[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2981 Introduced in House (IH)]







107th CONGRESS
  1st Session
                                H. R. 2981

   To amend the Internal Revenue Code of 1986 to establish a 2-year 
 recovery period for depreciation of computers and other technological 
    equipment, a 24-month useful life for depreciation of computer 
software, and a 7-year useful life for depreciation of certain auction-
                 acquired telecommunications licenses.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 2, 2001

Mr. Upton (for himself, Mr. Green of Texas, Mr. Burr of North Carolina, 
  Mr. Gillmor, Mr. Tauzin, Mr. Stearns, Mr. Greenwood, Mr. Barton of 
  Texas, Ms. Harman, Mr. Camp, Mr. Armey, Mr. Ramstad, Mr. Bass, Mr. 
  Bilirakis, Mr. LaHood, Mr. Radanovich, Mr. Smith of New Jersey, Mr. 
 Sessions, Mr. Portman, Mr. Boehner, Mr. Whitfield, Mr. Hoekstra, Mr. 
Ose, Mr. Boehlert, Mr. Boucher, Mr. Goodlatte, Mrs. Kelly, Ms. Pryce of 
 Ohio, Mr. Dreier, Ms. Dunn of Washington, Mr. Foley, Mr. Tom Davis of 
Virginia, Mrs. Bono, Mr. DeLay, Mr. Watts of Oklahoma, and Mr. Shimkus) 
 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 establish a 2-year 
 recovery period for depreciation of computers and other technological 
    equipment, a 24-month useful life for depreciation of computer 
software, and a 7-year useful life for depreciation of certain auction-
                 acquired telecommunications licenses.

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

SECTION 1. 2-YEAR APPLICABLE RECOVERY PERIOD FOR DEPRECIATION OF 
              COMPUTERS AND OTHER TECHNOLOGICAL EQUIPMENT.

    (a) 2-Year Applicable Recovery Period for Qualified Technological 
Equipment.--
            (1) In general.--Paragraph (1) of section 168(c) of the 
        Internal Revenue Code of 1986 (relating to applicable recovery 
        period) is amended by inserting before the first item in the 
        table the following new item:

  ``Qualified technological equipment................        2 years''.
            (2) Conforming amendment.--Section 168(e)(3)(B) of such 
        Code (relating to 5-year property) is amended by striking 
        clause (iv).
    (b) 2-Year Recovery Period Under Alternative Depreciation System 
for Tax-Exempt Use Property, Etc.--Subparagraph (C) of section 
168(g)(3) of such Code (relating to alternative depreciation system for 
certain property) is amended by striking ``5 years'' and inserting ``2 
years''.
    (c) Definition of Qualified Technological Equipment.--
            (1) In general.--Subparagraph (A) of section 168(i)(2) of 
        such Code is amended by striking ``and'' at the end of clause 
        (ii), by striking the period at the end of clause (iii) and 
        inserting a comma, and by adding at the end the following:
                            ``(iv) any wireless telecommunications 
                        equipment,
                            ``(v) any advanced services equipment, and
                            ``(vi) any network or network system 
                        equipment.
            (2) Wireless telecommunications equipment, etc.--Paragraph 
        (2) of section 168(i) of such Code is amended by adding at the 
        end the following:
                    ``(D) Wireless telecommunications equipment.--The 
                term `wireless telecommunications equipment' means all 
                equipment (other than towers, buildings, and T-1 lines 
                (cabling)) used in the transmission, reception, 
                coordination, or switching of wireless 
                telecommunications service. For this purpose, `wireless 
                telecommunications service' includes any commercial 
                mobile radio service as defined in title 47 of the Code 
                of Federal Regulations.
                    ``(E) Advanced services equipment.--The term 
                `advanced services equipment' means equipment, 
                excluding cabling, used in the provision of Internet or 
                electronic communications access services or support, 
                or which supports access to electronic media and data 
                and associated communications support, provided that 
                such services or support constitute or directly 
                contribute to the provision of advanced 
                telecommunications capability as that term is defined 
                in section 706(c)(1) of the Telecommunications Act of 
                1996.
                    ``(F) Network or network system equipment.--The 
                term `network or network system equipment' means any 
                information technology equipment, including computer 
                servers, hubs, bridges, switches, and routers, which 
                are interconnected so as to enable computers and 
                peripherals to communicate with each other either 
                individually or as a single unit.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act.

SEC. 2. 24-MONTH USEFUL LIFE FOR DEPRECIATION OF COMPUTER SOFTWARE.

    (a) In General.--Subparagraph (A) of section 167(f)(1) of the 
Internal Revenue Code of 1986 (relating to computer software) is 
amended by striking ``36 months'' and inserting ``24 months''.
    (b) Effective Date.--The amendment made by this section shall apply 
to property placed in service after the date of the enactment of this 
Act.

SEC. 3. 7-YEAR USEFUL LIFE FOR DEPRECIATION OF CERTAIN AUCTION-ACQUIRED 
              TELECOMMUNICATIONS LICENSES.

    (a) 7-Year Useful Life.--Section 167 of the Internal Revenue Code 
of 1986 (relating to depreciation) is amended by redesignating 
subsection (h) as subsection (i) and by inserting after subsection (g) 
the following new subsection:
    ``(h) Treatment of Certain Auction-Acquired Telecommunications 
Licenses Excluded From Section 197.--
            ``(1) In general.--If a depreciation deduction is allowable 
        under subsection (a) with respect to an auction-acquired 
        telecommunications license, such deduction shall be computed by 
        using the straight line method and a useful life of 7 years.
            ``(2) Auction-acquired telecommunications license.--For 
        purposes of this subsection, the term `auction-acquired 
        telecommunications license' means any license granted through a 
        competitive bidding system under section 309(j) of the 
        Communications Act of 1934 (47 U.S.C. 309(j)).
    (b) Exclusion From Section 197.--Subparagraph (D) of section 
197(d)(1) of such Code (defining section 197 intangible) is amended by 
inserting before the comma the following: ``(other than an auction-
acquired telecommunications license (as defined in section 167(h)) with 
respect to which a depreciation deduction is allowable under section 
167(a))''.
    (c) Effective Date.--The amendments made by this section shall 
apply to property placed in service after the date of the enactment of 
this Act.
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