HR 2977 — CAN Act

Summary

Connect America Now Act or the CAN Act This bill allows an exclusion from gross income, for income tax purposes, of gain from the sale or exchange of the entire interest in a wholly-owned rural incumbent local exchange carrier. A rural incumbent local exchange carrier is a carrier that serves (1) an area where it was required to provide communications services by a specified date to any customer regardless of cost, and (2) an area other than an urbanized area with not fewer than 50,000 people and a core where there are not fewer than 1,000 people per square mile. The bill requires recapture of tax for income from the sale or exchange of stock in a carrier not held for at least one year. The bill allows an investment tax credit for 30% of expenditures to purchase, maintain, or improve property to provide voice telephone service or broadband internet access in rural empowerment zones. The bill increases the volume cap for private activity bonds and allows the use of bond proceeds for infrastructure for broadband internet access service.

Bill Text

• Introduced Introduced in House Current html May 04, 2021

AI-generated reading aid from the bill's amendatory text — verify against the official bill.

The bill creates tax exclusions and credits related to rural incumbent local exchange carriers and broadband investment.

• Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986

  SEC. 139I. GAIN FROM SALE OF RURAL INCUMBENT LOCAL EXCHANGE CARRIER STOCK. (a) Exclusion.--Gross income shall not include gain from the sale or exchange of the entire interest in a wholly-owned rural incumbent local exchange carrier.

  Establishes a new section to exclude gains from the sale of stock of rural incumbent local exchange carriers from gross income.

• Section 338(a) of the Internal Revenue Code of 1986

  For purposes of this subtitle → For purposes of this subtitle (other than section 139I)

  Excludes section 139I from certain subsections regarding the treatment of corporate acquisitions.

• Part XII of subchapter B of chapter 1 of the Internal Revenue Code of 1986

  PART XII--RECAPTURE OF EXCLUSION OF GAIN FROM SALE OF RURAL INCUMBENT LOCAL EXCHANGE CARRIER STOCK.

  Establishes a new part regarding the recapture of the gain exclusion for sales of rural incumbent local exchange carriers.

• Subpart E of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986

  SEC. 48D. RURAL COMMUNICATIONS INVESTMENT CREDIT. (a) In General.-- (1) Credit amount.--For the purposes of section 46, in the case of a rural incumbent local exchange carrier, the rural communications investment credit for any taxable year is an amount equal to 30 percent of the amounts that are paid or incurred by such carrier during any qualified 1-year period ending in such taxable year to purchase, maintain, or improve property for the purpose of providing voice telephone service or broadband internet access service in an area described in section 139I(c)(2).

  Creates a new tax credit for rural incumbent local exchange carriers investing in infrastructure.

• Section 146(d)(1) of the Internal Revenue Code of 1986

  the greater of → 120 percent of the greater of

  Increases the volume cap for private activity bonds.

• Section 142(a) of the Internal Revenue Code of 1986

  or → , or

  Expands eligible purposes for exempt facility bonds to include broadband infrastructure.

Action History

1. May 04, 2021

   Introduced in House

2. May 04, 2021

   Introduced in House

3. May 04, 2021

   Referred to the House Committee on Ways and Means.

Sponsors

• A. Drew Ferguson · Primary

Subjects