A bill to amend the Internal Revenue Code of 1954 to permit small businesses to reduce the value of excess inventory.

Amends the Internal Revenue Code to permit a domestic trade or business whose equity capital does not exceed $25,000,000 to reduce the value of a portion of excess inventory items held for more than 12 months.

Permits a taxpayer who is required to change his method of accounting pursuant to Revenue Ruling 80-60 (inventory valuation) and Revenue Procedure 80-5 to effect such a change only for taxable years beginning after December 31, 1980.