Sec. 4. Tax Credits for New Hires
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Subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to refundable credits) is amended by inserting after section 36B the following new section: There shall be allowed as a credit against the tax imposed by this subtitle— for any taxable year beginning in 2014, an amount equal to 60 percent of the excess of— the aggregate wages paid during 2014, over the aggregate wages paid during 2013, and for any taxable year beginning in 2015, an amount equal to 40 percent of the excess of— the aggregate wages paid during 2015, over the aggregate inflation-adjusted wages paid during 2014.
The amount of the credit allowable under this section for any employer with respect to any calendar year shall not exceed $500,000. For purposes of subsection (a)— the amount taken into account under paragraph (1)(B) thereof shall not be less than 50 percent of the amount described in paragraph (1)(A) thereof, and the amount taken into account under paragraph (2)(B) thereof shall not be less than 50 percent of the amount described in paragraph (2)(A) thereof. The amount of credit allowed under this section for any taxable year shall not exceed the amount which would be so allowed for such year (without regard to subsection (c)) if— the aggregate amounts taken into account as wages were determined without any dollar limitation, and 103 percent of the amount of wages otherwise required to be taken into account under subsection (a)(1)(B) or subsection (a)(2)(B), as the case may be, were taken into account.
For purposes of this section: Except as provided in paragraph (2), the term wages has the meaning given to such term by section 3306(b). Rules similar to the rules of section 51(h) shall apply for purposes of this section. The term inflation-adjusted wages means the aggregate wages paid during 2014 increased by an amount equal to— such aggregate wages, multiplied by the cost-of-living adjustment determined under section 1(f)(3) for 2014, determined by substituting calendar year 2012 for calendar year 1992 in subparagraph
(B)thereof. Any increase determined under the preceding sentence shall be rounded in such manner as the Secretary shall prescribe. If, after December 31, 2012, an employer acquires the major portion of a trade or business of another person (hereinafter in this subparagraph referred to as the predecessor ) or the major portion of a separate unit of a trade or business of a predecessor, then, for purposes of applying this section for any calendar year ending after such acquisition, the amount of wages deemed paid by the employer during periods before such acquisition shall be increased by so much of such wages paid by the predecessor with respect to the acquired trade or business as is attributable to the portion of such trade or business acquired by the employer. If, after December 31, 2012— an employer disposes of the major portion of any trade or business of the employer or the major portion of a separate unit of a trade or business of the employer in a transaction to which subparagraph
(A)applies, and the employer furnishes the acquiring person such information as is necessary for the application of subparagraph (A), then, for purposes of applying this section for any calendar year ending after such disposition, the amount of wages deemed paid by the employer during periods before such disposition shall be decreased by so much of such wages as is attributable to such trade or business or separate unit. If— during 2013 or 2014 an individual has net earnings from self-employment (as defined in section 1402(a)) which are attributable to a trade or business, and for any portion of the succeeding calendar year such individual is an employee of such trade or business, then, for purposes of determining the credit allowable for a taxable year beginning in such succeeding calendar year, the employer’s aggregate wages for 2013 or 2014, as the case may be, shall be increased by an amount equal to so much of the net earnings referred to in subparagraph
(A)as does not exceed the median household income in the United States for 2013 or 2014, as the case may be. Rules similar to the following rules shall apply for purposes of this section: Section 51(f) (relating to remuneration must be for trade or business employment). Section 51(i)(1) (relating to related individuals ineligible). Section 51(k) (relating to treatment of successor employers; treatment of employees performing services for other persons). Section 52 (relating to special rules). If the employer has more than 1 taxable year beginning in 2014 or 2015, the credit under this section shall be determined for the employer’s last taxable year beginning in 2014 or 2015, as the case may be. . Subsection
(a)of section 280C of such Code is amended by inserting 36C(a), before 45A(a) . Section 1324(b)(2) of title 31, United States Code, is amended by inserting 36C, after 36B, . The table of sections for subpart C of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 36B the following new item: Sec. 36C. Credit for increasing employment. . The amendments made by this section shall apply to taxable years beginning after December 31, 2013.