To amend the Internal Revenue Code of 1986 to classify qualified rental office furniture as 5-year property for purposes of depreciation.

Amends the Internal Revenue Code to classify as five-year property for depreciation purposes any qualified rental office furniture held by an office furniture rental dealer primarily for leasing to customers by means of a short-term rental contract. States that options to renew such a contract at the same or greater price shall not be taken into account in determining a lease term for such purposes.

[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2744 Introduced in House (IH)]







107th CONGRESS
  1st Session
                                H. R. 2744

To amend the Internal Revenue Code of 1986 to classify qualified rental 
   office furniture as 5-year property for purposes of depreciation.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             August 2, 2001

 Mr. Collins 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 classify qualified rental 
   office furniture as 5-year property for purposes of depreciation.

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

SECTION 1. CLASSIFICATION OF QUALIFIED RENTAL OFFICE FURNITURE.

    (a) In General.--Subparagraph (B) of section 168 (e)(3) of the 
Internal Revenue Code of 1986 (relating to 5-year property) is amended 
by striking ``and'' at the end of clause (v), by striking the period at 
the end of clause (vi) and inserting ``, and,'' and by adding at the 
end the following:
                            ``(vii) any qualified rental office 
                        furniture.''
    (b) Alternative System.--The table contained in section 
168(g)(3)(B) of the Internal Revenue Code of 1986 is amended by 
inserting after the third item the following:

``(B)(vii)..................................................       9''.
    (c) Definition of Qualified Rental Office Furniture.--Subsection 
(i) of section 168 of the Internal Revenue Code of 1986 is amended by 
adding at the end the following:
            ``(15) Qualified rental office furniture.--
                    ``(A) In general.--The term `qualified rental 
                office furniture' means office furniture held by an 
                office furniture rental dealer primarily for purposes 
                of leasing to customers by means of a short-term office 
                furniture rental contract.
                    ``(B) Office furniture rental dealer.--The term 
                `office furniture rental dealer' means a person that, 
                in the ordinary course of business, regularly enters 
                into short-term office furniture rental contracts with 
                customers for the use of office furniture.
                    ``(C) Short-term office furniture rental 
                contract.--The term `short-term office furniture rental 
                contract' means any lease with a term of 18 months or 
                less, between unrelated parties, for the use of office 
                furniture.''.
    (d) Options To Renew Not To Be Automatically Taken Into Account.--
Paragraph (3) of subsection (i) of section 168 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following:
                    ``(C) Special rule for options on short-term office 
                furniture rental contracts.--For purposes of clause (i) 
                of subparagraph (A), in the case of a short-term office 
                furniture rental contract, there shall not be taken 
                into account any option to renew at a price equal to or 
                in excess of the price applicable to the initial term 
                of the lease.''.
    (e) Applicability.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to property placed 
        in service on or after the date of the enactment of this Act.
            (2) Transition rule.--
                    (A) In general.--A taxpayer may elect (in such form 
                and manner as the Secretary of the Treasury may 
                prescribe) to have the amendments made by this section 
                apply to property placed in service before the date of 
                the enactment of this section.
                    (B) Method of accounting.--For purposes of section 
                481, an election under subparagraph (A) shall be 
                treated as a change in method of accounting made with 
                the consent of the Secretary of the Treasury and any 
                adjustment necessary by reason of such change shall be 
                included in the year of the change.
                    (C) Election deemed made.--For purposes of 
                subparagraph (A), a taxpayer which has consistently 
                treated qualified rental office furniture (as defined 
                in section 168(i)(15) of the Internal Revenue Code of 
                1986) as 5-year property shall be treated as having 
                made the election under such subparagraph with respect 
                to the property.
                                 <all>