[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 1613 Introduced in Senate (IS)]







108th CONGRESS
  1st Session
                                S. 1613

  To amend the Internal Revenue Code of 1986 to allow a United States 
        independent film and television production wage credit.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           September 11, 2003

Mrs. Lincoln (for herself, Ms. Snowe, Mr. Reid, Mr. Smith, Mr. Breaux, 
Mr. Ensign, Mr. Durbin, Mr. Cochran, Mr. Leahy, Ms. Collins, Mr. Graham 
  of South Carolina, Mr. Daschle, Mrs. Boxer, Mr. Kennedy, Mr. Kerry, 
Mrs. Feinstein, Mr. Bingaman, Ms. Landrieu, and Mr. Schumer) 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 allow a United States 
        independent film and television production wage credit.

    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 ``United States Independent Film and 
Television Production Incentive Act of 2003''.

SEC. 2. TAX INCENTIVES FOR QUALIFIED UNITED STATES INDEPENDENT FILM AND 
              TELEVISION PRODUCTION.

    (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 new section:

``SEC. 45G. UNITED STATES INDEPENDENT FILM AND TELEVISION PRODUCTION 
              WAGE CREDIT.

    ``(a) Amount of Credit.--For purposes of section 38, the United 
States independent film and television production wage credit 
determined under this section with respect to any eligible taxpayer for 
any taxable year is an amount equal to 25 percent of the qualified 
wages paid or incurred per qualified United States independent film and 
television production during such taxable year.
    ``(b) Only First $25,000 of Wages per Production Taken Into 
Account.--With respect to each qualified United States independent film 
and television production, the amount of qualified wages paid or 
incurred to each qualified employee or personal service corporation 
which may be taken into account per such production shall not exceed 
$25,000.
    ``(c) Eligible Taxpayer.--For purposes of this section, the term 
`eligible taxpayer' means any taxpayer substantially all of the total 
gross income of which for the taxable year is derived from the active 
conduct of qualified United States independent film and television 
productions.
    ``(d) Qualified Wages.--For purposes of this section--
            ``(1) In general.--The term `qualified wages' means--
                    ``(A) any wages paid or incurred by an employer for 
                services performed in the United States by an employee 
                while such employee is a qualified employee,
                    ``(B) the employee fringe benefit expenses of the 
                employer allocable to such services performed by such 
                employee,
                    ``(C) any payments made to personal service 
                corporations as defined in section 269A(b)(1) for 
                services performed in the United States, and
                    ``(D) remuneration, other than wages, for services 
                personally rendered in the United States.
            ``(2) Qualified employee.--
                    ``(A) In general.--The term `qualified employee' 
                means, with respect to any period, any individual who 
                renders personal services if substantially all of such 
                services are performed during such period in an 
                activity related to any qualified United States 
                independent film and television production.
                    ``(B) Certain individuals not eligible.--Such term 
                shall not include--
                            ``(i) any individual described in 
                        subparagraph (A), (B), or (C) of section 
                        51(i)(1), and
                            ``(ii) any 5-percent owner (as defined in 
                        section 416(i)(1)(B)).
            ``(3) Coordination with other wage credits.--No credit 
        shall be allowed under any other provision of this chapter for 
        wages paid to any employee during any taxable year if the 
        employer is allowed a credit under this section for any of such 
        wages.
            ``(4) Wages.--The term `wages' has the same meaning as when 
        used in section 51.
            ``(5) Employee fringe benefit expenses.--The term `employee 
        fringe benefit expenses' means the amount allowable as a 
        deduction under this chapter to the employer for any taxable 
        year with respect to--
                    ``(A) employer contributions under stock bonus, 
                pension, profit-sharing, or annuity plan,
                    ``(B) employer-provided coverage under any accident 
                or health plan for employees, and
                    ``(C) the cost of life or disability insurance 
                provided to employees.
        Any amount treated as wages under paragraph (1)(A) shall not be 
        taken into account under this subparagraph.
    ``(e) Qualified United States Independent Film and Television 
Production.--For purposes of this section--
            ``(1) In general.--The term `qualified United States 
        independent film and television production' means any 
        production described in paragraph (2) if--
                    ``(A) 75 percent of the total wages of the 
                production are qualified wages,
                    ``(B) the production is created primarily for use 
                as public entertainment or for educational purposes, 
                and
                    ``(C) the total cost of the production which is 
                taken into account for purposes of depreciation under 
                section 167(g) is more than $200,000 but less than 
                $7,500,000.
            ``(2) Production.--
                    ``(A) In general.--A production is described in 
                this paragraph if such production is--
                            ``(i) any motion picture (whether released 
                        theatrically, for television or cable 
                        programming, or directly to video cassette or 
                        disc or any other format),
                            ``(ii) any television or cable--
                                    ``(I) mini series,
                                    ``(II) season of an episodic 
                                television series,
                                    ``(III) movie of the week, or
                                    ``(IV) single program not described 
                                in any preceding subclause, or
                            ``(iii) any pilot production for any of the 
                        productions described in clause (i) or (ii).
                    ``(B) Exception.--A production is not described in 
                this paragraph if records are required under section 
                2257 of title 18, United States Code, to be maintained 
                with respect to any performer in such production 
                (reporting of books, films, etc. with sexually explicit 
                conduct).
            ``(3) Public entertainment.--The term `public 
        entertainment' includes a motion picture film, video tape, or 
        television program intended for initial broadcast via the 
        public broadcast spectrum or delivered via cable distribution, 
        or productions that are submitted to a national organization in 
        existence on July 27, 2001, that rates films for violent or 
        adult content. Such term does not include any film or tape the 
        market for which is primarily topical, is otherwise essentially 
        transitory in nature, or is produced for private noncommercial 
        use.
    ``(f) Controlled Groups.--For purposes of this section--
            ``(1) all employers treated as a single employer under 
        subsection (a) or (b) of section 52 shall be treated as a 
        single employer for purposes of this subpart, and
            ``(2) the credit (if any) determined under this section 
        with respect to each such employer shall be its proportionate 
        share of the wages giving rise to such credit.
    ``(g) Application of Certain Other Rules.--For purposes of this 
section, rules similar to the rules of section 51(k) and subsections 
(c) and (d) of section 52 shall apply.
    ``(h) Election To Have Credit Not Apply.--
            ``(1) In general.--A taxpayer may elect to have this 
        section not apply for any taxable year.
            ``(2) Manner of making election.--An election under 
        paragraph (1) (or revocation thereof) shall be made in such 
        manner as the Secretary may by regulations prescribe.''.
    (b) Credit Treated as Business Credit.--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 (14), 
by striking the period at the end of paragraph (15) and inserting ``, 
plus'', and by adding at the end the following new paragraph:
            ``(16) the United States independent film and television 
        production wage credit determined under section 45G(a).''.
    (c) No Carrybacks.--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:
            ``(11) No carryback of section 45g credit before effective 
        date.--No portion of the unused business credit for any taxable 
        year which is attributable to the United States independent 
        film and television production wage credit determined under 
        section 45G may be carried back to a taxable year ending before 
        January 1, 2004.''.
    (d) Denial of Double Benefit.--Subsection (a) of section 280C of 
the Internal Revenue Code of 1986 (relating to certain expenses for 
which credits are available) is amended by inserting ``45G(a),'' after 
``45A(a),''.
    (e) Conforming Amendments.--
            (1) Section 6501(m) of the Internal Revenue Code of 1986 is 
        amended by inserting ``45G(h),'' after ``45C(d)(4),''.
            (2) The table of sections for subpart D of part IV of 
        subchapter A of chapter 1 of such Code is amended by adding at 
        the end the following new item:

                              ``Sec. 45G. United States independent 
                                        film and television production 
                                        wage credit.''.
    (f) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred in taxable years ending after 
December 31, 2003.
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