124 STAT. 2555 PUBLIC LAW 111–240—SEPT. 27, 2010 SEC. 2013. GENERAL BUSINESS CREDITS OF ELIGIBLE SMALL BUSINESSES IN 2010 NOT SUBJECT TO ALTERNATIVE MIN- IMUM TAX. (a) IN GENERAL.—Section 38(c) of the Internal Revenue Code of 1986 is amended by redesignating paragraph (5) as paragraph (6) and by inserting after paragraph (4) the following new para- graph: ‘‘(5) SPECIAL RULES FOR ELIGIBLE SMALL BUSINESS CREDITS IN 2010.— ‘‘(A) IN GENERAL.—In the case of eligible small business credits determined in taxable years beginning in 2010— ‘‘(i) this section and section 39 shall be applied separately with respect to such credits, and ‘‘(ii) in applying paragraph (1) to such credits— ‘‘(I) the tentative minimum tax shall be treated as being zero, and ‘‘(II) the limitation under paragraph (1) (as modified by subclause (I)) shall be reduced by the credit allowed under subsection (a) for the taxable year (other than the eligible small business credits). ‘‘(B) ELIGIBLE SMALL BUSINESS CREDITS.—For purposes of this subsection, the term ‘eligible small business credits’ means the sum of the credits listed in subsection (b) which are determined for the taxable year with respect to an eligible small business. Such credits shall not be taken into account under paragraph (2), (3), or (4). ‘‘(C) ELIGIBLE SMALL BUSINESS.—For purposes of this subsection, the term ‘eligible small business’ means, with respect to any taxable year— ‘‘(i) a corporation the stock of which is not publicly traded, ‘‘(ii) a partnership, or ‘‘(iii) a sole proprietorship, if the average annual gross receipts of such corporation, partnership, or sole proprietorship for the 3-taxable-year period preceding such taxable year does not exceed $50,000,000. For purposes of applying the test under the preceding sentence, rules similar to the rules of paragraphs (2) and (3) of section 448(c) shall apply. ‘‘(D) TREATMENT OF PARTNERS AND S CORPORATION SHAREHOLDERS.—Credits determined with respect to a part- nership or S corporation shall not be treated as eligible small business credits by any partner or shareholder unless such partner or shareholder meets the gross receipts test under subparagraph (C) for the taxable year in which such credits are treated as current year business credits.’’. (b) TECHNICAL AMENDMENT.—Section 55(e)(5) of the Internal Revenue Code of 1986 is amended by striking ‘‘38(c)(3)(B)’’ and inserting ‘‘38(c)(6)(B)’’. (c) CONFORMING AMENDMENTS.— (1) Subclause (II) of section 38(c)(2)(A)(ii) of the Internal Revenue Code of 1986 is amended by inserting ‘‘the eligible small business credits,’’ after ‘‘the New York Liberty Zone busi- ness employee credit,’’. 26 USC 55. Applicability. Definition. Definition. Applicability. 26 USC 38.
