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[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 3265 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
1st Session
S. 3265
To amend the Internal Revenue Code of 1986 to improve and enhance the
work opportunity tax credit, to encourage longer-service employment,
and to modernize the credit to make it more effective as a hiring
incentive for targeted workers, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
November 20, 2025
Mr. Cassidy (for himself, Ms. Hassan, Mr. Boozman, Mr. Kaine, Mr.
Marshall, Mr. Welch, Mr. Moran, Mr. Justice, and Ms. Cortez Masto)
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 improve and enhance the
work opportunity tax credit, to encourage longer-service employment,
and to modernize the credit to make it more effective as a hiring
incentive for targeted workers, and for other purposes.
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 ``Improve and Enhance the Work
Opportunity Tax Credit Act''.
SEC. 2. IMPROVING AND ENHANCING WORK OPPORTUNITY TAX CREDIT.
(a) Extension.--Section 51(c)(4) of the Internal Revenue Code of
1986 is amended by striking ``December 31, 2025'' and inserting
``December 31, 2030''.
(b) Enhancement of Credit.--
(1) In general.--Section 51(a) of the Internal Revenue Code
of 1986 is amended--
(A) by striking ``shall be equal to 40 percent''
and all that follows and inserting the following:
``shall be equal to the sum of--
``(1) 50 percent of so much of the qualified first-year
wages with respect to each individual for such year as does not
exceed $6,000, plus
``(2) in the case of individuals who have performed at
least 400 hours of service for the employer, 50 percent of so
much of the qualified first-year wages with respect to each
such individual for such year as exceeds the dollar amount in
effect under paragraph (1) and does not exceed twice such
dollar amount.''.
(2) Inflation adjustments.--Section 51 of such Code is
amended by adding at the end the following new subsection:
``(l) Inflation Adjustment.--
``(1) In general.--In the case of any taxable year
beginning after 2025, the $6,000 amount in subsections (a)(1)
and each of the $10,000 amount in subsection (e)(1) shall be
increased by an amount equal to--
``(A) such dollar amount, multiplied by
``(B) the cost-of-living adjustment determined
under section 1(f)(3) for the calendar year in which
the taxable year begins, determined by substituting
`calendar year 2024' for `calendar year 2016' in
subparagraph (A)(ii) thereof.
``(2) Rounding.--Any increase determined under paragraph
(1) shall be rounded to the next nearest multiple of $100.''.
(3) Conforming amendments.--
(A) Limitation on wages taken into account for
certain veterans.--Section 51(b)(3) of such Code is
amended to read as follows:
``(3) Increased limitation on wages taken into account for
certain veterans.--
``(A) In general.--In the case of any qualified
veteran described in subparagraph (B), subsection (a)
shall be applied by substituting `the applicable
amount' for `$6,000'.
``(B) Applicable amount.--For purposes of this
paragraph, the applicable amount is--
``(i) in the case of any individual who is
a qualified veteran by reason of subsection
(d)(3)(A)(ii)(I), 200 percent of the dollar
amount in effect under subsection (a)(1),
``(ii) in the case of any individual who is
a qualified veteran by reason of subsection
(d)(3)(A)(iv), 250 percent of the dollar amount
in effect under subsection (a)(1), and
``(iii) in the case of any individual who
is a qualified veteran by reason of subsection
(d)(3)(A)(ii)(II), 400 percent of the dollar
amount in effect under subsection (a)(1).''.
(B) Long-term family assistance recipients.--
(i) In general.--Section 51(e)(1) of such
Code is amended by striking ``family assistance
recipient--'' and all that follows and
inserting the following: ``family assistance
recipient, in lieu of subsection (a), the
amount of the work opportunity credit
determined under this section for the taxable
year shall be equal to--
``(1) 40 percent of so much of the qualified first-year
wages with respect to such individual for such year as does not
exceed $10,000, and
``(2) 50 percent of so much of the qualified second-year
wages with respect to such individual for such year as does not
exceed $10,000.''.
(ii) Clerical amendment.--The heading for
section 51(e) of such Code is amended by
striking ``Credit for Second-year Wages'' and
inserting ``Special Rules for Determining
Credit''.
(C) Summer youth employees.--Section 51(d)(7)(B) of
such Code is amended--
(i) by striking clause (ii),
(ii) by striking ``, and'' at the end of
clause (i) and inserting a period,
(iii) by redesignating clause (i) (as so
amended) as clause (v), and
(iv) by inserting before such clause (v)
(as so redesignated) the following new clauses:
``(i) in lieu of the amount determined
under subsection (a), the amount of the work
opportunity credit determined under this
section for the taxable year shall be equal to
40 percent of the qualified first-year wages
for such year,
``(ii) in the case of an individual
described in subsection (i)(3)(A), clause (i)
shall be applied by substituting `25 percent'
for `40 percent',
``(iii) in the case of an individual
described in subsection (i)(3)(B), no wages
shall be taken into account under clause (i),
``(iv) the amount of qualified first-year
wages which may be taken into account with
respect to such individual shall not exceed 50
percent of the dollar amount in effect under
subsection (a)(1), and''.
(D) Agricultural and railway labor.--
(i) In general.--Section 51(h)(1) of such
Code is amended--
(I) in subparagraph (A), by
striking ``$6,000'' and inserting ``the
dollar amount in effect under
subsection (a)(1)'', and
(II) in subparagraph (B), by
striking ``$500 per month'' and
inserting ``one-twelfth of the dollar
amount in effect under subsection
(a)(1) per month''.
(ii) Related conforming amendments.--
Section 51(e)(3) of such Code is amended by
striking subparagraphs (A) and (B) and
inserting the following:
``(A) such subparagraph (A) shall be applied by
substituting `the dollar amount in effect under
subsection (e)(1)' for `the dollar amount in effect
under subsection (a)(1)', and
``(B) such subparagraph (B) shall be applied by
substituting `one-twelfth of the dollar amount in
effect under subsection(e)(1)' for `one-twelfth of the
dollar amount in effect under subsection (a)(1)'.''.
(E) Individuals not meeting minimum employment
periods.--
(i) Subparagraphs (A) and (B) of section
51(i)(3) of such Code are each amended by
striking ``subsection (a)'' and inserting
``subsection (a)(1)''.
(ii) Section 51(i)(3)(A) of such Code is
amended by striking ``40 percent'' and
inserting ``50 percent''.
(c) Removal of Age Limit for Qualified Supplemental Nutrition
Assistance Program Benefits Recipient.--Section 51(d)(8)(A)(i) of such
Code is amended by striking ``but not age 40''.
(d) Effective Date.--The amendments made by this section shall
apply to individuals who begin work for the employer after December 31,
2025.
SEC. 3. ELIGIBILITY OF SPOUSES OF MILITARY PERSONNEL FOR THE WORK
OPPORTUNITY CREDIT.
(a) In General.--Paragraph (1) of section 51(d) of the Internal
Revenue Code of 1986 is amended by striking ``or'' at the end of
subparagraph (I), by striking the period at the end of subparagraph (J)
and inserting ``, or'', and by adding at the end the following new
subparagraph:
``(K) a qualified military spouse.''.
(b) Qualified Military Spouse.--Subsection (d) of section 51 of
such Code is amended by adding at the end the following new paragraph:
``(16) Qualified military spouse.--The term `qualified
military spouse' means any individual who is certified by the
designated local agency as being (as of the hiring date) a
spouse of a member of the Armed Forces of the United States.''.
(c) Effective Date.--The amendments made by this section shall
apply to amounts paid or incurred after the date of the enactment of
this Act to individuals who begin work for the employer after such
date.
SEC. 4. PROMOTION OF TARGETED GROUP MEMBER HIRING TO CERTAIN
INDUSTRIES.
The Secretary of the Treasury, the Secretary of Commerce, the
Secretary of Labor, and the Administrator of the Small Business
Administration (or their respective delegates), in consultation with
each other and consistent with applicable law, shall promote the hiring
of members of a targeted group (as defined in section 51(d) of the
Internal Revenue Code of 1986) to business leaders across critical
industry sectors, including manufacturing, infrastructure, energy,
health care, and construction.
<all>
Introduced in Senate
Read twice and referred to the Committee on Finance.
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