A bill to amend the Internal Revenue Code of 1954 with respect to the income tax treatment of small business investment companies and shareholders in such companies.

Provides special rules for small business investment companies under the Internal Revenue Code. States that a small business investment company licensed under the Small Business Investment Act shall be considered a regulated investment company, provided that at the close of each taxable year: (1) at least 50 percent of the value of its total assets is represented by specified cash items and securities; and (2) not more than 25 percent of the value of its total assets is invested in the securities of any one issuer, or of two or more issuers which the taxpayer controls and which are engaged in similar or related trades or businesses.