HR 4279 IH

To amend the Internal Revenue Code of 1986 to allow all computers to be expensed.

April 13, 2000

Mr. WELLER (for himself, Mr. DAVIS of Virginia, Mr. TAUZIN, Ms. DUNN, Mr. GOODLATTE, Mrs. MORELLA, Mr. CHAMBLISS, Mr. SWEENEY, and Mr. ISAKSON) introduced the following bill; which was referred to the Committee on Ways and Means

To amend the Internal Revenue Code of 1986 to allow all computers to be expensed.

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 `Computer Depreciation Reform Act of 2000'.

SEC. 2. EXPENSING OF COMPUTERS.

(a) IN GENERAL- Part VI of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 179A the following new section:

`SEC. 179B. DEDUCTION FOR COMPUTERS.

`(a) ALLOWANCE OF DEDUCTION- There shall be allowed as a deduction an amount equal to the cost of any computer (to which section 168 applies) which is placed in service during the taxable year and which is for use in the active conduct of a trade or business.

`(b) COMPUTER- For purposes of this section, the term `computer' means any computer or peripheral equipment (as defined in section 168(i)(2)(B)).

`(c) BASIS REDUCTION- For purposes of this title, the basis of any computer shall be reduced by the cost of such computer taken into account under subsection (a).

`(d) BUSINESS USE REQUIRED FOR AT LEAST 1 YEAR- The Secretary shall, by regulations, provide for recapturing the benefit under any deduction allowable under subsection (a) with respect to any computer which is not used predominantly in a trade or business at any time during the 1-year period beginning on the date that the computer is placed in service.'

(b) CONFORMING AMENDMENTS-

(1) Paragraph (1) of section 263(a) of such Code is amended by striking `or' at the end of subparagraph (G), by striking the period at the end of subparagraph (H) and inserting `, or', and by adding at the end the following new subparagraph:

`(I) expenditures for which a deduction is allowed under section 179B.'

(2) Subparagraph (B) of section 312(k)(3) of such Code is amended by striking `or 179A' each place it appears and inserting `, 179A, or 179B'.

(3) Subsection (a) of section 1016 of such Code is amended by striking `and' at the end of paragraph (26), by striking the period at the end of paragraph (27) and inserting `, and', and by adding at the end the following new paragraph:

`(28) to the extent provided in section 179A(c).'

(c) EFFECTIVE DATE- The amendments made by this section shall apply to computers purchased after the date of the enactment of this Act.

END