PlainBillCongress, translated.Legislation. Context. Public interest.Referred to the House Committee on Ways and Means.
Congressional Research Service
Version 00 · Introduced in House · Feb 13, 2025
Veterans Jobs Opportunity Act
This bill allows veteran-owned small businesses in underserved communities to claim a tax credit for qualified start-up expenses in the amount of 15% (up to $50,000) of such expenses. (Conditions and limitations apply.)
Under the bill, a business qualifies for the veteran small business start-up tax credit if it
Showing the opening paragraphs of the official summary.
is owned and controlled by one or more veterans (or spouses of veterans);
is located in a Historically Underutilized Business Zone (HUBZone) program area, empowerment zone or enterprise community, an area of low or moderate income, or county with persistent poverty; and
has gross receipts for the prior tax year of $5 million or less (or employed 50 or fewer full-time employees in the prior tax year).
The bill generally defines qualified start-up expenses as amounts incurred or paid to
investigate the creation or acquisition of the business,
create the business,
engage in activities for the production of income before the day the business opens, and
purchase or lease real property (or purchase personal property) for use in the active conduct of a trade or business.
However, under the bill, the veteran small business start-up tax credit is allowed only in the first two tax years for which a business may claim a tax deduction for ordinary and necessary trade or business expenses.
Finally, the bill requires the Treasury Inspector General for Tax Administration to provide an evaluation of the veteran small business start-up tax credit to Congress every four years.
People & committees
Rep. Davis, Donald G. [D-NC-1] · D–NC
Legislative record
A procedural vote is different from passage. Passage in one chamber does not establish enactment. Explore the glossary.
Referred to the House Committee on Ways and Means.
Introduced in House
Introduced in House
Primary sources
Text links open the official source. We also preserved the text version used in the PlainBill explanation below.
Source last updated: Feb 19, 2026. Consult Congress.gov for the current record.
AI Conversation Starters
Choose a perspective, copy a prompt, and paste it into your preferred AI. Each prompt includes the bill version and available official source links, and asks for counterarguments as well as supporting evidence.
Analyze H.R.1298 as objectively as possible. Explain its main provisions, who would be affected, possible benefits and harms, implementation, exceptions, and uncertainties. Present the strongest arguments for and against it, and identify evidence needed to assess its public impact.
Examine H.R.1298 through a progressive lens, focusing on fairness, access, economic inequality, and effects on vulnerable communities. Explain potential benefits, costs, and unintended consequences. Consider the strongest counterarguments and distinguish stated goals from demonstrated outcomes.
Examine H.R.1298 through a conservative lens, focusing on fiscal responsibility, institutional stability, federalism, and the scope of government. Explain potential benefits, costs, and unintended consequences. Consider the strongest counterarguments and any provisions that challenge this perspective.
Examine H.R.1298 through a civil-liberties and limited-government lens. Consider individual rights, privacy, voluntary choice, accountability, and government power. Explain tradeoffs, possible safeguards, and the strongest counterarguments without assuming the proposal is beneficial or harmful.
PlainBill explanation
Based on the full Introduced in House · 2025-02-13 text. This explanation has not received human editorial review. This overview describes the proposal’s major provisions; it does not establish what its real-world effects would be.
The proposed Veterans Jobs Opportunity Act would create a tax credit for qualifying small businesses owned and actively operated by veterans or their spouses in designated underserved communities. The credit would equal 15% of up to $50,000 in eligible expenses per tax year. Businesses could elect it only for their first two tax years in which ordinary business expenses are deductible. These are proposed changes, not evidence of an enacted tax benefit.
This Act may be cited as the Veterans Jobs Opportunity Act.
the veteran small business start-up credit determined under this section for any taxable year is an amount equal to 15 percent of so much of the qualified start-up expenditures paid or incurred by the taxpayer during such taxable year with respect to an applicable veteran-owned business as does not exceed $50,000.
The term applicable veteran-owned small business means a small business— (A) owned and controlled by 1 or more veterans or spouses of veterans, and (B) the principal place of business of which is in an underserved community.
The taxpayer may elect the application of this section only for the first 2 taxable years for which ordinary and necessary expenses paid or incurred in carrying on such trade or business are allowable as a deduction by the taxpayer under section 162.
The proposed credit would be calculated on eligible expenses paid or incurred during the tax year. Its 15% rate and $50,000 expense limit yield a maximum calculated credit of $7,500 per tax year, before any applicable restrictions under other tax provisions.
For purposes of section 38, the veteran small business start-up credit determined under this section for any taxable year is an amount equal to 15 percent of so much of the qualified start-up expenditures paid or incurred by the taxpayer during such taxable year with respect to an applicable veteran-owned business as does not exceed $50,000.
Eligibility would require veteran or spouse ownership and control, with the business's principal location in an underserved community. The owners' business activity could not be passive under the referenced tax rule. The ownership rules cover sole proprietorships, corporations with more than 50% veteran or spouse ownership by voting power or value, and partnerships with more than 50% ownership of profits or capital interests.
The term applicable veteran-owned small business means a small business— (A) owned and controlled by 1 or more veterans or spouses of veterans, and (B) the principal place of business of which is in an underserved community.
The term owned and controlled means— (A) with respect to any of the individuals described in paragraph (1)(A), that the conduct of any trade or business of the small business is not a passive activity (as defined in section 469(c)), and (B) with respect to the small business— (i) such small business is a sole proprietorship, (ii) if such small business is a corporation, ownership (by vote or value) by the individuals described in paragraph (1)(A) of greater than 50 percent of the stock in such corporation, or (iii) if such small business is a partnership, ownership by the individuals described in paragraph (1)(A) of greater than 50 percent of the profits interests or capital interests in such partnership.
The proposal would use the Small Business Act's referenced definition of a veteran or veteran's spouse, fixed as of enactment. That definition is not reproduced in the bundle.
The term veteran or spouse of a veteran has the meaning given such term by section 7(a)(31)(G)(ii) of the Small Business Act (15 U.S.C. 636(a)(31)(G)(ii), as in effect on the date of enactment of this section).
A qualifying small business would have to conduct business in the United States. It would qualify by having no more than $5 million in gross receipts—business receipts before subtracting expenses—in the preceding tax year, or, where that test does not apply, no more than 50 full-time employees in that year. Full-time would mean at least 30 hours per week for at least 20 calendar weeks in the tax year.
The term small business means, with respect to any taxable year, any person engaged in a trade or business in the United States if— (i) the gross receipts of such person for the preceding taxable year did not exceed $5,000,000, or (ii) in the case of a person to which clause (i) does not apply, such person employed not more than 50 full-time employees during the preceding taxable year.
an employee shall be considered full-time if such employee is employed at least 30 hours per week for 20 or more calendar weeks in the taxable year.
Eligible expenses would include start-up expenses under the referenced tax definition. They would also include amounts paid or incurred during the tax year to buy or lease real estate or buy other property, provided that property is placed in service that year and used in actively conducting the business.
The term qualified start-up expenditures means— (A) any start-up expenditures (as defined in section 195(c)), and (B) any amounts paid or incurred during the taxable year for the purchase or lease of real property, or the purchase of personal property, placed in service during the taxable year and used in the active conduct of a trade or business.
Eligible locations would include HUBZones, a federally defined business-zone category; designated empowerment zones or enterprise communities, even if their designations have expired; federally recognized low- or moderate-income areas; and counties classified as having persistent poverty. The HUBZone definition would be fixed as of enactment.
The term underserved community means any area located within— (A) a HUBZone (as defined in section 3(p) of the Small Business Act (15 U.S.C. 632(p)), as in effect on the date of enactment of this section), (B) an empowerment zone, or enterprise community, designated under section 1391 (and without regard to whether or not such designation remains in effect), (C) an area of low income or moderate income (as recognized by the Federal Financial Institutions Examination Council), or (D) a county with persistent poverty (as classified by the Economic Research Service of the Department of Agriculture).
Taxpayers would have to choose to apply the credit to particular expenses; it would not apply automatically. That choice would be available only for the first two tax years in which ordinary and necessary expenses of operating the business are deductible under section 162.
No credit shall be allowed under subsection (a) for any expenditures unless the taxpayer elects to have this section apply to such expenditures.
The taxpayer may elect the application of this section only for the first 2 taxable years for which ordinary and necessary expenses paid or incurred in carrying on such trade or business are allowable as a deduction by the taxpayer under section 162.
Businesses or other persons grouped as a single employer under the referenced common-control tax rules would be treated as one person for this credit.
All persons treated as a single employer under subsections (a) and (b) of section 52 shall be treated as 1 person.
If the credit were calculated for property, the taxpayer would have to reduce that property's tax basis—the value used for tax calculations—by the credit attributable to it. The bill labels this a rule against a double benefit.
(4) No double benefit If a credit is determined under this section with respect to any property, the basis of such property shall be reduced by the amount of the credit attributable to such property.
The proposal would add the new credit to the general business credit, the tax-code framework that groups business tax credits. The supplied text does not reproduce that framework's rules governing how much credit a taxpayer can actually use.
(c) 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 veteran small business start-up credit determined under section 45BB.
Every fourth year after enactment, the Treasury Inspector General for Tax Administration would have to evaluate the credit's success and accountability in one of its twice-yearly reports.
Every fourth year after the date of the enactment of this Act, the Treasury Inspector General for Tax Administration shall include in one of the semiannual reports under section 5 of the Inspector General Act of 1978 with respect to such year, an evaluation of the credit allowed under section 45BB of the Internal Revenue Code of 1986 (as added by this section), including an evaluation of the success of, and accountability with respect to, such credit.
The tax amendments would apply to tax years beginning after enactment, rather than taking effect on a specified calendar date.
The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.
The supplied official-actions snapshot, updated February 19, 2026, records introduction in the House and referral to the House Committee on Ways and Means on February 13, 2025.
Source snapshot updated 2026-02-19T14:50:05Z. 2025-02-13: Referred to the House Committee on Ways and Means. 2025-02-13: Introduced in House
A closer look
Reviewed version: Introduced in House · 2025-02-13. These findings describe provisions and who may benefit; they are not judgments of waste, corruption, or motive.
This review covers the supplied bill text. “None identified” does not rule out provisions in later versions or accompanying reports and disclosures.
Provisions outside the bill’s main subject, or policy changes attached to appropriations.
None identified in the reviewed text
No unrelated provision or policy change attached to appropriations was identified in the complete supplied introduced text. This conclusion is limited to that version and does not establish attachment history or the contents of other versions or accompanying materials.
Spending directed to particular recipients or places outside ordinary competitive or formula-based allocation.
None identified in the reviewed text
No congressionally directed spending for particular recipients or places was identified in the complete supplied introduced text. This conclusion is limited to that version; the bundle does not contain disclosures or committee materials that could establish formal earmark status elsewhere.
Narrow exceptions, exemptions, or preferential treatment that warrant a closer look.
None identified in the reviewed text
No separate narrow carve-out, special exemption, or preferential exception warranting a finding was identified in the complete supplied introduced text. The program's intended beneficiaries and ordinary eligibility rules alone do not qualify under this review's definition. This conclusion does not extend to other versions or accompanying materials.
Full text preserved for this analysis. Legislative record snapshot: Feb 19, 2026. How PlainBill uses AI