The Broadband SALE Act is a tax incentive bill designed to encourage investment in broadband internet and phone service in rural America. Here's what it does: If someone owns a rural phone company that serves sparsely populated areas and sells their entire business, they can exclude the profits from that sale from their income taxes—meaning they won't owe federal income tax on those gains. This is meant to make it more attractive for people to sell these rural phone companies, potentially to buyers who might invest in upgrading their broadband infrastructure. The bill also offers a tax credit worth 30% of the cost for anyone who spends money to build, maintain, or improve broadband internet or phone service in designated rural areas. However, there's a catch: if someone buys stock in one of these rural phone companies hoping to benefit from this tax break, they have to hold onto that stock for at least a year, or they'll have to pay back some of the tax benefits they received. Essentially, this bill uses tax breaks to incentivize investment in broadband and phone service in rural communities that might otherwise be unprofitable for companies to serve.

Broadband SALE Act

Ferguson, A. Drew

Broadband Stock Acquisition in Local Exchanges Act or the 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.