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I
116TH CONGRESS
2D SESSION
H. R. 6529
To amend the Internal Revenue Code of 1986 to modify the opportunity
zone tax incentives.
IN THE HOUSE OF REPRESENTATIVES
APRIL 17, 2020
Mr. CURTIS (for himself and Mr. CUELLAR) 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 modify
the opportunity zone tax incentives.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
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SECTION 1. SHORT TITLE.
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This Act may be cited as the ‘‘COVID-19-Impacted
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Small Business Opportunity Zone Act’’.
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SEC. 2. MODIFICATION OF OPPORTUNITY ZONE TAX INCEN-
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TIVES.
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(a) SMALL BUSINESSES AFFECTED BY COVID-19
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TREATED
AS QUALIFIED OPPORTUNITY ZONE BUSI-
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NESSES.—Section 1400Z–2(d)(3) of the Internal Revenue
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•HR 6529 IH
Code of 1986 is amended by adding at the end the fol-
1
lowing new subparagraph:
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‘‘(C) CERTAIN
SMALL
BUSINESSES
AF-
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FECTED BY COVID-19 TREATED AS QUALIFIED
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OPPORTUNITY ZONE BUSINESSES.—
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‘‘(i)
IN
GENERAL.—Subparagraph
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(A)(i) shall not apply with respect to any
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qualified small business.
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‘‘(ii) QUALIFIED SMALL BUSINESS.—
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For purposes of this subparagraph, the
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term ‘qualified small business’ means any
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small business if such small business has
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experienced any of the following as a result
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of the spread of, or of the public’s or any
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government’s response to, COVID-19—
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‘‘(I) supply chain disruptions, in-
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cluding changes in quantity, lead
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time, delay, or the number of ship-
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ments of components; changes in the
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quality of supplied components; and
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disruption by reason of compromised
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payment networks or other techno-
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logical reasons,
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‘‘(II) staffing challenges,
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‘‘(III) decrease in sales or cus-
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tomers, or
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‘‘(IV) partial or full suspension
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of business.
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‘‘(iii) SMALL
BUSINESS.—For pur-
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poses of this subparagraph, the term ‘small
6
business’ means any trade or business if
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the gross receipts (as determined under the
8
rules of section 448(c)(3), without regard
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to subparagraph (A) thereof) of such trade
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or business (when combined with all re-
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lated trades or businesses) for the relevant
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taxable year do not exceed $999,999. For
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purposes of the preceding sentence, a trade
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or business shall be treated as related if it
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is a trade or business of the same person
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or of any person treated as one person
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under section 448(c)(2). For purposes of
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this clause, the term ‘relevant taxable year’
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means the last taxable year which ends be-
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fore the date on which the qualified oppor-
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tunity zone fund acquires the qualified op-
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portunity fund property to which such
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trade or business relates.
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‘‘(iv)
APPLICATION
OF
SUBPARA-
1
GRAPH.—Clause (i) shall only apply with
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respect to qualified opportunity fund prop-
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erty acquired by a qualified opportunity
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zone fund during the 1-year period begin-
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ning on the date of the enactment of this
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subparagraph.’’.
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(b) APPLICATION OF CAPITAL GAINS RATE FOR TAX-
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ABLE YEAR IN WHICH INVESTMENT IS ACQUIRED.—Sec-
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tion 1400Z–2(b) of such Code is amended by adding at
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the end the following new paragraph:
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‘‘(3) APPLICATION OF CAPITAL GAINS RATES.—
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The rate of tax which applies to gain which is in-
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cluded in income as provided in this subsection shall
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not exceed the rate applicable to such gain in the
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taxable year in which the investment was acquired.
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Proper adjustments shall be made in the application
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of section 1(h) for the taxable year in which such
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gain is included in gross income to take into account
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the preceding sentence.’’.
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(c) EXTENSION OF DEFERRAL OF GAIN INVESTED
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IN OPPORTUNITY ZONES.—Section 1400Z–2(b)(1)(B) of
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such Code is amended to read as follows:
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‘‘(B) the date which is 7 years after the
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date on which such investment was acquired.’’.
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(d) EXEMPTION
FROM
TAX
FOR
INVESTMENTS
1
HELD FOR AT LEAST 10 YEARS WITHOUT REGARD TO
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WHETHER
INVESTMENT
CONSISTS
OF
REINVESTED
3
GAIN.—Section 1400Z–2(c) of such Code is amended by
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striking ‘‘any investment’’ and inserting ‘‘any investment
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in a qualified opportunity fund (without regard to whether
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such investment is described in subsection (a))’’.
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(e) EFFECTIVE DATES.—
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(1) IN
GENERAL.—Except as otherwise pro-
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vided in this subsection, the amendments made by
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this section shall apply to investments in qualified
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opportunity funds made after the date of the enact-
12
ment of this Act.
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(2) SMALL BUSINESSES AFFECTED BY COVID-19
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TREATED AS QUALIFIED OPPORTUNITY ZONE BUSI-
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NESSES.—The amendment made by subsection (a)
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shall apply to property acquired by qualified oppor-
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tunity zone funds after the date of the enactment of
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this Act.
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Æ
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