Sec. 1351. EXPANSION OF RESEARCH CREDIT
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## SEC. 1351 EXPANSION OF RESEARCH CREDIT ###
(a)Credit for Expenses Attributable to Certain Collaborative Energy Research Consortia ####
(1)In general Section 41(a) (relating to credit for increasing research activities) is amended by striking “ and ” at the end of paragraph (1), by striking the period at the end of paragraph
(2)and inserting “ , and ”, and by adding at the end the following new paragraph: > > #### “(3) > > 20 percent of the amounts paid or incurred by the taxpayer in carrying on any trade or business of the taxpayer during the taxable year (including as contributions) to an energy research consortium.” > . ####
(2)Energy research consortium defined Section 41(f) (relating to special rules) is amended by adding at the end the following new paragraph: > > #### “(6) Energy research consortium > > > ##### “(A) In general > > The term ‘**energy research consortium**’ means any organization— > > > ###### “(i) > > which is— > > > ###### “(I) > > described in section 501(c)(3) and is exempt from tax under section 501(a) and is organized and operated primarily to conduct energy research, or > > > ###### “(II) > > organized and operated primarily to conduct energy research in the public interest (within the meaning of section 501(c)(3)), > > > ###### “(ii) > > which is not a private foundation, > > > ###### “(iii) > > to which at least 5 unrelated persons paid or incurred during the calendar year in which the taxable year of the organization begins amounts (including as contributions) to such organization for energy research, and > > > ###### “(iv) > > to which no single person paid or incurred (including as contributions) during such calendar year an amount equal to more than 50 percent of the total amounts received by such organization during such calendar year for energy research. > > > ##### “(B) Treatment of persons > > All persons treated as a single employer under subsection
(a)or
(b)of section 52 shall be treated as related persons for purposes of subparagraph (A)(iii) and as a single person for purposes of subparagraph (A)(iv).” > . ####
(3)Conforming amendment Section 41(b)(3)(C) is amended by inserting “(other than an energy research consortium)” after “organization”. ###
(b)Repeal of Limitation on Contract Research Expenses Paid to Small Businesses, Universities, and Federal Laboratories Section 41(b)(3) (relating to contract research expenses) is amended by adding at the end the following new subparagraph: > > ##### “(D) Amounts paid to eligible small businesses, universities, and federal laboratories > > > ###### “(i) In general > > In the case of amounts paid by the taxpayer to— > > > ###### “(I) > > an eligible small business, > > > ###### “(II) > > an institution of higher education (as defined in section 3304(f)), or > > > ###### “(III) > > an organization which is a Federal laboratory, > > for qualified research which is energy research, subparagraph
(A)shall be applied by substituting ‘100 percent’ for ‘65 percent’. > > > ###### “(ii) Eligible small business > > For purposes of this subparagraph, the term ‘**eligible small business**’ means a small business with respect to which the taxpayer does not own (within the meaning of section 318) 50 percent or more of— > > > ###### “(I) > > in the case of a corporation, the outstanding stock of the corporation (either by vote or value), and > > > ###### “(II) > > in the case of a small business which is not a corporation, the capital and profits interests of the small business. > > > ###### “(iii) Small business > > For purposes of this subparagraph— > > > ###### “(I) In general > > The term ‘**small business**’ means, with respect to any calendar year, any person if the annual average number of employees employed by such person during either of the 2 preceding calendar years was 500 or fewer. For purposes of the preceding sentence, a preceding calendar year may be taken into account only if the person was in existence throughout the year. > > > ###### “(II) Startups, controlled groups, and predecessors > > Rules similar to the rules of subparagraphs
(B)and
(D)of section 220(c)(4) shall apply for purposes of this clause. > > > ###### “(iv) Federal laboratory > > For purposes of this subparagraph, the term ‘**Federal laboratory**’ has the meaning given such term by section 4(6) of the Stevenson-Wydler Technology Innovation Act of 1980 (15 U.S.C. 3703(6)), as in effect on the date of the enactment of the Energy Tax Incentives Act of 2005.” > . ###
(c)Effective Date The amendments made by this section shall apply to amounts paid or incurred after the date of the enactment of this Act, in taxable years ending after such date.
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Sec. 1351
EXPANSION OF RESEARCH CREDIT
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