Patriot Bonus Tax Credit Act of 2020
This bill allows employers a employment tax credit for qualified bonuses paid to their employees after March 12, 2020, and before January 1, 2021. The credit is equal to 50% of such bonuses paid in a calendar quarter taking into account not more than $25,000 for any employee for all calendar quarters.
The bill defines qualified bonus as wages paid to an employee that include overtime or hazardous pay, supplemental payments made for the convenience of the employer, payments to retain staff at essential facilities, or other payments made to employees due to extraordinary businesses and economic conditions.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6629 Introduced in House (IH)]
<DOC>
116th CONGRESS
2d Session
H. R. 6629
To provide a payroll tax credit to employers for employee bonuses.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 28, 2020
Mr. Huizenga introduced the following bill; which was referred to the
Committee on Ways and Means
_______________________________________________________________________
A BILL
To provide a payroll tax credit to employers for employee bonuses.
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 ``Patriot Bonus Tax Credit Act of
2020''.
SEC. 2. PAYROLL TAX CREDIT TO EMPLOYERS FOR EMPLOYEE BONUSES.
(a) In General.--In the case of an employer, there shall be allowed
as a credit against applicable employment taxes for each calendar
quarter an amount equal to 50 percent of the qualified bonuses with
respect to each employee of such employer for such calendar quarter.
(b) Limitations and Refundability.--
(1) Bonuses taken into account.--The amount of qualified
bonuses with respect to any employee which may be taken into
account under subsection (a) by the employer for all calendar
quarters shall not exceed $25,000.
(2) Credit limited to employment taxes.--The credit allowed
by subsection (a) with respect to any calendar quarter shall
not exceed the applicable employment taxes (reduced by any
credits allowed under subsections (e) and (f) of section 3111
of the Internal Revenue Code of 1986, sections 7001 and 7003 of
the Families First Coronavirus Response Act, and section 2301
of the CARES Act) on the wages paid with respect to the
employment of all the employees of the employer for such
calendar quarter.
(3) Refundability of excess credit.--
(A) In general.--If the amount of the credit under
subsection (a) exceeds the limitation of paragraph (2)
for any calendar quarter, such excess shall be treated
as an overpayment that shall be refunded under sections
6402(a) and 6413(b) of the Internal Revenue Code of
1986.
(B) Treatment of payments.--For purposes of section
1324 of title 31, United States Code, any amounts due
to the employer under this paragraph shall be treated
in the same manner as a refund due from a credit
provision referred to in subsection (b)(2) of such
section.
(c) Definitions.--For purposes of this section--
(1) Applicable employment taxes.--The term ``applicable
employment taxes'' means the following:
(A) The taxes imposed under section 3111(a) of the
Internal Revenue Code of 1986.
(B) So much of the taxes imposed under section
3221(a) of such Code as are attributable to the rate in
effect under section 3111(a) of such Code.
(2) Qualified bonus.--The term ``qualified bonus'' means
any wages paid by an employer to an employee for any period
with respect to a period for which such employee is providing
services to such employer. Such term shall not include any
wages except to the extent that such wages are in excess of the
wages which would ordinarily be paid to such employee. Wages
not ordinarily paid to an employee include amounts paid by the
employer in excess of the necessary and customary amounts paid
to the employee under normal business circumstances. Such
amounts include, but are not limited to, extraordinary payments
for overtime or hazardous pay, supplemental payments or
allowances given to the employee whether for the convenience of
the employer or otherwise, sequestration payments to retain
staff at essential facilities, or other payments for services
rendered which the employee would not be accustomed to
receiving absent the extraordinary business and economic
conditions existing during the applicable period.
(3) Secretary.--The term ``Secretary'' means the Secretary
of the Treasury or the Secretary's delegate.
(4) Wages.--The term ``wages'' means wages (as defined in
section 3121(a) of the Internal Revenue Code of 1986) and
compensation (as defined in section 3231(e) of such Code).
(5) Other terms.--Any term used in this section which is
also used in chapter 21 or 22 of the Internal Revenue Code of
1986 shall have the same meaning as when used in such chapter.
(d) Certain Rules To Apply.--For purposes of this section, rules
similar to the rules of sections 51(i)(1) and 280C(a) of the Internal
Revenue Code of 1986 shall apply.
(e) Certain Governmental Employers.--This credit shall not apply to
the Government of the United States, the government of any State or
political subdivision thereof, or any agency or instrumentality of any
of the foregoing.
(f) Election Not To Have Section Apply.--This section shall not
apply with respect to any employer for any calendar quarter if such
employer elects (at such time and in such manner as the Secretary may
prescribe) not to have this section apply.
(g) Third-Party Payors.--Any credit allowed under this section
shall be treated as a credit described in section 3511(d)(2) of such
Code.
(h) Transfers to Federal Old-Age and Survivors Insurance Trust
Fund.--There are hereby appropriated to the Federal Old-Age and
Survivors Insurance Trust Fund and the Federal Disability Insurance
Trust Fund established under section 201 of the Social Security Act (42
U.S.C. 401) and the Social Security Equivalent Benefit Account
established under section 15A(a) of the Railroad Retirement Act of 1974
(45 U.S.C. 14 231n-1(a)) amounts equal to the reduction in revenues to
the Treasury by reason of this section (without regard to this
subsection). Amounts appropriated by the preceding sentence shall be
transferred from the general fund at such times and in such manner as
to replicate to the extent possible the transfers which would have
occurred to such Trust Fund or Account had this section not been
enacted.
(i) Treatment of Deposits.--The Secretary shall waive any penalty
under section 6656 of the Internal Revenue Code of 1986 for any failure
to make a deposit of any applicable employment taxes if the Secretary
determines that such failure was due to the reasonable anticipation of
the credit allowed under this section.
(j) Regulations and Guidance.--The Secretary shall issue such
forms, instructions, regulations, and guidance as are necessary--
(1) to allow the advance payment of the credit under
subsection (a), subject to the limitations provided in this
section, based on such information as the Secretary shall
require;
(2) to provide for the reconciliation of such advance
payment with the amount advanced at the time of filing the
return of tax for the applicable calendar quarter or taxable
year; and
(3) with respect to the application of the credit under
subsection (a) to third-party payors (including professional
employer organizations, certified professional employer
organizations, or agents under section 3504 of the Internal
Revenue Code of 1986).
(k) Application.--This section shall only apply to qualified
bonuses paid after March 12, 2020, and before January 1, 2021.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
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