Firearm dealer serialization credit

(a) In general Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section: 45BB. Firearm dealer serialization credit (a) In general For purposes of section 38, in the case of a taxpayer who is licensed under section 923 of title 18, United States Code, to engage in the business of importing, manufacturing, or dealing in firearms, the firearm dealer serialization credit determined under this section for the taxable year shall be an amount equal to the firearm serialization expenditures of the taxpayer for the taxable year. (b) Firearm serialization expenditures For purposes of this section, the term firearm serialization expenditures means any amounts paid or incurred during the taxable year to comply with section 923(i)(3) of title 18, United States Code, including the purchase or lease of equipment (or related software) for the engraving or casting of firearms. (c) Limitation The amount of firearm serialization expenditures taken into account by the taxpayer under subsection (a) for any taxable year shall not exceed— (1) in the case of amounts paid or incurred for the purchase or lease of equipment (or related software) for engraving or casting firearm receivers or frames, $1,000, and (2) in the case of any other expenditures, the lesser of— (A) an amount that does not exceed $50 for each firearm the engraving or casting of which is required of the taxpayer under section 923(i)(3) of title 18, United States Code, or (B) $1,500. (d) Controlled groups Rules similar to the rules of paragraphs (1) and (2) of section 41(f) shall apply for purposes of this section. (e) Denial of double benefit (1) No deduction No deduction shall be allowed for any expenditures taken into account in determining the credit under this section for the taxable year. (2) Basis adjustment If a credit is determined under this section with respect to any property purchased by the taxpayer, the basis of such property shall be reduced by the amount of the credit so determined with respect to such property. (f) Termination (1) In general Except to the extent provided in paragraph (2), this section shall not apply to any amount paid or incurred more than 5 years after the date of the enactment of this section. (2) Extension If the Secretary (after consultation with the Director of the Bureau of Alcohol, Tobacco, Firearms and Explosives) certifies to Congress that the credit allowed under this section has improved firearm serialization and compliance with related Federal law, paragraph (1) shall be applied by substituting 7 years for 5 years.. (b) Credit made part of general business credit Section 38(b) of such Code is amended by striking plus at the end of paragraph (40), by striking the period at the end of paragraph (41) and inserting, plus, and by adding at the end the following new paragraph: (42) the firearm dealer serialization credit determined under section 45BB(a).. (c) Clerical amendment The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item: Sec. 45BB. Firearm dealer serialization credit.. (d) Effective date The amendments made by this section shall apply to amounts paid or incurred after the date of the enactment of this Act.