H.R. 1178: Broadband SALE 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.

Written by the Congressional Research Service, Library of Congress.