Sec. 301. Government Match Tax Credit
884 words·~4 min read·
/bill/118/s/3102/is/section-301A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Subpart A of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 25E the following new section: In the case of an eligible individual, there shall be allowed as a credit for the taxable year an amount equal to the sum of— 1 percent of the eligible individual’s gross income, plus the applicable percentage of the participant’s contributions to the American Worker Retirement Fund during the taxable year. For purposes of this section, the applicable percentage is— 100 percent of so much of the contributions to the American Worker Retirement Fund as do not exceed 3 percent of gross income, 50 percent of so much of such contributions as exceeds 3 percent but does not exceed 5 percent of gross income, and 0 percent of so much of such contributions as exceeds 5 percent of gross income.
The credit allowed under subsection
(a)with respect to any eligible individual for a taxable year shall not exceed 5 percent of the phaseout amount with respect to such individual for such taxable year. The limit determined under paragraph
(1)for a taxable year shall be reduced by $75 for each $1,000 or portion thereof by which the eligible individual’s gross income exceeds the phaseout amount. For purposes of this subsection, the phaseout amount is— in the case of a joint return, an amount equal to 200 percent of the applicable median income for the taxable year, in the case of a head of household (as defined in section 2(b)), 3/4 of the amount determined under subparagraph (A), and in any other case, 1/2 of the amount determined under subparagraph (A). For purposes of this subsection, the term applicable median income means, with respect to any taxable year, an amount equal to the most recent Median Personal Income for the population 15 and over in the United States, as published in the United States Census Bureau's Current Population Survey Tables for Personal Income before the beginning of the calendar year in which such taxable year begins. For purposes of this section, the term eligible individual has the meaning given the term participant by section 2(13) of the Retirement Savings for Americans Act of 2023 . For purposes of this section, the American Worker Retirement Fund is the Fund created under section 101(a) of the Retirement Savings for Americans Act of 2023 . Any amount allowed as a credit under subsection (a)— shall not be allowed as a credit against any tax imposed by this subtitle, and shall be treated as an overpayment under section 6401(b). The Secretary shall contribute the amount treated as an overpayment under paragraph
(1)to the eligible individual’s account with the American Worker Retirement Fund. The rules of section 6433(f)(5) shall apply to any payment to which this subsection applies. The Secretary shall prescribe regulations to provide that the payments made under subsection
(f)are made as concurrently as is reasonably possible with contributions by a taxpayer to the American Worker Retirement Fund. Such regulations shall provide that, for purposes of such payments, the credit under subsection
(a)may be determined on the basis of the eligible individual’s gross income for the preceding taxable year. If the aggregate amount of payments under subsection
(f)with respect to an eligible individual for any taxable year exceeds the amount of the credit allowed under subsection
(a)to such individual for such taxable year, the tax imposed by this chapter for such taxable year shall be increased by the amount of such excess. Any failure to so increase the tax shall be treated as arising out of a mathematical or clerical error and assessed according to section 6213(b)(1). If any contribution described in subsection
(a)does not remain in the American Worker Retirement Fund for at least 6 months after such contribution is made, the amount of the credit under this section attributable to such contribution shall be forfeited as provided in paragraph (2). In the case of any contribution to which paragraph
(1)applies— the Executive Director of the American Worker Retirement Fund, as appointed under section 203 of the Retirement Savings for Americans Act of 2023 , shall make a distribution from the individual’s account in an amount equal to such contribution to the Secretary for deposit into the general fund of the Treasury, and in the case of any earnings on such contribution, such earnings shall be distributed by such Executive Director from the individual’s account and shall be available to the Executive Director, without need of further appropriation, for administrative expenses described in section 101(e) of such Act. Any distribution made under paragraph
(2)shall not be includible in the gross income of the individual. Any contribution by an individual to the American Worker Retirement Fund for a taxable year shall not be treated as a qualified retirement savings contribution of such individual for purposes of section 25B. . The table of sections for subpart A of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 26E the following new item: Sec. 25F. Government Match Tax Credit. . The amendments made by this section shall apply to taxable years beginning after December 31, 2022.