ``60 months''.
            (2) Conforming amendment.--Section 194(a) is amended by 
        striking ``84-month period'' and inserting ``60-month period''.
    (b) Removal of Cap on Amortizable Basis.--
            (1) Section 194 is amended by striking subsection (b) and 
        by redesignating subsections (c) and (d) as subsections (b) and 
        (c), respectively.
            (2) Subsection (b) of section 194 (as redesignated by 
        paragraph (1)) is amended by striking paragraph (4).
            (3) Paragraph (1) of section 48(b) is amended by striking 
        ``(after the application of section 194(b)(1))''.
    (c) Effective Date.--The amendments made by this section shall 
apply to additions to capital account made after December 31, 2000.

                   TITLE III--ENERGY EFFICIENT HOMES

SEC. 301. CREDIT FOR ENERGY EFFICIENCY IMPROVEMENTS TO EXISTING HOMES.

    (a) In General.--Subpart A of part IV of subchapter A of chapter 1 
(relating to nonrefundable personal credits) is amended by inserting 
after section 25B the following new section:

``SEC. 25C. ENERGY EFFICIENCY IMPROVEMENTS TO EXISTING HOMES.

    ``(a) Allowance of Credit.--In the case of an individual, there 
shall be allowed as a credit against the tax imposed by this chapter 
for the taxable year an amount equal to 20 percent of the amount paid 
or incurred by the taxpayer for qualified energy efficiency 
improvements installed during such taxable year.
    ``(b) Limitations.--
            ``(1) Maximum credit.--The credit allowed by this section 
        with respect to a dwelling shall not exceed $2,000.
            ``(2) Prior credit amounts for taxpayer on same dwelling 
        taken into account.--If a credit was allowed to the taxpayer 
        under subsection (a) with respect to a dwelling in 1 or more 
        prior taxable years, the amount of the credit otherwise 
        allowable for the taxable year with respect to that dwelling 
        shall not exceed the amount of $2,000 reduced by the sum of the 
        credits allowed under subsection (a) to the taxpayer with 
        respect to the dwelling for all prior taxable years.
    ``(c) Carryforward of Unused Credit.--If the credit allowable under 
subsection (a) exceeds the limitation imposed by section 26(a) for such 
taxable year reduced by the sum of the credits allowable under subpart 
A of part IV of subchapter A (other than this section), such excess 
shall be carried to the succeeding taxable year and added to the credit 
allowable under subsection (a) for such taxable year.
    ``(d) Qualified Energy Efficiency Improvements.--For purposes of 
this section, the term `qualified energy efficiency improvements' means 
any energy efficient building envelope component, and any energy 
efficient heating, cooling, or water heating appliance, the 
installation of which, by itself or in combination with other such 
components or appliances, is certified to improve the annual energy 
performance of the existing home by at least 30 percent, if--
            ``(1) such component or appliance is installed in or on a 
        dwelling--
                    ``(A) located in the United States, and
                    ``(B) owned and used by the taxpayer as the 
                taxpayer's principal residence (within the meaning of 
                section 121),
            ``(2) the original use of such component or appliance 
        commences with the taxpayer, and
            ``(3) such component or appliance reasonably can be 
        expected to remain in use for at least 5 years.
Such certification shall be made by the contractor who installed such 
improvements, a local building regulatory authority, or a qualified 
energy consultant (such as a utility or an accredited home energy 
rating system provider).
    ``(e) Special Rules.--
            ``(1) Tenant-stockholder in cooperative housing 
        corporation.--In the case of an individual who is a tenant-
        stockholder (as defined in section 216) in a cooperative 
        housing corporation (as defined in such section), such 
        individual shall be treated as having paid his tenant-
        stockholder's proportionate share (as defined in section 
        216(b)(3)) of the cost of qualified energy efficiency 
        improvements made by such corporation.
            ``(2) Condominiums.--
                    ``(A) In general.--In the case of an individual who 
                is a member of a condominium management association 
                with respect to a condominium which he owns, such 
                individual shall be treated as having paid his 
                proportionate share of the cost of qualified energy 
                efficiency improvements made by such association.
                    ``(B) Condominium management association.--For 
                purposes of this paragraph, the term `condominium 
                management association' means an organization which 
                meets the requirements of paragraph (1) of section 
                528(c) (other than subparagraph (E) thereof) with 
                respect to a condominium project substantially all of 
                the units of which are used as residences.
    ``(f) Basis Adjustment.--For purposes of this subtitle, if a credit 
is allowed under this section for any expenditure with respect to any 
property, the increase in the basis of such property which would (but 
for this subsection) result from such expenditure shall be reduced by 
the amount of the credit so allowed.
    ``(g) Termination.--Subsection (a) shall apply to qualified energy 
efficiency improvements installed during the period beginning on 
January 1, 2000, and ending on December 31, 2004.''.
    (b) Conforming Amendments.--
            (1) Subsection (c) of section 23 is amended by inserting 
        ``, section 25C, and section 1400C'' after ``other than this 
        section''.
            (2) Subparagraph (C) of section 25(e)(1) is amended by 
        inserting ``25C,'' after ``25B''.
            (3) Subsection (d) of section 1400C is amended by striking 
        ``and 25B'' and inserting ``, 25B, and 25C''.
            (4) Subsection (a) of section 1016 is amended by striking 
        ``and'' at the end of paragraph (27), by striking the period at 
        the end of paragraph (28) and inserting ``; and'', and by 
        adding at the end the following new paragraph:
            ``(29) to the extent provided in section 25C(f), in the 
        case of amounts with respect to which a credit has been allowed 
        under section 25C.''.
            (5) The table of sections for subpart A of part IV of 
        subchapter A of chapter 1 is amended by inserting after the 
        item relating to section 25B the following new item:

                              ``Sec. 25C. Energy efficiency 
                                        improvements to existing 
                                        homes.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after December 31, 2000.

SEC. 302. BUSINESS CREDIT FOR CONSTRUCTION OF NEW ENERGY EFFICIENT 
              HOME.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
(relating to business related credits) is amended by inserting after 
section 45F the following new section:

``SEC. 45G. NEW ENERGY EFFICIENT HOME CREDIT.

    ``(a) In General.--For purposes of section 38, in the case of an 
eligible contractor, the credit determined under this section for the 
taxable year is an amount equal to the aggregate adjusted bases of all 
energy efficient property installed in a qualified new energy efficient 
home during construction of such home.
    ``(b) Limitations.--
            ``(1) Maximum credit.--
                    ``(A) In general.--The credit allowed by this 
                section with respect to a dwelling shall not exceed 
                $2,000.
                    ``(B) Prior credit amounts on same dwelling taken 
                into account.--If a credit was allowed under subsection 
                (a) with respect to a dwelling in 1 or more prior 
                taxable years, the amount of the credit otherwise 
                allowable for the taxable year with respect to that 
                dwelling shall not exceed the amount of $2,000 reduced 
                by the sum of the credits allowed under subsection (a) 
                with respect to the dwelling for all prior taxable 
                years.
            ``(2) Coordination with rehabilitation and energy 
        credits.--For purposes of this section--
                    ``(A) the basis of any property referred to in 
                subsection (a) shall be reduced by that portion of the 
                basis of any property which is attributable to 
                qualified rehabilitation expenditures (as defined in 
                section 47(c)(2)) or to the energy percentage of energy 
                property (as determined under section 48(a)), and
                    ``(B) expenditures taken into account under either 
                section 47 or 48(a) shall not be taken into account 
                under this section.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Eligible contractor.--The term `eligible contractor' 
        means the person who constructed the new energy efficient home.
            ``(2) Energy efficient property.--The term `energy 
        efficient property' means any energy efficient building 
        envelope component, and any energy efficient heating, cooling, 
        or water heating appliance.
            ``(3) Qualified new energy efficient home.--The term 
        `qualified new energy efficient home' means a dwelling--
                    ``(A) located in the United States,
                    ``(B) the construction of which is substantially 
                completed after December 31, 2000,
                    ``(C) the original use of which is as a principal 
                residence (within the meaning of section 121) which 
                commences with the person who acquires such dwelling 
                from the eligible contractor, and
                    ``(D) the energy efficiency of which is certified 
                to exceed by 30 percent or more the applicable 
                standards for energy efficiency, based upon energy use 
                or building component performance established for 
                comparable dwellings under the 1998 International 
                Energy Conservation Code.
            ``(4) Construction.--The term `construction' includes 
        reconstruction and rehabilitation.
            ``(5) Acquire.--The term `acquire' includes purchase and, 
        in the case of reconstruction and rehabilitation, such term 
        includes a binding written contract for such reconstruction or 
        rehabilitation.
    ``(d) Certification.--A certification described in subsection 
(c)(3)(D) with respect to a dwelling shall be made by the eligible 
contractor, a local building regulatory authority, or a qualified 
energy consultant (such as a utility or an accredited home energy 
rating system provider).
    ``(e) Basis Adjustment.--For purposes of this subtitle, if a credit 
is allowed under this section for any expenditure with respect to any 
property, the increase in the basis of such property which would (but 
for this subsection) result from such expenditure shall be reduced by 
the amount of the credit so allowed.
    ``(f) Termination.--Subsection (a) shall apply to dwellings 
purchased during the period beginning on January 1, 2000, and ending on 
December 31, 2004.''.
    (b) Credit Made Part of General Business Credit.--Subsection (b) of 
section 38 (relating to current year business credit) is amended by 
striking ``plus'' at the end of paragraph (14), by striking the period 
at the end of paragraph (15) and inserting ``, plus'', and by adding at 
the end thereof the following new paragraph:
            ``(16) the new energy efficient home credit determined 
        under section 45G.''.
    (c) Denial of Double Benefit.--Section 280C (relating to certain 
expenses for which credits are allowable) is amended by adding at the 
end thereof the following new subsection:
    ``(d) New Energy Efficient Home Expenses.--No deduction shall be 
allowed for that portion of expenses for a new energy efficient home 
otherwise allowable as a deduction for the taxable year which is equal 
to the amount of the credit determined for such taxable year under 
section 45G.''.
    (d) Credit Allowed Against Regular and Minimum Tax.--
            (1) In general.--Subsection (c) of section 38 (relating to 
        limitation based on amount of tax) is amended by redesignating 
        paragraph (4) as paragraph (5) and by inserting after paragraph 
        (3) the following new paragraph:
            ``(4) Special rules for new energy efficient home credit.--
                    ``(A) In general.--In the case of the new energy 
                efficient home credit--
                            ``(i) this section and section 39 shall be 
                        applied separately with respect to the credit, 
                        and
                            ``(ii) in applying paragraph (1) to the 
                        credit--
                                    ``(I) subparagraph (A) thereof 
                                shall not apply, and
                                    ``(II) the limitation under 
                                paragraph (1) (as modified by subclause 
                                (I)) shall be reduced by the credit 
                                allowed under subsection (a) for the 
                                taxable year (other than the new energy 
                                efficient home credit).
                    ``(B) New energy efficient home credit.--For 
                purposes of this subsection, the term `new energy 
                efficient home credit' means the credit allowable under 
                subsection (a) by reason of section 45G.''.
            (2) Conforming amendment.--Subclause (II) of section 
        38(c)(2)(A)(ii) is amended by inserting ``, the new energy 
        efficient home credit,'' after ``employment credit''.
    (e) Limitation on Carryback.--Subsection (d) of section 39 is 
amended by adding at the end the following new paragraph:
            ``(11) No carryback of new energy efficient home credit 
        before effective date.--No portion of the unused business 
        credit for any taxable year which is attributable to the credit 
        determined under section 45G may be carried back to any taxable 
        year ending before the date of the enactment of section 45G.''.
    (f) Deduction for Certain Unused Business Credits.--Subsection (c) 
of section 196 is amended by striking ``and'' at the end of paragraph 
(8), by striking the period at the end of paragraph (9) and inserting 
``, and'', and by adding after paragraph (9) the following new 
paragraph:
            ``(10) the new energy efficient home credit determined 
        under section 45G.''.
    (g) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 is amended by inserting after the 
item relating to section 45F the following new item:

                              ``Sec. 45G. New energy efficient home 
                                        credit.''.
    (h) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after December 31, 2000.

         TITLE IV--REPEAL OF FEDERAL COMMUNICATIONS EXCISE TAX

SEC. 401. REPEAL OF FEDERAL COMMUNICATIONS EXCISE TAX.

    (a) In General.--Chapter 33 (relating to facilities and services) 
is amended by striking subchapter B.
    (b) Phase-Out of Tax.--Paragraph (2) of section 4251(b) (defining 
applicable percentage) is amended to read as follows:
            ``(2) Applicable percentage.--The term `applicable 
        percentage' means--
                    ``(A) 2 percent with respect to amounts paid 
                pursuant to bills first rendered on or after the 30th 
                day after the date of the enactment of this 
                subparagraph and before October 1, 2001, and
                    ``(B) 1 percent with respect to amounts paid 
                pursuant to bills first rendered after September 30, 
                2001, and before October 1, 2002.''.
    (c) Conforming Amendments.--
            (1) Section 4293 is amended by striking ``chapter 32 (other 
        than the taxes imposed by sections 4064 and 4121) and 
        subchapter B of chapter 33,'' and inserting ``and chapter 32 
        (other than the taxes imposed by sections 4064 and 4121),''.
            (2)(A) Paragraph (1) of section 6302(e) is amended by 
        striking ``section 4251 or''.
            (B) Paragraph (2) of section 6302(e) is amended--
                    (i) by striking ``imposed by--'' and all that 
                follows through ``with respect to'' and inserting 
                ``imposed by section 4261 or 4271 with respect to'', 
                and
                    (ii) by striking ``bills rendered or''.
            (C) The subsection heading for section 6302(e) is amended 
        by striking ``Communications Services and''.
            (3) Section 6415 is amended by striking ``4251, 4261, or 
        4271'' each place it appears and inserting ``4261 or 4271''.
            (4) Paragraph (2) of section 7871(a) is amended by 
        inserting ``or'' at the end of subparagraph (B), by striking 
        subparagraph (C), and by redesignating subparagraph (D) as 
        subparagraph (C).
            (5) The table of subchapters for chapter 33 is amended by 
        striking the item relating to subchapter B.
    (d) Effective Dates.--
            (1) Repeal.--The amendments made by subsections (a) and (c) 
        shall apply to amounts paid pursuant to bills first rendered 
        after September 30, 2002.
            (2) Phase-out.--The amendment made by subsection (b) shall 
        apply to amounts paid pursuant to bills first rendered on or 
        after the 30th day after the date of the enactment of this Act.

 TITLE V--DONATION OF COMPUTER TECHNOLOGY AND EQUIPMENT TO ELEMENTARY 
                         AND SECONDARY SCHOOLS

SEC. 501. CREDIT FOR DONATION OF COMPUTER TECHNOLOGY AND EQUIPMENT TO 
              ELEMENTARY AND SECONDARY SCHOOLS.

    (a) General Rule.--Subpart D of part IV of subchapter A of chapter 
1 (relating to business related credits) is amended by adding at the 
end the following new section:

``SEC. 45H. DONATION OF COMPUTER TECHNOLOGY AND EQUIPMENT TO ELEMENTARY 
              AND SECONDARY SCHOOLS.

    ``(a) General Rule.--For purposes of section 38, the computer 
donation credit determined under this section for the taxable year is 
an amount equal to 50 percent of the qualified computer technology 
donations made in the taxable year by a corporation.
    ``(b) Limitation.--The credit allowed under subsection (a) shall 
not exceed 10 percent of the corporation's taxable income computed 
without regard to--
            ``(1) this section,
            ``(2) part VIII (except section 248),
            ``(3) any net operating loss carryback to the taxable year 
        under section 172, and
            ``(4) any capital loss carryback to the taxable year under 
        section 1212(a)(1).
    ``(c) Definitions.--For purposes of subsection (a)--
            ``(1) Qualified computer technology donations.--The term 
        `qualified computer technology donations' means a qualified 
        elementary or secondary educational contribution (as defined in 
        section 170(e)(6).
            ``(2) Corporation.--The term `corporation' shall have the 
        meaning given to such term by section 170(e)(4)(D).''
    (b) Credit Made Part of General Business Credit.--Subsection (b) of 
section 38 is amended by striking ``plus'' at the end of paragraph 
(15), by striking the period at the end of paragraph (16) and inserting 
``, plus'', and by adding at the end thereof the following new 
paragraph:
            ``(17) the computer donation credit determined under 
        section 45H(a).''.
    (c) Credit Allowed Against Regular and Minimum Tax.--
            (1) In general.--Subsection (c) of section 38 (relating to 
        limitation based on amount of tax) is amended by redesignating 
        paragraph (5) as paragraph (6) and by inserting after paragraph 
        (4) the following new paragraph:
            ``(5) Special rules for computer donation credit.--
                    ``(A) In general.--In the case of the computer 
                donation credit--
                            ``(i) this section and section 39 shall be 
                        applied separately with respect to the credit, 
                        and
                            ``(ii) in applying paragraph (1) to the 
                        credit--
                                    ``(I) subparagraph (A) thereof 
                                shall not apply, and
                                    ``(II) the limitation under 
                                paragraph (1) (as modified by subclause 
                                (I)) shall be reduced by the credit 
                                allowed under subsection (a) for the 
                                taxable year (other than the computer 
                                donation credit).
                    ``(B) Computer donation credit.--For purposes of 
                this subsection, the term `computer donation credit' 
                means the credit allowable under subsection (a) by 
                reason of section 45H(a).''.
            (2) Conforming amendment.--Subclause (II) of section 
        38(c)(2)(A)(ii) is amended by inserting ``or the computer 
        donation credit'' after ``the new energy efficient home 
        credit''.
    (d) Limitation on Carryback.--Subsection (d) of section 39 is 
amended by adding at the end thereof the following new paragraph:
            ``(12) No carryback of computer donation credit before 
        effective date.--No portion of the unused business credit for 
        any taxable year which is attributable to the credit determined 
        under section 45H may be carried back to any taxable year 
        ending before the date of the enactment of section 45H.''.
    (e) Deduction for Certain Unused Business Credits.--Subsection (c) 
of section 196 is amended by striking ``and'' at the end of paragraph 
(9), by striking the period at the end of paragraph (10) and inserting 
``, and'', and by adding after paragraph (10) the following new 
paragraph:
            ``(11) the computer donation credit determined under 
        section 45H.''.
    (f) Denial of Double Benefit.--Section 280C is amended by adding at 
the end thereof the following new subsection:
    ``(e) Credit for Qualified Computer Technology Donations.--No 
deduction shall be allowed for that portion of the donations referred 
to in section 45H(c)(1) otherwise allowable as a deduction for the 
taxable year which is equal to the amount of the credit determined for 
such taxable year under section 45H(a).''.
    (g) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter (A) of chapter 1 is amended by adding at the end 
the following new item:

``Sec. 45H. Donation of computer technology and equipment to elementary 
                            and secondary schools.''.
    (h) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.
                                 <all>