Small Business Tax Credit Accessibility Act

Small Business Tax Credit Accessibility Act

Amends the Internal Revenue Code, with respect to the small employer health care insurance tax credit, to: (1) revise the definition of "eligible small employer" to mean an employer with not more than 50 (currently, 25) full-time employees; (2) modify the phaseout formula for such credit to base such phaseout on number of employees and average annual wages; (3) extend from two to three consecutive taxable years the period during which an employer may claim such credit; and (4) eliminate the requirement that employers contribute the same percentage of cost of each employee's health insurance and the cap limiting eligible employer contributions to average premiums paid to a state health insurance exchange.

[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[S. 379 Introduced in Senate (IS)]

114th CONGRESS
  1st Session
                                 S. 379

  To amend the Internal Revenue Code of 1986 to expand and modify the 
   credit for employee health insurance expenses of small employers.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            February 5, 2015

    Mr. Coons (for himself, Mr. Merkley, Mr. King, Mr. Manchin, Ms. 
    Heitkamp, Mrs. Shaheen, Mr. Kaine, Mr. Franken, and Ms. Hirono) 
introduced the following bill; which was read twice and referred to the 
                          Committee on Finance

_______________________________________________________________________

                                 A BILL


 
  To amend the Internal Revenue Code of 1986 to expand and modify the 
   credit for employee health insurance expenses of small employers.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Small Business Tax Credit 
Accessibility Act''.

SEC. 2. EXPANSION AND MODIFICATION OF CREDIT FOR EMPLOYEE HEALTH 
              INSURANCE EXPENSES OF SMALL EMPLOYERS.

    (a) Expansion of Definition of Eligible Small Employer.--
Subparagraph (A) of section 45R(d)(1) of the Internal Revenue Code of 
1986 is amended by striking ``25'' and inserting ``50''.
    (b) Amendment to Phaseout Determination.--Subsection (c) of section 
45R of the Internal Revenue Code of 1986 is amended to read as follows:
    ``(c) Phaseout of Credit Amount Based on Number of Employees and 
Average Wages.--The amount of the credit determined under subsection 
(b) (without regard to this subsection) shall be adjusted (but not 
below zero) by multiplying such amount by the product of--
            ``(1) the lesser of--
                    ``(A) a fraction the numerator of which is the 
                excess (if any) of 50 over the total number of full-
                time equivalent employees of the employer and the 
                denominator of which is 30, and
                    ``(B) 1, and
            ``(2) the lesser of--
                    ``(A) a fraction--
                            ``(i) the numerator of which is the excess 
                        (if any) of--
                                    ``(I) the dollar amount in effect 
                                under subsection (d)(3)(B) for the 
                                taxable year, multiplied by 3, over
                                    ``(II) the average annual wages of 
                                the employer for such taxable year, and
                            ``(ii) the denominator of which is the 
                        dollar amount so in effect under subsection 
                        (d)(3)(B), multiplied by 2, and
                    ``(B) 1.''.
    (c) Extension of Credit Period.--Paragraph (2) of section 45R(e) of 
the Internal Revenue Code of 1986 is amended by striking ``2-
consecutive-taxable year period'' and all that follows and inserting 
``3-consecutive-taxable year period beginning with the 1st taxable year 
beginning after 2014 in which--
                    ``(A) the employer (or any predecessor) offers 1 or 
                more qualified health plans to its employees through an 
                Exchange, and
                    ``(B) the employer (or any predecessor) claims the 
                credit under this section.''.
    (d) Average Annual Wage Limitation.--Subparagraph (B) of section 
45R(d)(3) of the Internal Revenue Code of 1986 is amended to read as 
follows:
                    ``(B) Dollar amount.--For purposes of paragraph 
                (1)(B) and subsection (c)(2), the dollar amount in 
                effect under this paragraph is the amount equal to 110 
                percent of the poverty line (within the meaning of 
                section 36B(d)(3)) for a family of 4.''.
    (e) Elimination of Uniform Percentage Contribution Requirement.--
Paragraph (4) of section 45R(d) of the Internal Revenue Code of 1986 is 
amended by striking ``a uniform percentage (not less than 50 percent)'' 
and inserting ``at least 50 percent''.
    (f) Elimination of Cap Relating to Average Local Premiums.--
Subsection (b) of section 45R of the Internal Revenue Code of 1986 is 
amended by striking ``the lesser of'' and all that follows and 
inserting ``the aggregate amount of nonelective contributions the 
employer made on behalf of its employees during the taxable year under 
the arrangement described in subsection (d)(4) for premiums for 
qualified health plans offered by the employer to its employees through 
an Exchange.''.
    (g) Conforming Amendment Relating to Annual Wage Limitation.--
Subparagraph (B) of section 45R(d)(1) of the Internal Revenue Code of 
1986 is amended by striking ``twice'' and inserting ``three times''.
    (h) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred in taxable years beginning after 
December 31, 2014.
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