text: SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.
  
      (a) Short Title.--This Act may be cited as the ``Grow Research 
  Opportunities With Taxcredits' Help Act'' or ``GROWTH Act''.
      (b) Amendment of 1986 Code.--Except as otherwise expressly 
  provided, whenever in this Act an amendment or repeal is expressed in 
  terms of an amendment to, or repeal of, a section or other provision, 
  the reference shall be considered to be made to a section or other 
  provision of the Internal Revenue Code of 1986.
  
  SEC. 2. EXTENSION OF RESEARCH CREDIT; INCREASE IN ALTERNATIVE 
                SIMPLIFIED RESEARCH CREDIT.
  
      (a) Extension of Credit.--
              (1) In general.--Subparagraph (B) of section 41(h)(1) is 
          amended by striking ``December 31, 2009'' and inserting 
          ``December 31, 2010''.
              (2) Conforming amendment.--Subparagraph (D) of section 
          45C(b)(1) is amended by striking ``December 31, 2009'' and 
          inserting ``December 31, 2010''.
              (3) Effective date.--The amendments made by this subsection 
          shall apply to amounts paid or incurred after December 31, 
          2009.
      (b) Alternative Simplified Research Credit Increased.--
              (1) Increased credit.--Paragraph (5) of section 41(c) 
          (relating to election of alternative simplified credit) is 
          amended--
                      (A) by striking ``14 percent (12 percent in the 
                  case of taxable years ending before January 1, 2009)'' 
                  in subparagraph (A) and inserting ``20 percent'', and
                      (B) by striking ``6 percent'' in subparagraph 
                  (B)(ii) and inserting ``10 percent''.
              (2) Effective date.--The amendment made by this subsection 
          shall apply to taxable years beginning after the date of the 
          enactment of this Act.
  
  SEC. 3. MODIFICATION OF RESEARCH CREDIT AFTER 2010.
  
      (a) Simplified Credit for Qualified Research Expenses.--Subsection 
  (a) of section 41 is amended to read as follows:
      ``(a) General Rule.--
              ``(1) Credit determined.--For purposes of section 38, the 
          research credit determined under this section for the taxable 
          year shall be an amount equal to 20 percent of so much of the 
          qualified research expenses for the taxable year as exceeds 50 
          percent of the average qualified research expenses for the 3 
          taxable years preceding the taxable year for which the credit 
          is being determined.
              ``(2) Special rule in case of no qualified research 
          expenses in any of 3 preceding taxable years.--
                      ``(A) Taxpayers to which paragraph applies.--The 
                  credit under this section shall be determined under 
                  this paragraph if the taxpayer has no qualified 
                  research expenses in any one of the 3 taxable years 
                  preceding the taxable year for which the credit is 
                  being determined.
                      ``(B) Credit rate.--The credit determined under 
                  this paragraph shall be equal to 10 percent of the 
                  qualified research expenses for the taxable year.''.
      (b) Conforming Amendments.--
              (1) Termination of base amount calculation.--Section 41 is 
          amended by striking subsection (c) and redesignating subsection 
          (d) as subsection (c).
              (2) Termination of basic research payment calculation.--
          Section 41 is amended by striking subsection (e) and 
          redesignating subsections (f) and (g) as subsections (d) and 
          (e), respectively.
              (3) Special rules.--
                      (A) Paragraph (1)(A)(ii) of subsection (d) of 
                  section 41, as so redesignated, is amended by striking 
                  ``shares of the qualified research expenses, basic 
                  research payments, and amounts paid or incurred to 
                  energy research consortiums,'' and inserting ``share of 
                  the qualified research expenses''.
                      (B) Paragraph (1)(B)(ii) of section 41(d), as so 
                  redesignated, is amended by striking ``shares of the 
                  qualified research expenses, basic research payments, 
                  and amounts paid or incurred to energy research 
                  consortiums,'' and inserting ``share of the qualified 
                  research expenses''.
                      (C) Paragraph (3) of section 41(d), as so 
                  redesignated, is amended--
                              (i) by striking ``, and the gross receipts 
                          of the taxpayer'' and all that follows in 
                          subparagraph (A) and inserting a period,
                              (ii) by striking ``, and the gross receipts 
                          of the taxpayer'' and all that follows in 
                          subparagraph (B) and inserting a period, and
                              (iii) by striking subparagraph (C).
                      (D) Paragraph (4) of section 41(d), as so 
                  redesignated, is amended by striking ``and gross 
                  receipts''.
                      (E) Subsection (d) of section 41, as so 
                  redesignated, is amended by striking paragraph (6).
              (4) Permanent extension.--
                      (A) Section 41 is amended by striking subsection 
                  (h).
                      (B) Paragraph (1) of section 45C(b) is amended by 
                  striking subparagraph (D).
              (5) Cross-references.--
                      (A) Paragraphs (2)(A) and (4) of section 41(b) are 
                  each amended by striking ``subsection (f)(1)'' and 
                  inserting ``subsection (d)(1)''.
                      (B) Paragraph (2) of section 45C(c) is amended by 
                  striking ``base period research expenses'' and 
                  inserting ``average qualified research expenses''.
                      (C) Paragraph (3) of section 45C(d) is amended by 
                  striking ``section 41(f)'' and inserting ``section 
                  41(d)''.
                      (D) Paragraph (2) of section 45G(e) is amended by 
                  striking ``section 41(f)'' and inserting ``section 
                  41(d)''.
                      (E) Subsection (g) of section 45O is amended by 
                  striking ``section 41(f)'' and inserting ``section 
                  41(d)''.
                      (F) Subparagraph (A) of section 54(l)(3) is amended 
                  by striking ``section 41(g)'' and inserting ``section 
                  41(e)''.
                      (G) Clause (i) of section 170(e)(4)(B) is amended 
                  to read as follows:
                              ``(i) the contribution is to a qualified 
                          organization,''.
                      (H) Paragraph (4) of section 170(e) is amended by 
                  adding at the end the following new subparagraph:
                      ``(E) Qualified organization.--For purposes of this 
                  paragraph, the term `qualified organization' means--
                              ``(i) any educational organization which--
                                      ``(I) is an institution of higher 
                                  education (within the meaning of 
                                  section 3304(f)), and
                                      ``(II) is described in subsection 
                                  (b)(1)(A)(ii), or
                              ``(ii) any organization not described in 
                          clause (i) which--
                                      ``(I) is described in section 
                                  501(c)(3) and is exempt from tax under 
                                  section 501(a),
                                      ``(II) is organized and operated 
                                  primarily to conduct scientific 
                                  research, and
                                      ``(III) is not a private 
                                  foundation.''.
                      (I) Subsection (f) of section 197 is amended by 
                  striking ``section 41(f)(1)'' each place it appears in 
                  paragraphs (1)(C) and (9)(C)(i) and inserting ``section 
                  41(d)(1)''.
                      (J) Section 280C is amended--
                              (i) by striking ``41(f)'' each place it 
                          appears in subsection (b)(3) and inserting 
                          ``41(d)'',
                              (ii) by striking ``or basic research 
                          expenses (as defined in section 41(e)(2))'' in 
                          subsection (c)(1),
                              (iii) by striking ``section 41(a)(1)'' in 
                          subsection (c)(2)(A) and inserting ``section 
                          41(a)'', and
                              (iv) by striking ``or basic research 
                          expenses'' in subsection (c)(2)(B).
                      (K) Subclause (IV)(c) of section 936(h)(5)(C)(i) is 
                  amended by striking ``section 41(f)'' and inserting 
                  ``section 41(d)''.
                      (L) Subparagraph (D) of section 936(j)(5) is 
                  amended by striking ``section 41(f)(3)'' and inserting 
                  ``section 41(d)(3)''.
                      (M) Clause (i) of section 965(c)(2)(C) is amended 
                  by striking ``section 41(f)(3)'' and inserting 
                  ``section 41(d)(3)''.
                      (N) Clause (i) of section 1400N(l)(7)(B) is amended 
                  by striking ``section 41(g)'' and inserting ``section 
                  41(e)''.
      (c) Technical Corrections.--Section 409 is amended--
              (1) by inserting ``, as in effect before the enactment of 
          the Tax Reform Act of 1984)'' after ``section 41(c)(1)(B)'' in 
          subsection (b)(1)(A),
              (2) by inserting ``, as in effect before the enactment of 
          the Tax Reform Act of 1984'' after ``relating to the employee 
          stock ownership credit'' in subsection (b)(4),
              (3) by inserting ``(as in effect before the enactment of 
          the Tax Reform Act of 1984)'' after ``section 41(c)(1)(B)'' in 
          subsection (i)(1)(A),
              (4) by inserting ``(as in effect before the enactment of 
          the Tax Reform Act of 1984)'' after ``section 41(c)(1)(B)'' in 
          subsection (m),
              (5) by inserting ``(as so in effect)'' after ``section 
          48(n)(1)'' in subsection (m),
              (6) by inserting ``(as in effect before the enactment of 
          the Tax Reform Act of 1984)'' after ``section 48(n)'' in 
          subsection (q)(1), and
              (7) by inserting ``(as in effect before the enactment of 
          the Tax Reform Act of 1984)'' after ``section 41'' in 
          subsection (q)(3).
      (d) Effective Date.--
              (1) In general.--Except as provided in paragraph (2), the 
          amendments made by this section shall apply to taxable years 
          beginning after December 31, 2010.
              (2) Technical corrections.--The amendments made by 
          subsection (c) shall take effect on the date of the enactment 
          of this Act.
target: Grow Research Opportunities With Taxcredits' Help Act or GROWTH Act - Amends the Internal Revenue Code to: (1) extend the tax credit for increasing research activities through 2010; (2) modify the rate of such credit and make such modified credit permanent after 2010; and (3) increase to 20% the rate of the alternative simplified research tax credit after 2010.
feat_title: A bill to amend the Internal Revenue Code of 1986 to extend the research credit through 2010 and to increase and make permanent the alternative simplified research credit, and for other purposes.