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Internal Revenue Code, § 280C. Certain Expenses For Which Credits Are Allowable

I.R.C. § 280C(a) Rule For Employment Credits
No deduction shall be allowed for that portion of the wages or salaries paid or incurred for the taxable year which is equal to the sum of the credits determined for the taxable year under sections 45A(a), 45P(a), 45S(a), 51(a), and 1396(a). In the case of a corporation which is a member of a controlled group of corporations (within the meaning of section 52(a)) or a trade or business which is treated as being under common control with other trades or businesses (within the meaning of section 52(b)), this subsection shall be applied under rules prescribed by the Secretary similar to the rules applicable under subsections (a) and (b) of section 52.
I.R.C. § 280C(b) Credit For Qualified Clinical Testing Expenses For Certain Drugs
I.R.C. § 280C(b)(1) In General
No deduction shall be allowed for that portion of the qualified clinical testing expenses (as defined in section 45C(b)) otherwise allowable as a deduction for the taxable year which is equal to the amount of the credit allowable for the taxable year under section 45C (determined without regard to section 38(c)).
I.R.C. § 280C(b)(2) Similar Rule Where Taxpayer Capitalizes Rather Than Deducts Expenses
If—
I.R.C. § 280C(b)(2)(A)
the amount of the credit allowable for the taxable year under section 45C (determined without regard to section 38(c)), exceeds
I.R.C. § 280C(b)(2)(B)
the amount allowable as a deduction for the taxable year for qualified clinical testing expenses (determined without regard to paragraph (1)),
the amount chargeable to capital account for the taxable year for such expenses shall be reduced by the amount of such excess.
I.R.C. § 280C(b)(3) Election Of Reduced Credit
I.R.C. § 280C(b)(3)(A) In General
In the case of any taxable year for which an election is made under this paragraph—
I.R.C. § 280C(b)(3)(A)(i)
paragraphs (1) and (2) shall not apply, and
I.R.C. § 280C(b)(3)(A)(ii)
the amount of the credit under section 45C(a) shall be the amount determined under subparagraph (B).
I.R.C. § 280C(b)(3)(B) Amount Of Reduced Credit
The amount of credit determined under this subparagraph for any taxable year shall be the amount equal to the excess of—
I.R.C. § 280C(b)(3)(B)(i)
the amount of credit determined under section 45C(a) without regard to this paragraph, over
I.R.C. § 280C(b)(3)(B)(ii)
the product of—
I.R.C. § 280C(b)(3)(B)(ii)(I)
the amount described in clause (i), and
I.R.C. § 280C(b)(3)(B)(ii)(II)
the maximum rate of tax under section 11(b).
I.R.C. § 280C(b)(3)(B)(C) Election
An election under this paragraph for any taxable year shall be made not later than the time for filing the return of tax for such year (including extensions), shall be made on such return, and shall be made in such manner as the Secretary shall prescribe. Such an election, once made, shall be irrevocable.
I.R.C. § 280C(b)(4) Controlled Groups
In the case of a corporation which is a member of a controlled group of corporations (within the meaning of section 41(f)(5)) or a trade or business which is treated as being under common control with other trades or business (within the meaning of section 41(f)(1)(B)), this subsection shall be applied under rules prescribed by the Secretary similar to the rules applicable under subparagraphs (A) and (B) of section 41(f)(1).
I.R.C. § 280C(c) Credit For Increasing Research Activities
I.R.C. § 280C(c)(1) In General
If—
I.R.C. § 280C(c)(1)(A)
the amount of the credit determined for the taxable year under section 41(a)(1), exceeds
I.R.C. § 280C(c)(1)(B)
the amount allowable as a deduction for such taxable year for qualified research expenses or basic research expenses,
the amount chargeable to capital account for the taxable year for such expenses shall be reduced by the amount of such excess.
I.R.C. § 280C(c)(2) Election Of Reduced Credit
I.R.C. § 280C(c)(2)(A) In General
In the case of any taxable year for which an election is made under this paragraph—
I.R.C. § 280C(c)(2)(A)(i)
paragraph (1) shall not apply, and
I.R.C. § 280C(c)(2)(A)(ii)
the amount of the credit under section 41(a) shall be the amount determined under subparagraph (B).
I.R.C. § 280C(c)(2)(B) Amount Of Reduced Credit
The amount of credit determined under this subparagraph for any taxable year shall be the amount equal to the excess of—
I.R.C. § 280C(c)(2)(B)(i)
the amount of credit determined under section 41(a) without regard to this paragraph, over
I.R.C. § 280C(c)(2)(B)(ii)
the product of—
I.R.C. § 280C(c)(2)(B)(ii)(I)
the amount described in clause (i), and
I.R.C. § 280C(c)(2)(B)(ii)(II)
the maximum rate of tax under section 11(b).
I.R.C. § 280C(c)(2)(C) Election
An election under this paragraph for any taxable year shall be made not later than the time for filing the return of tax for such year (including extensions), shall be made on such return, and shall be made in such manner as the Secretary may prescribe. Such an election, once made, shall be irrevocable.
I.R.C. § 280C(c)(3) Controlled Groups
Paragraph (3) of subsection (b) shall apply for purposes of this subsection.
I.R.C. § 280C(d) Credit For Low Sulfur Diesel Fuel Production
The deductions otherwise allowed under this chapter for the taxable year shall be reduced by the amount of the credit determined for the taxable year under section 45H(a).
I.R.C. § 280C(e) Mine Rescue Team Training Credit
No deduction shall be allowed for that portion of the expenses otherwise allowable as a deduction for the taxable year which is equal to the amount of the credit determined for the taxable year under section 45N(a).
I.R.C. § 280C(f) Credit For Security Of Agricultural Chemicals
No deduction shall be allowed for that portion of the expenses otherwise allowable as a deduction taken into account in determining the credit under section 45O for the taxable year which is equal to the amount of the credit determined for such taxable year under section 45O(a).
I.R.C. § 280C(g) Credit For Health Insurance Premiums
No deduction shall be allowed for the portion of the premiums paid by the taxpayer for coverage of 1 or more individuals under a qualified health plan which is equal to the amount of the credit determined for the taxable year under section 36B(a) with respect to such premiums.
I.R.C. § 280C(h) Credit For Employee Health Insurance Expenses Of Small Employers
No deduction shall be allowed for that portion of the premiums for qualified health plans (as defined in section 1301(a) of the Patient Protection and Affordable Care Act), or for health insurance coverage in the case of taxable years beginning in 2010, 2011, 2012, or 2013, paid by an employer which is equal to the amount of the credit determined under section 45R(a) with respect to the premiums.
(Added Pub. L. 95-30, title II, Sec. 202(c)(1), May 23, 1977, 91 Stat. 147, and amended Pub. L. 95-600, title III, Sec. 322(d)(1), Nov. 6, 1978, 92 Stat. 2838; Pub. L. 96-178, Sec. 6(c)(4), Jan. 2, 1980, 93 Stat. 1298; Pub. L. 96-222, title I, Sec. 103(a)(7)(D)(iv), Apr. 1, 1980, 94 Stat. 212; Pub. L. 97-414, Sec. 4(b)(1), (2)(A), Jan. 4, 1983, 96 Stat. 2055; Pub. L. 98-369, div. A, title IV, Sec. 474(r)(10), July 18, 1984, 98 Stat. 841; Pub. L. 99-514, title II, Sec. 231(d)(3)(E), title XVIII, Sec. 1847(b)(8), Oct. 22, 1986, 100 Stat. 2179, 2856; Pub. L. 100-647, title IV, Sec. 4008(a), Nov. 10, 1988, 102 Stat. 3652; Pub. L. 101-239, title VII, Sec. 7110(c)(1), 7814(e)(2)(A), Dec. 19, 1989, 103 Stat. 2325, 2413; Pub. L. 103-66, title XIII, Sec. 13302(b), 13322(c), Aug. 10, 1993; Pub. L. 104-188, title I, Sec. 1205(d)(7), Aug. 20, 1996, 110 Stat. 1755; Pub. L. 106-170, title V, Sec. 502(c), Dec. 17, 1999, 113 Stat 1860; Pub. L. 106-554, Sec. 311, Dec. 21, 2000, 114 Stat. 2763; Pub. L. 108-357, title III, Sec. 339(c), Oct. 22, 2004, 118 Stat. 1418; Pub. L. 109-135, title I, II, Sec. 103(b)(2), 201(b)(2), Dec. 21, 2005, 119 Stat. 2577; Pub. L. 109-432, div. A, title IV, Sec. 405(c), Dec. 20, 2006, 120 Stat. 2922; Pub. L. 110-172, Sec. 7(a)(1)(B), Dec. 29, 2007, 121 Stat. 2473; Pub. L. 110-245, Sec. 111(c), June 17, 2008, 122 Stat. 1624; Pub. L. 110-246, title XV, Sec. 15343(e), June 18, 2008, 122 Stat. 1651; Pub. L. 111-148, Sec. 1401(b), 1421(d)(1), 9023(c)(2), 10105(e)(3), Mar. 23, 2010, 124 Stat. 119; Pub. L. 115-97, Sec. 13001(b)(1)(A), 13401(b), 13403(d)(1), 13206(d)(2), Dec. 22, 2017, 131 Stat. 2054; Pub. L. 115-141, Div. U, title IV, Sec. 401(a)(62), (d)(3)(B)(iii), (d)(6)(B)(iv), Mar. 23, 2018, 132 Stat. 348.)
BACKGROUND NOTES
AMENDMENTS
2018 - Subsec. (a). Pub. L. 115-141, Div. U, Sec. 401(a)(62), amended subsec. (a) by substituting “1396(a)” for “and 1396(a)”.
Subsec. (a). Pub. L. 115-141, Div. U, Sec. 401(d)(6)(B)(iv), amended subsec. (a) by substituting “and 1396(a)” for “1396(a), 1400P(b), and 1400R”.
Subsec (g). Pub. L. 115-141, Div. U, Sec. 401(d)(3)(B)(iii), amended Sec. 280C by striking the subsec. (g) which related to the qualifying therepeutic discovery project credit.
Before being struck, subsec. (g) read as follows:
“(g) Qualifying Therapeutic Discovery Project Credit
“(1) In General. -- No deduction shall be allowed for that portion of the qualified investment (as defined in section 48D(b)) otherwise allowable as a deduction for the taxable year which—
“(A) would be qualified research expenses (as defined in section 41(b)), basic research expenses (as defined in section 41(e)(2)), or qualified clinical testing expenses (as defined in section 45C(b)) if the credit under section 41 or section 45C were allowed with respect to such expenses for such taxable year, and
“(B) is equal to the amount of the credit determined for such taxable year under section 48D(a), reduced by—
“(i) the amount disallowed as a deduction by reason of section 48D(e)(2)(B), and
“(ii) the amount of any basis reduction under section 48D(e)(1).
“(2) Similar Rule Where Taxpayer Capitalizes Rather Than Deducts Expenses. -- In the case of expenses described in paragraph (1)(A) taken into account in determining the credit under section 48D for the taxable year, if—
“(A) the amount of the portion of the credit determined under such section with respect to such expenses, exceeds
“(B) the amount allowable as a deduction for such taxable year for such expenses (determined without regard to paragraph (1)),
“the amount chargeable to capital account for the taxable year for such expenses shall be reduced by the amount of such excess.
“(3) Controlled Groups. -- Paragraph (3) of subsection (b) shall apply for purposes of this subsection.”
2017 - Subsec. (a). Pub. L. 115-97, Sec. 13403(d)(1), amended subsec. (a) by inserting “45S(a),” after “45P(a),”.
Subsec. (b)(3)-(4). Pub. L. 115-97, Sec. 13401(b), amended subsec. (b) by redesignating par. (3) as par. (4) and by adding a new par. (3).
Subsec. (c)(1). Pub. L. 115-97, Sec. 13206(d)(2)(A), amended par. (1). Before amendment, it read as follows:
“(1) In General.—If—
“(A) the amount of the credit determined for the taxable year under section 41(a)(1), exceeds
“(B) the amount allowable as a deduction for such taxable year for qualified research expenses or basic research expenses,
“the amount chargeable to capital account for the taxable year for such expenses shall be reduced by the amount of such excess.”
Subsec. (c)(2)-(4). Pub. L. 115-97, Sec. 13206(d)(2)(B) and (C), amended subsec. (c) by striking par. (2), and by redesignating pars. (3) and (4) as pars. (2) and (3), respectively. Before being struck, par. (2) read as follows:
“(2) Similar Rule Where Taxpayer Capitalizes Rather Than Deducts Expenses.—If—
“(A) the amount of the credit determined for the taxable year under section 41(a)(1), exceeds
“(B) the amount allowable as a deduction for such taxable year for qualified research expenses or basic research expenses (determined without regard to paragraph (1)),
“the amount chargeable to capital account for the taxable year for such expenses shall be reduced by the amount of such excess.”
Subsec. (c)(2)(B)(ii). Pub. L. 115-97, Sec. 13001(b)(1)(A), amended subclause (II) by substituting “section 11(b)” for “section 11(b)(1)”.
Subsec. (c)(2). Pub. L. 115-97, Sec. 13206(d)(2)(D), amended par. (2), as redesignated, by substituting “paragraph (1)” for “paragraphs (1) and (2)”.
2010 - Subsec. (g). Pub. L. 111-148, Sec. 1401(b), added subsec. (g).
Subsec. (g). Pub. L. 111-148, Sec. 9023(c)(2), added subsec. (g).
Subsec. (h). Pub. L. 111-148, Sec. 1421(d)(1), added subsec. (h).
Subsec. (h). Pub. L. 111-148, Sec. 10105(e)(3), amended subsec. (h) by substituting “2010, 2011” for “2011”.
2008 - Subsec. (f). Pub. L. 110-246, Sec. 15343(c), added subsec. (f).
Subsec. (a). Pub. L. 110-245, Sec. 111(c), amended subsec. (a) by inserting “45P(a),” after “45A(a),”.
2007 - Subsec. (d). Pub. L. 110-172, Sec. 7(a)(1)(B), amended subsec. (d). Before amendment, it read as follows:
“(d) Low Sulfur Diesel Fuel Production Credit-No deduction shall be allowed for that portion of the expenses otherwise allowable as a deduction for the taxable year which is equal to the amount of the credit determined for the taxable year under section 45H(a).
2006 - Subsec. (e). Pub. L. 109-432, Sec. 404(c), added subsec. (e).
2005 - Subsec. (a). Pub. L. 109-135, Sec. 103(b)(2), amended subsec. (a) by substituting “1396(a), and 1400P(b)” for “and 1396(a)”.
Subsec. (a). Pub. L. 109-135, Sec. 201(b)(2), amended subsec. (a) by substituting “1400P(b), and 1400R” for “and 1400P(b)”.
2004 - Subsec. (d). Pub. L. 108-357, Sec. 339(c), added subsec. (d).
2000 - Subsec. (c)(1). Pub. L. 106-554, Sec. 311(a)(1), amended par. (1) by striking “or credit” after “deduction” each place it appears.
1999 - Subsec. (c)(1). Pub. L. 106-170, Sec. 502(c)(2), amended par. (1) by adding “or credit” after “deduction” each place it appears.
1996 - Subsec. (b). Pub. L. 104-188, Sec. 1205(d)(7), amended subsection (b) by striking out “section 28(b)” in paragraph (1) and inserted “section 45C(b)”; “section 28” in paragraphs (1) and (2)(A) and inserted “section 45C”; and “subsection (d)(2)” in paragraphs (1) and (2)(A) and inserted “section 38(c)”.
1993 - Subsec. (a). Pub. L. 103-66, Sec. 13322(c)(1), amended subsec. (a) by substituting “45A(a), 51(a), and” for “51(a)”.
Subsec. (a). Pub. L. 103-66, Sec. 13302(b)(1), amended subsec. (a) by substituting “the sum of the credits determined for the taxable year under sections 51(a) and 1396(a)” for “the amount of the credit determined for the taxable year under section 51(a)" and by substituting “EMPLOYMENT CREDITS” for “TARGETED JOBS CREDIT" in the heading.
1989 - Subsec. (c)(1), (2)(A). Pub. L. 101-239, Sec. 7110(c)(1), struck out ‘50 percent of’ before ‘the amount of the credit’.
Subsec. (c)(3). Pub. L. 101-239, Sec. 7814(e)(2)(A), added par. (3). Former par. (3) redesignated (4).
Subsec. (c)(3)(B)(ii)(I). Pub. L. 101-239, Sec. 7110(c)(1), struck out ‘50 percent of’ before ‘the amount described’.
Subsec. (c)(4). Pub. L. 101-239, Sec. 7814(e)(2)(A), redesignated par. (3) as (4).
1988 - Subsec. (c). Pub. L. 100-647 added subsec. (c).
1986 - Subsec. (b)(1), (2)(A). Pub. L. 99-514, Sec. 1847(b)(8), substituted ‘section 28(b)’ for ‘section 29(b)’ in par. (1) and ‘section 28’ for ‘section 29’ in pars. (1) and (2)(A).
Subsec. (b)(3). Pub. L. 99-514, Sec. 231(d)(3)(E), substituted ‘section 41(f)(5)’, ‘section 41(f)(1)(B)’, and ‘section 41(f)(1)’ for ‘section 30(f)(5)’, ‘section 30(f)(1)(B)’, and ‘section 30(f)(1)’, respectively.
1984 - Subsec. (a). Pub. L. 98-369, Sec. 474(r)(10)(A), (B), redesignated subsec. (b) as (a), in heading substituted ‘targeted jobs credit’ for ‘section 44B credit’, and in text substituted ‘No deduction shall be allowed for that portion of the wages or salaries paid or incurred for the taxable year which is equal to the amount of the credit determined for the taxable year under section 51(a)’ for ‘No deduction shall be allowed for that portion of the wage or salaries paid or incurred for the taxable year which is equal to the amount of the credit allowable for the taxable year under section 44B (relating to credit for employment of certain new employees) determined without regard to the provisions of section 53 (relating to limitation based on amount of tax)’. Former subsec. (a), which had provided that no deduction would be allowed for that portion of the work incentive program expenses paid or incurred for the taxable year which was equal to the amount of the credit allowable for the taxable year under section 40 (relating to credit for expenses of work incentive programs) determined without regard to the provisions of section 50A(a)(2) (relating to limitation based on amount of tax), and that in the case of a corporation which was a member of a controlled group of corporations (within the meaning of section 50B(g)(1) or a trade or business which was treated as being under common control with other trades or businesses within the meaning of section 50B(g)(2), this subsection would be applied under rules precribed by the Secretary similar to the rules applicable under paragrpahs (1) and (2) of section 50B(g), was struck out.
Subsec. (b). Pub. L. 98-369, Sec. 474(r)(10)(A), redesignated subsec. (c) as (b). Former subsec. (b) redesignated (a).
Subsec. (b)(1), (2)(A). Pub. L. 98-369, Sec. 474(r)(10)(C), substituted ‘29’ for ‘44H’.
Subsec. (b)(3). Pub. L. 98-369, Sec. 474(r)(10)(D), substituted ‘section 30(f)(5)’ for ‘section 44F(f)(5)’, ‘section 30(f)(1)(B)’ for ‘section 44F(f)(1)(B)’, and ‘section 30(f)(1)’ for ‘section 44F(f)(1)’.
Subsec. (c). Pub. L. 98-369, Sec. 474(r)(10)(A), redesignated subsec. (c) as (b).
1983 - Pub. L. 97-414, Sec. 4(b)(2)(A), substituted ‘Certain expenses for which credits are allowable’ for ‘Portion of wages for which credit is claimed under section 40 or 44B’ in section catchline.
Subsec. (c). Pub. L. 97-414, Sec. 4(b)(1), added subsec. (c).
1978 - Pub. L. 95-600, as amended by Pub. L. 96-178 and Pub. L. 96-222, substituted ‘section 40 or 44B’ for ‘section 44B’ in section catchline, and in text designated existing provisions as subsec. (b) and added subsec. (a).
EFFECTIVE DATE OF 2018 AMENDMENTS
Amendments by Pub. L. 115-141, Div. U, Sec. 401(a)(62), (d)(3)(B)(iii), (d)(6)(B)(iv), effective March 23, 2018.
Sec. 401(d)(6)(C) of Pub. L. 115-141, Div. U, provided the following Savings Provision:
“(C) Savings Provisions.—The amendments made by this paragraph shall not apply to—
“(i) in the case of the repeal of section 1400L(a) of the Internal Revenue Code of 1986, qualified wages (as defined in such section, as in effect before its repeal) which were paid or incurred before January 1, 2004,
“(ii) in the case of the repeal of subsections (b) and (f) of section 1400L of such Code, qualified New York Liberty Zone property (as defined in section 1400L(b) of such Code, as in effect before its repeal) placed in service before January 1, 2010,
“(iii) in the case of the repeal of section 1400L(c) of such Code, qualified New York Liberty Zone leasehold improvement property (as defined in such section, as in effect before its repeal) placed in service before January 1, 2007,
“(iv) in the case of the repeal of section 1400L(d) of such Code, qualified New York Liberty bonds (as defined in such section, as in effect before its repeal) issued before January 1, 2014,
“(v) in the case of the repeal of section 1400L(e) of such Code, advanced refundings before January 1, 2006,
“(vi) in the case of the repeal of section 1400L(g) of such Code, property which is compulsorily or involuntarily converted as a result of the terrorist attacks on September 11, 2001,
“(vii) in the case of the repeal of section 1400N(a) of such Code, obligations issued before January 1, 2012,
“(viii) in the case of the repeal of section 1400N(b) of such Code, advanced refundings before January 1, 2011,
“(ix) in the case of the repeal of section 1400N(d) of such Code, property placed in service before January 1, 2012,
“(x) in the case of the repeal of section 1400N(e) of such Code, property placed in service before January 1, 2009,
“(xi) in the case of the repeal of subsections (f) and (g) of section 1400N of such Code, amounts paid or incurred before January 1, 2008,
“(xii) in the case of the repeal of section 1400N(h) of such Code, amounts paid or incurred before January 1, 2012,
“(xiii) in the case of the repeal of section 1400N(k)(1)(B) of such Code, losses arising in taxable years beginning before January 1, 2008,
“(xiv) in the case of the repeal of section 1400N(l) of such Code, bonds issued before January 1, 2007,
“(xv) in the case of the repeal of section 1400Q(a) of such Code, distributions before January 1, 2007,
“(xvi) in the case of the repeal of section 1400Q(b) of such Code, contributions before March 1, 2006,
“(xvii) in the case of the repeal of section 1400Q(c) of such Code, loans made before January 1, 2007,
“(xviii) in the case of the repeal of section 1400R of such Code, wages paid or incurred before January 1, 2006,
“(xix) in the case of the repeal of section 1400S(a) of such Code, contributions paid before January 1, 2006,
“(xx) in the case of the repeal of section 1400T of such Code, financing provided before January 1, 2011, and
“(xxi) in the case of the repeal of part III of subchapter Y of chapter 1 of such Code, obligations issued before January 1, 2011.”
Sec. 401(e) of Pub. L. 115-141, Div. U, provided the following savings provision:
“(e) General Savings Provision With Respect To Deadwood Provisions.—If—
“(1) any provision amended or repealed by the amendments made by subsection (b) or (d) applied to—
“(A) any transaction occurring before the date of the enactment of this Act,
“(B) any property acquired before such date of enactment, or
“(C) any item of income, loss, deduction, or credit taken into account before such date of enactment, and
“(2) the treatment of such transaction, property, or item under such provision would (without regard to the amendments or repeals made by such subsection) affect the liability for tax for periods ending after such date of enactment,
“nothing in the amendments or repeals made by this section shall be construed to affect the treatment of such transaction, property, or item for purposes of determining liability for tax for periods ending after such date of enactment.”
EFFECTIVE DATE OF 2017 AMENDMENTS
Amendment by Pub. L. 115-97, Sec. 13403(d)(1), effective for wages paid in taxable years beginning after December 31, 2017.
Amendments by Pub. L. 115-97, Sec. 13001(b)(1)(A), and Sec. 13401(b), effective for taxable years beginning after December 31, 2017.
Amendments by Pub. L. 115-97, Sec. 13206(d)(2), effective for amounts paid or incurred in taxable years ending after December 31, 2021.
EFFECTIVE DATE OF 2010 AMENDMENTS
Amendment by section 1401(b) of Pub. L. 111-148 effective for taxable years ending after December 31, 2013.
Amendment by section 1421(d) of Pub. L. 111-148, as amended by Sec. 10105(e), effective for amounts paid or incurred in taxable years beginning after December 31, 2009.
Amendment by section 9023(c)(2) of Pub. L. 111-148 effective for amounts paid or incurred after December 31, 2008 in taxable years beginning after such date.
Amendment by section 10105(e)(3) of Pub. L. 111-148 effective as if included in the enactment of section 1421 of this Act.
EFFECTIVE DATE OF 2008 AMENDMENTS
Amendment by section 111(c) of Pub. L. 110-245 effective for amounts paid after the date of the enactment of this Act [Enacted: June 17, 2008].
Amendment by section 15343(c) of Pub. L. 110-246 effective for amounts paid or incurred after the date of the enactment of this Act [Effective: May 22, 2008]. Note that the original provisions of Pub. L. 110-246 were enacted as Pub. L. 110-234 on May 22, 2008, but were repealed by Pub. L. 110-246, Sec. 4, effective May 22, 2008. Sec. 4 of Pub. L. 110-246 provided that:
“Sec. 4. Repeal of Duplicative Enactment.
“(a) In General.—The Act entitled ‘An Act to provide for the continuation of agricultural programs through fiscal year 2012, and for other purposes’ (H.R. 2419 of the 110th Congress), and the amendments made by that Act, are repealed, effective on the date of the enactment of that Act.
“(b) Effective Date.—Except as otherwise provided in this Act, this Act and the amendments made by this Act shall take effect on the earlier of—
“(1) the date of enactment of this Act [Enacted: June 18, 2008]; or
“(2) the date of the enactment of the Act entitled ‘An Act to provide for the continuation of agricultural programs through fiscal year 2012, and for other purposes’ (H.R. 2419 of the 110th Congress) [Enacted: May 22, 2008].”
EFFECTIVE DATE OF 2007 AMENDMENT
Amendment by section 7(a)(1)(B) of Pub. L. 110-172 effective as if included in the provisions of the American Jobs Creation Act of 2004 [Pub. L. 108-357, Sec. 339] to which it relates.
EFFECTIVE DATE OF 2006 AMENDMENT
Amendment by section 404(c) of Pub. L. 109-432 applicable for taxable years beginning after December 31, 2005.
EFFECTIVE DATE OF 2005 AMENDMENTS
Amendment by section 103(b)(2) of Pub. L. 109-135 applicable on the date of the enactment of this Act [Enacted: Dec. 21, 2005].
Amendment by section 201(b)(2) of Pub. L. 109-135 applicable on the date of the enactment of this Act [Enacted: Dec. 21, 2005].
EFFECTIVE DATE OF 2004 AMENDMENT
Amendment by section 339(c) of Pub. L. 108-357 applicable to expenses paid or incurred after December 31, 2002, in taxable years ending after such date.
EFFECTIVE DATE OF 2000 AMENDMENT
Amendment by section 311(a)(1) of Pub. L. 106-554 effective as if included in the provisions of the Ticket to Work and Work Incentives Improvement Act of 1999 to which it relates [to amounts paid or incurred after June 30, 1999].
EFFECTIVE DATE OF 1999 AMENDMENT
Amendment by section 502(c)(2) of Pub. L. 106-170 applicable to amounts paid or incurred after June 30, 1999. Sec. 502(d) provided the following special rule:
“(d) SPECIAL RULE.--
“(1) IN GENERAL.--For purposes of the Internal Revenue Code of 1986, the credit determined under section 41 of such Code which is otherwise allowable under such Code--
“(A) shall not be taken into account prior to October 1, 2000, to the extent such credit is attributable to the first suspension period, and
“(B) shall not be taken into account prior to October 1, 2001, to the extent such credit is attributable to the second suspension period.
“On or after the earliest date that an amount of credit may be taken into account, such amount may be taken into account through the filing of an amended return, an application for expedited refund, an adjustment of estimated taxes, or other means allowed by such Code.
“(2) SUSPENSION PERIODS.--For purposes of this subsection--
“(A) the first suspension period is the period beginning on July 1, 1999, and ending on September 30, 2000, and
“(B) the second suspension period is the period beginning on October 1, 2000, and ending on September 30, 2001.
“(3) EXPEDITED REFUNDS.--
“(A) IN GENERAL.--If there is an overpayment of tax with respect to a taxable year by reason of paragraph (1), the taxpayer may file an application for a tentative refund of such overpayment. Such application shall be in such manner and form, and contain such information, as the Secretary may prescribe.
“(B) DEADLINE FOR APPLICATIONS.--Subparagraph (A) shall apply only to an application filed before the date which is 1 year after the close of the suspension period to which the application relates.
“(C) ALLOWANCE OF ADJUSTMENTS.--Not later than 90 days after the date on which an application is filed under this paragraph, the Secretary shall--
“(i) review the application,
“(ii) determine the amount of the overpayment, and
“(iii) apply, credit, or refund such overpayment, in a manner similar to the manner provided in section 6411(b) of such Code.
“(D) CONSOLIDATED RETURNS.--The provisions of section 6411(c) of such Code shall apply to an adjustment under this paragraph in such manner as the Secretary may provide.
“(4) CREDIT ATTRIBUTABLE TO SUSPENSION PERIOD.--
“(A) IN GENERAL.--For purposes of this subsection, in the case of a taxable year which includes a portion of the suspension period, the amount of credit determined under section 41 of such Code for such taxable year which is attributable to such period is the amount which bears the same ratio to the amount of credit determined under such section 41 for such taxable year as the number of months in the suspension period which are during such taxable year bears to the number of months in such taxable year.
“(B) WAIVER OF ESTIMATED TAX PENALTIES.--No addition to tax shall be made under section 6654 or 6655 of such Code for any period before July 1, 1999, with respect to any underpayment of tax imposed by such Code to the extent such underpayment was created or increased by reason of subparagraph (A).
“(5) SECRETARY.--For purposes of this subsection, the term “Secretary” means the Secretary of the Treasury (or such Secretary's delegate).”
EFFECTIVE DATE OF 1996 AMENDMENT
Amendment by section 1205(d)(7) of Pub. L. 104-188 applicable to taxable years ending after June 30, 1996.
EFFECTIVE DATE OF 1993 AMENDMENTS
Amendments by section 13302(b) of Pub. L. 103-66 applicable on the date of the enactment of this Act [Enacted: Aug. 10, 1993].
Amendment by section 13322(c) of Pub. L. 103-66 applicable for wages paid or incurred after December 31, 1993.
EFFECTIVE DATE OF 1989 AMENDMENT
Amendment by section 7110(c)(1) of Pub. L. 101-239 applicable to taxable years beginning after Dec. 31, 1989, see section 7110(e) of Pub. L. 101-239, set out as a note under section 41 of this title.
Amendment by section 7814(e)(2)(A) of Pub. L. 101-239 effective, except as otherwise provided, as if included in the provision of the Technical and Miscellaneous Revenue Act of 1988, Pub. L. 100-647, to which such amendment relates, see section 7817 of Pub. L. 101-239, set out as a note under section 1 of this title.
EFFECTIVE DATE OF 1988 AMENDMENT
Amendment by Pub. L. 100-647 applicable to taxable years beginning after Dec. 31, 1988, see section 4008(d) of Pub. L. 100-647, set out as a note under section 41 of this title.
EFFECTIVE DATE OF 1986 AMENDMENT
Amendment by section 231(d)(3)(E) of Pub. L. 99-514 applicable to taxable years beginning after Dec. 31, 1985, see section 231(g) of Pub. L. 99-514, set out as a note under section 41 of this title.
Amendment by section 1847(b)(8) of Pub. L. 99-514 effective, except as otherwise provided, as if included in the provisions of the Tax Reform Act of 1984, Pub. L. 98-369, div. A, to which such amendment relates, see section 1881 of Pub. L. 99-514, set out as a note under section 48 of this title.
EFFECTIVE DATE OF 1984 AMENDMENT
Amendment by Pub. L. 98-369 applicable to taxable years beginning after Dec. 31, 1983, and to carrybacks from such years, see section 475(a) of Pub. L. 98-369, set out as a note under section 21 of this title.
EFFECTIVE DATE OF 1983 AMENDMENT
Amendment by Pub. L. 97-414 applicable to amounts paid or incurred after December 31, 1982, in taxable years ending after such date, see section 4(d) of Pub. L. 97-414, set out as an Effective Date note under section 28 of this title.
EFFECTIVE DATE OF 1978 AMENDMENT
Section 322(e) of Pub. L. 95-600, as amended by Pub. L. 96-178, Sec. 6(a), (b), Jan. 2, 1980, 93 Stat. 1297; Pub. L. 96-222, title I, Sec. 103(a)(7)(A), (B), Apr. 1, 1980, 94 Stat. 211; Pub. L. 99-514, Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that:
‘(1) In general. - Except as otherwise provided in this subsection, the amendments made by this section (amending this section and sections 50A and 50B of this title) shall apply to work incentive program expenses paid or incurred after December 31, 1978, in taxable years ending after such date; except that so much of the amendment made by subsection (a) as affects section 50A(a)(2) of the Internal Revenue Code of 1986 (formerly I.R.C. 1954) shall apply to taxable years beginning after December 31, 1978. For purposes of applying section 50A(a)(2) of the Internal Revenue Code of 1986 with respect to a taxable year beginning before January 1, 1979, the rules of sections 50A(a)(4), 50A(a)(5), and 50B(e)(3) of such Code (as in effect on the day before the date of the enactment of this Act (Nov. 6, 1978) shall apply.
‘(2) Special rules for certain eligible employees. -
‘(A) Eligible employees hired before september 27, 1978. - In the case of any eligible employee (as defined in section 50B(h)) hired before September 27, 1978, no credit shall be allowed under section 40 with respect to second-year work incentive program expenses (as defined in section 50B(a)) attributable to service performed by such employee.
‘(B) Eligible employees hired after september 26, 1978. - In the case of any eligible employee (as defined in section 50B(h)) hired after September 26, 1978, for purposes of applying the amendments made by this section, such individual shall be treated for purposes of the credit allowed by section 40 as having first begun work for the taxpayer not earlier than January 1, 1979, and any wages paid or incurred after December 31, 1978, with respect to such individual shall be considered to be attributable to services rendered after that date.’
(Section 6(d) of Pub. L. 96-178 provided that: ‘Any amendment made by this section to the Revenue Act of 1978 (amending section 322(e)(1) and (2) of Pub. L. 95-600, set out above) shall take effect as if it had been included in the provision of the Revenue Act of 1978 (Pub. L. 95-600) to which such amendment relates.')
EFFECTIVE DATE
Section applicable to taxable years beginning after Dec. 31, 1976, and to credit carrybacks from such years, see section 202(e) of Pub. L. 95-30, set out as a note under section 51 of this title.
SPECIAL RULE FOR ELECTIONS UNDER EXPIRED PROVISIONS
Section 123 of Pub. L. 109-432 provided that:
“(a) Research Credit Elections.--In the case of any taxable year ending after December 31, 2005, and before the date of the enactment of this Act, any election under section 41(c)(4) or section 280C(c)(3)(C) of the Internal Revenue Code of 1986 shall be treated as having been timely made for such taxable year if such election is made not later than the later of April 15, 2007, or such time as the Secretary of the Treasury, or his designee, may specify. Such election shall be made in the manner prescribed by such Secretary or designee.
“(b) Other Elections.--Except as otherwise provided by such Secretary or designee, a rule similar to the rule of subsection (a) shall apply with respect to elections under any other expired provision of the Internal Revenue Code of 1986 the applicability of which is extended by reason of the amendments made by this title.”
EMPLOYEE RETENTION CREDIT FOR EMPLOYERS AFFECTED BY HURRICANE KATRINA
Section 202 of Pub. L. 109-73, before repeal by Pub. L. 109-135, Sec. 201(b)(4) (effective Dec. 21, 2005), provided that:
“(a) IN GENERAL.--In the case of an eligible employer, there shall be allowed as a credit against the tax imposed by chapter1 of the Internal Revenue Code of 1986 for the taxable year an amount equal to 40 percent of the qualified wages with respect to each eligible employee of such employer for such taxable year. For purposes of the preceding sentence, the amount of qualified wages which may be taken into account with respect to any individual shall not exceed $6,000.
“(b) DEFINITIONS.--For purposes of this section--
“(1) ELIGIBLE EMPLOYER.--The term “eligible employer" means any employer--
“(A) which conducted an active trade or business on August 28, 2005, in a core disaster area, and
“(B) with respect to whom the trade or business described in subparagraph (A) is inoperable on any day after August 28, 2005, and before January 1, 2006, as a result of damage sustained by reason of Hurricane Katrina.
“(2) ELIGIBLE EMPLOYEE.--The term “eligible employee" means with respect to an eligible employer an employee whose principal place of employment on August 28, 2005, with such eligible employer was in a core disaster area.
“(3) QUALIFIED WAGES.--The term “qualified wages" means wages (as defined in section 51(c)(1) of such Code, but without regard to section 3306(b)(2)(B) of such Code) paid or incurred by an eligible employer with respect to an eligible employee on any day after August 28, 2005, and before January 1, 2006, which occurs during the period--
“(A) beginning on the date on which the trade or business described in paragraph (1) first became inoperable at the principal place of employment of the employee immediately before Hurricane Katrina, and
“(B) ending on the date on which such trade or business has resumed significant operations at such principal place of employment.
“Such term shall include wages paid without regard to whether the employee performs no services, performs services at a different place of employment than such principal place of employment, or performs services at such principal place of employment before significant operations have resumed.
“(c) CREDIT NOT ALLOWED FOR LARGE BUSINESSES.--The term “eligible employer” shall not include any trade or business for any taxable year if such trade or business employed an average of more than 200 employees on business days during the taxable year.
“(d) CERTAIN RULES TO APPLY.--For purposes of this section, rules similar to the rules of sections 51(i)(1), 52, and 280C(a) of such Code shall apply.
“(e) EMPLOYEE NOT TAKEN INTO ACCOUNT MORE THAN ONCE.--An employee shall not be treated as an eligible employee for purposes of this section for any period with respect to any employer if such employer is allowed a credit under section 51 of such Code with respect to such employee for such period.
“(f) CREDIT TO BE PART OF GENERAL BUSINESS CREDIT.--The credit allowed under this section shall be added to the current year business credit under section 38(b) of such Code and shall be treated as a credit allowed under subpart D of part IV of subchapter A of chapter 1 of such Code.”
TIME AND FORM OF CERTAIN ELECTIONS UNDER SUBSECTION (c)(3)
Section 7814(e)(2)(B) of Pub. L. 101-239 provided that: ‘In the case of a taxable year for which the last date for making the election under section 280C(c)(3) of the Internal Revenue Code of 1986 (as added by subparagraph (A)) is on or before the date which is 75 days after the date of the enactment of this Act (Dec. 19, 1989), such an election for such year may be made -
‘(i) at any time before the date which is 75 days after such date of enactment, and
‘(ii) in such form and manner as the Secretary of the Treasury or his delegate may prescribe.’
PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989
For provisions directing that if any amendments made by subtitle A or subtitle C of title XI (Sec. 1101-1147 and 1171-1177) or title XVIII (Sec. 1800-1899A) of Pub. L. 99-514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. L. 99-514, as amended, set out as a note under section 401 of this title.
[280D. Repealed. Pub. L. 100-418, title I, 1941(b)(4)(A), Aug. 23, 1988, 102 Stat. 1324]
Section, added Pub. L. 96-499, title XI, 1131(d)(1), Dec. 5, 1980, 94 Stat. 2693, related to portion of chapter 45 windfall profit tax on domestic crude oil for which credit or refund was allowable under section 6429.
Effective Date of Repeal
Repeal applicable to crude oil removed from the premises on or after Aug. 23, 1988, see section 1941(c) of Pub. L. 100-418, set out as an Effective Date of 1988 Amendment note under section 164 of this title.