(at such time and in such form and manner as the Secretary shall prescribe) and allocated by the partnership or S corporation. Any income so designated shall be allocated amongst partners or shareholders in the same proportion as distributive or pro rata shares of income or loss are allocated. Such term shall not include any capital gains, interest, dividends, or royalties. (3) Special rules (A) Material participation Paragraph (1) shall not apply with respect to any income attributable to a trade or business in which the taxpayer does not materially participate. (B) Coordination with capital gains This subsection shall be applied before the application of subsection (h). . (b) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2017. 3. Repeal of limitation on election to expense certain depreciable asset in case of non-C Corp taxpayers (a) In general Paragraphs (1) and (2) of section 179(b) of the Internal Revenue Code of 1986 are each amended by striking The and inserting In the case of a corporation (or any partnership with a corporation as a partner), the . (b) Effective date The amendment made by this section shall apply to taxable years beginning after December 31, 2017. 4. Expanded availability of cash accounting rules and exception to inventory rules for certain small businesses (a) Cash accounting permitted (1) In general Section 446 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection: (g) Certain small business taxpayers permitted To use cash accounting method without limitation (1) In general With respect to an eligible taxpayer who uses the cash receipts and disbursements method for any taxable year, such method shall be deemed to clearly reflect income and the taxpayer shall not be required to use an accrual method. (2) Eligible taxpayer For purposes of this subsection, a taxpayer is an eligible taxpayer with respect to any taxable year if— (A) for all prior taxable years beginning after December