[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4174 Introduced in House (IH)]

111th CONGRESS
  1st Session
                                H. R. 4174

   To amend the Internal Revenue Code of 1986 to provide relief with 
  respect to estate and gift taxes, small businesses, and government 
                              contractors.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            December 2, 2009

   Mr. Nye 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 relief with 
  respect to estate and gift taxes, small businesses, and government 
                              contractors.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Tax Relief for 
Business Growth and Sustainability Act of 2009''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.
                  TITLE I--ESTATE AND GIFT TAX REFORM

Sec. 101. Repeal of carryover basis; increased exclusion amount; 
                            maximum 35 percent rate.
Sec. 102. Increase in deduction for family-owned businesses.
Sec. 103. Exclusion from gross estate of value of principal residence.
              TITLE II--TREATMENT OF SMALL BUSINESS STOCK

Sec. 201. Full exclusion from gross income of gain from qualified small 
                            business stock.
Sec. 202. Repeal of alternative minimum tax treatment of qualified 
                            small business stock gain as item of tax 
                            preference.
              TITLE III--RELIEF FOR GOVERNMENT CONTRACTORS

Sec. 301. Repeal of withholding tax on government contractors.

                  TITLE I--ESTATE AND GIFT TAX REFORM

SEC. 101. REPEAL OF CARRYOVER BASIS; INCREASED EXCLUSION AMOUNT; 
              MAXIMUM 35 PERCENT RATE.

    (a) EGTRRA Sunset Not To Apply.--Section 901 of the Economic Growth 
and Tax Relief Reconciliation Act of 2001 shall not apply to title V of 
such Act (other than subtitles A and E, and sections 511(d) and 
521(b)(2), thereof).
    (b) $5,000,000 Applicable Exclusion Amount.--Subsection (c) of 
section 2010 of the Internal Revenue Code of 1986 is amended by 
striking all that follows ``the applicable exclusion amount'' and 
inserting ``. For purposes of the preceding sentence, the applicable 
exclusion amount is $5,000,000.''.
    (c) Maximum Estate and Gift Tax Rate 35 Percent.--Paragraph (1) of 
section 2001(c) of such Code is amended by striking the last 7 items in 
the table and inserting the following new item:


``Over $500,000..............................  $155,800, plus 35 percent of the excess of such amount over
                                                $500,000.''.
 

    (d) Effective Date.--The amendments made by this section shall 
apply to estates of decedents dying, and gifts made, after December 31, 
2010.

SEC. 102. INCREASE IN DEDUCTION FOR FAMILY-OWNED BUSINESSES.

    (a) In General.--
            (1) Increase.--Paragraph (2) of section 2057(a) of the 
        Internal Revenue Code of 1986 is amended by striking 
        ``$675,000'' and inserting ``$5,000,000''.
            (2) Allowed in addition to applicable credit amount.--
        Subsection (a) of section 2057 of such Code is amended by 
        striking paragraph (3).
    (b) Effective Date.--The amendments made by this section shall 
apply to estates of decedents dying, and gifts made, after December 31, 
2010.

SEC. 103. EXCLUSION FROM GROSS ESTATE OF VALUE OF PRINCIPAL RESIDENCE.

    (a) In General.--Subchapter A of chapter 11 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new section:

``SEC. 2059. PRINCIPAL RESIDENCE.

    ``(a) In General.--For purposes of the tax imposed by section 2001, 
in the case of a decedent who was (at the date of the decedent's death) 
a citizen or resident of the United States, the value of the taxable 
estate shall be determined by deducting from the value of the gross 
estate the adjusted value of any residence if--
            ``(1) such residence is included in determining the value 
        of the gross estate,
            ``(2) such residence is located in the United States, and
            ``(3) during the 8-year period ending on the date of the 
        decedent's death, there have been periods aggregating 5 years 
        during which such residence was owned by the decedent or a 
        member of the decedent's family and used by the decedent or 
        such a member as their principal residence (within the meaning 
        of section 121).
    ``(b) Limitation.--The deduction allowed by this section shall not 
exceed $2,000,000.
    ``(c) Adjusted Value.--For purposes of this section, the adjusted 
value of property is the value of such property for purposes of this 
chapter, reduced by amounts allowable as a deduction in respect to such 
property under paragraph (4) of section 2053(a).''.
    (b) Clerical Amendment.--The table of sections for subchapter A of 
chapter 11 of such Code is amended by adding at the end the following 
new item:

``Sec. 2059. Principal residence.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to estates of decedents dying, and gifts made, after December 31, 
2010.

              TITLE II--TREATMENT OF SMALL BUSINESS STOCK

SEC. 201. FULL EXCLUSION FROM GROSS INCOME OF GAIN FROM QUALIFIED SMALL 
              BUSINESS STOCK.

    (a) In General.--Paragraph (1) of section 1202(a) of the Internal 
Revenue Code of 1986 is amended by striking ``50 percent of''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2008.

SEC. 202. REPEAL OF ALTERNATIVE MINIMUM TAX TREATMENT OF QUALIFIED 
              SMALL BUSINESS STOCK GAIN AS ITEM OF TAX PREFERENCE.

    (a) In General.--Subsection (a) of section 57 of the Internal 
Revenue Code of 1986 is amended by striking paragraph (7).
    (b) Conforming Amendment.--Subclause (II) of section 
53(d)(1)(B)(ii) of such Code is amended by striking ``, (5), and (7)'' 
and inserting ``and (5)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2008.

              TITLE III--RELIEF FOR GOVERNMENT CONTRACTORS

SEC. 301. REPEAL OF WITHHOLDING TAX ON GOVERNMENT CONTRACTORS.

    Section 3402 of the Internal Revenue Code of 1986 is amended by 
striking subsection (t).
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