To amend the Internal Revenue Code of 1986 to permit year 2000 computer conversion costs to be expensed by small businesses under section 179 and to provide a $20,000 increase in the limitation under section 179 for such costs.

Amends the Internal Revenue Code to: (1) permit Year 2000 computer problem conversion costs to be expensed; and (2) increase, for 1998 and 1999, the limitation for such costs.

[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4134 Introduced in House (IH)]







105th CONGRESS
  2d Session
                                H. R. 4134

To amend the Internal Revenue Code of 1986 to permit year 2000 computer 
 conversion costs to be expensed by small businesses under section 179 
 and to provide a $20,000 increase in the limitation under section 179 
                            for such costs.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 24, 1998

 Mrs. Thurman 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 permit year 2000 computer 
 conversion costs to be expensed by small businesses under section 179 
 and to provide a $20,000 increase in the limitation under section 179 
                            for such costs.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. EXPENSE TREATMENT FOR COSTS OF MAKING COMPUTERS AND COMPUTER 
              SOFTWARE YEAR 2000 COMPLIANT.

    (a) In General.--Section 179 of the Internal Revenue Code of 1986 
(relating to election to expense certain depreciable business assets) 
is amended by adding at the end the following new subsection:
    ``(e) Costs of Making Computers and Computer Software Year 2000 
Compliant.--
            ``(1) In general.--For purposes of this section, the term 
        `section 179 property' includes any of the following items 
        which are placed in service during 1998 or 1999, which are for 
        use in the active conduct or a trade or business, and which are 
        of a character subject to the allowance for depreciation or 
        amortization:
                    ``(A) The cost of modifying computer software to 
                address the year 2000 computer conversion problem.
                    ``(B) The cost of purchasing computer software 
                which is year 2000 compliant to replace computer 
                software which is not so compliant.
            ``(2) Increase in limitation.--The limitation under 
        subsection (b)(1) shall be increased for each taxable year 
        which includes any portion of calendar year 1998 or 1999 by the 
        lesser of $20,000 or the sum of--
                    ``(A) the aggregate cost of property which is 
                treated as section 179 property under paragraph (1) for 
                such taxable year, and
                    ``(B) the cost of purchasing any computer system to 
                replace a computer system where such replacement is 
                necessary because of the year 2000 computer conversion 
                problem.''
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to taxable years ending after December 31, 1997.
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