12 2 STA T .386 6 PUBLIC LA W 11 0– 3 4 3 —O CT. 3 , 2008 ‘ ‘ afterD e c e mb er 31,20 0 7’ ’a ndi n s ertin g ‘‘after December 31, 200 9 ’’ .( b )TERMINAT I O NO FAL TERNATI V E I N C REMENTAL C RE D IT. —S ec - ti o n 4 1( h ) is amended b y redesignating p aragraph (2) as paragraph (3), and by inserting after paragraph (1) the fo l lo w ing new para- graph
‘‘(2) TERMINATION OF ALTERNATIVE INCREMENTAL CREDIT.— N o election u nder subsection (c)(4) shall apply to ta x able years beginning after December 31, 200 8 .’’. (c) M ODIFICATION OF ALTERNATIVE SIM P LIFIED CREDIT.— P ara- graph ( 5 )(A) of section 41(c) (relating to election of alternati v e simplified credit) is amended by stri k ing ‘‘12 percent’’ and inserting ‘‘14 percent (12 percent in the case of taxable years ending before J anuary 1, 2009)’’. (d) TEC H NICAL CORRECTION.—Paragraph (3) of section 41(h) is amended to read as follows: ‘‘(2) COMP U TATION FOR TA X A B LE Y EAR IN W HICH CREDIT TERMINATE S .—In the case of any taxable year with respect to which this section applies to a number of days which is less than the total number of days in such taxable year— ‘‘(A) the amount determined under subsection (c)(1)( B ) with respect to such taxable year shall be the amount which bears the same ratio to such amount (determined without regard to this paragraph) as the number of days in such taxable year to which this section applies bears to the total number of days in such taxable year, and ‘‘(B) for purposes of subsection (c)(5), the average q uali- fied research expenses for the preceding 3 taxable years shall be the amount which bears the same ratio to such average qualified research expenses (determined without regard to this paragraph) as the number of days in such taxable year to which this section applies bears to the total number of days in such taxable year.’’. (e) E FFECTIVE DATE.— (1) IN G ENERAL.—Except as provided in paragraph (2), the amendments made by this section shall apply to taxable years beginning after December 31, 2007. (2) EXTENSION.—The amendments made by subsection (a) shall apply to amounts paid or incurred after December 31, 2007. SEC.302 . N E WMARK E T STA X CRE DI T. Subparagraph (D) of section 45D(f)(1) (relating to national limitation on amount of investments designated) is amended by striking ‘‘and 2008’’ and inserting ‘‘2008, and 2009’’. SEC. 303. S UBP ART F EXCEPTI O N FOR ACTI V E FINANCIN G INCOME. (a) EXEMPT INSURANCE INCOME.—Paragraph (10) of section 953(e) (relating to application) is amended— (1) by striking ‘‘January 1, 2009’’ and inserting ‘‘January 1, 2010’’, and (2) by striking ‘‘December 31, 2008’’ and inserting ‘‘December 31, 2009’’. (b) EXCEPTION TO TREATMENT AS F OREIGN PERSONAL H OLDING COMPANY INCOME.—Paragraph (9) of section 954(h) (relating to application) is amended by striking ‘‘January 1, 2009’’ and inserting ‘‘January 1, 2010’’. 26USC41note.Ap p licab ilit y . 26 USC 41.
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