[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[S. 3818 Introduced in Senate (IS)]

111th CONGRESS
  2d Session
                                S. 3818

  To amend the Internal Revenue Code of 1986 to allow credits for the 
               establishment of franchises with veterans.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           September 22, 2010

   Mr. Casey 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 credits for the 
               establishment of franchises with veterans.

    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 ``Help Veterans Own Franchises Act''.

SEC. 2. VETERANS FRANCHISING CREDIT.

    (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. 45S. VETERANS FRANCHISING.

    ``(a) Franchisor Veterans Discount Credit.--
            ``(1) In general.--For purposes of section 38, the 
        franchisor veterans discount credit determined under this 
        section for the taxable year is an amount equal to 50 percent 
        of the qualified franchise fee discount provided by the 
        taxpayer during the taxable year.
            ``(2) Limitation.--The amount allowed as a credit under 
        paragraph (1) with respect to the purchase of any franchise 
        shall not exceed $25,000.
    ``(b) Veterans Franchise Fee Credit.--
            ``(1) In general.--For purposes of section 38, the veterans 
        franchise fee credit determined under this section for the 
        taxable year is an amount equal to 25 percent of the qualified 
        franchise fee paid or incurred by the taxpayer in connection 
        with the purchase of a franchise in which a qualified franchise 
        fee discount is offered by the franchisor.
            ``(2) Limitation.--For purposes of paragraph (1), the 
        amount of franchise fees taken into account under paragraph (1) 
        in connection with a franchise shall not exceed $100,000.
    ``(c) Reduction Where Franchise Not 100 Percent Veteran-Owned.--In 
the case of any franchise in which veterans do not own 100 percent of 
the stock or of the capital or profits interests of the franchisee, the 
credits under subsections (a) and (b) shall be the credit amount 
determined under each such subsection, multiplied by the same ratio 
as--
            ``(1) the stock or capital or profits interests of the 
        franchise held by veterans, bears
            ``(2) to the total stock or capital or profits interests of 
        the franchisee.
For purposes of this subsection, the spouse of a veteran shall be 
treated as a veteran.
    ``(d) Qualified Franchise Fee Discount.--For purposes of this 
section, the term `qualified franchise fee discount' means with respect 
to a franchise arrangement--
            ``(1) the amount of the franchise fee offer listed in the 
        most recent franchise disclosure document of the franchisor, 
        over
            ``(2) the qualified franchise fee actually paid.
    ``(e) Qualified Franchise Fee.--For purposes of this section, the 
term `qualified franchise fee' means any one-time fee required by the 
franchisor when entering into a franchise with a qualified veteran.
    ``(f) Other Definitions.--For purposes of this section, the terms 
`franchise', `franchisee', `franchisor', `franchise fee', and 
`franchise disclosure document' have the meanings given such terms in 
part 436 of title 16, Code of Federal Regulations (as in effect on 
January 1, 2010).
    ``(g) Veteran.--The term `veteran' has the meaning given such term 
by section 101 of title 38, United States Code.
    ``(h) Election.--This section shall not apply to a taxpayer for any 
taxable year if such taxpayer elects to have this section not apply for 
such taxable year.''.
    (b) Credit To Be Part of General Business Credit.--Section 38(b) of 
the Internal Revenue Code of 1986 is amended by striking ``plus'' at 
the end of paragraph (35), by striking the period at the end of 
paragraph (36) and inserting a comma, and by adding at the end the 
following new paragraphs:
            ``(37) the franchisor veterans discount credit determined 
        under section 45S(a), plus
            ``(38) the veterans franchise fee credit determined under 
        section 45S(b).''.
    (c) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by adding at the end the following new item:

``Sec. 45S. Veterans franchising.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after December 31, 2009.

SEC. 3. PUBLICATION OF INFORMATION BY DEPARTMENT OF VETERANS AFFAIRS 
              AND SMALL BUSINESS ADMINISTRATION.

    The Administrator of the Small Business Administration and the 
Secretary of Veterans Affairs shall publicize in mailings and brochures 
sent to veterans service organizations and veteran advocacy groups 
information regarding discounted franchise fees under section 45S of 
the Internal Revenue Code of 1986 and other information about the 
program established under amendments made by this Act.
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