S 3660 ISCommentsClose CommentsPermalink

112th CONGRESSCommentsClose CommentsPermalink

2d SessionCommentsClose CommentsPermalink

S. 3660CommentsClose CommentsPermalink

To extend the payroll tax holiday and to amend the Internal Revenue Code of 1986 to provide a temporary payroll increase tax credit for certain employers.CommentsClose CommentsPermalink

IN THE SENATE OF THE UNITED STATESCommentsClose CommentsPermalink

December 5, 2012CommentsClose CommentsPermalink

Mr. CASEY introduced the following bill; which was read twice and referred to the Committee on FinanceCommentsClose CommentsPermalink

A BILLCommentsClose CommentsPermalink

To extend the payroll tax holiday and to amend the Internal Revenue Code of 1986 to provide a temporary payroll increase tax credit for certain employers.CommentsClose CommentsPermalink

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

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘Middle Class & Small Business Tax Cut Act of 2012’.CommentsClose CommentsPermalink

SEC. 2. EXTENSION OF PAYROLL TAX REDUCTION.

(a) In General- Subsection (c) of section 601 of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 is amended by striking ‘and 2012’ and inserting ‘, 2012, and 2013’.CommentsClose CommentsPermalink





(b) Effective Date- The amendments made by this section shall apply to remuneration received, and taxable years beginning, after December 31, 2012.CommentsClose CommentsPermalink

SEC. 3. EMPLOYER PAYROLL INCREASE CREDIT.

(a) In General- Subchapter B of chapter 65 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:CommentsClose CommentsPermalink

‘SEC. 6433. EMPLOYER PAYROLL INCREASE CREDITS.

‘(a) In General- Each qualified employer shall be treated as having made a payment against the tax imposed by section 3111(a) or section 3221(a), whichever is applicable, for each qualified quarter in an amount equal to the credit amount.CommentsClose CommentsPermalink





‘(b) Credit Amount- For purposes of this section, the credit amount with respect to any qualified quarter is equal to the 10 percent of the qualified payroll increase of such employer for such qualified quarter.CommentsClose CommentsPermalink





‘(c) Dollar Limitation- The total credit amount with respect to any employer shall not exceed $500,000 for all qualified quarters.CommentsClose CommentsPermalink





‘(d) Qualified Employer- For purposes of this section, the term ‘qualified employer’ means any American employer other than the United States, any State, or any instrumentality thereof.CommentsClose CommentsPermalink





‘(e) Qualified Payroll Increase- For purposes of this section--CommentsClose CommentsPermalink





‘(1) IN GENERAL- The term ‘qualified payroll increase’ with respect to any qualified quarter means the amount, if any, by which a qualified employer’s qualified payroll for such quarter exceeds the qualified payroll for such quarter of the calendar year preceding the year in which such qualified quarter falls.CommentsClose CommentsPermalink





‘(2) QUALIFIED PAYROLL- The term ‘qualified payroll’ means the amount of all wages (within the meaning of section 3121(a)) paid or incurred by a qualified employer to the employees of such employer, except that, with respect to each such employee for any quarter of the employer, such wages shall be taken into account only to the extent that such wages do not exceed the contribution and benefit base as determined under section 230 of the Social Security Act.CommentsClose CommentsPermalink





‘(3) RAILWAY LABOR- In the case of remuneration subject to the tax imposed by section 3221(a), paragraph (1) shall be applied by substituting ‘all compensation (within the meaning of section 3231(e))’ for ‘all wages (within the meaning of section 3121(a))’.CommentsClose CommentsPermalink





‘(4) SPECIAL RULE FOR LARGE EMPLOYERS- In the case of an employer that employs 100 or more employees during the qualified quarter, no qualified payroll increase shall be taken into account for such qualified quarter unless the qualified payroll increase with respect to such qualified quarter exceeds 3 percent of the qualified payroll for such quarter of the calendar year preceding the year in which such qualified quarter falls.CommentsClose CommentsPermalink





‘(f) Qualified Quarter- For purposes of this section, the term ‘qualified quarter’ means--CommentsClose CommentsPermalink





‘(1) the calendar quarter which includes the date of the enactment of the Middle Class & Small Business Tax Cut Act of 2012, andCommentsClose CommentsPermalink





‘(2) each of the 3 calendar quarters following such quarter.CommentsClose CommentsPermalink





‘(g) Definitions- Except as provided in subsection (h)(1), any term used in this section which is also used in section 3111 has the same meaning as when used in such section.CommentsClose CommentsPermalink





‘(h) Special Rules- For purposes of this section--CommentsClose CommentsPermalink





‘(1) EMPLOYEE- The term ‘employee’ includes only individuals who are citizens or lawful residents of the United States who receive wages, remuneration, compensation, or tips from an employer for work performed within a State or a possession of the United States.CommentsClose CommentsPermalink





‘(2) MAINTENANCE OF BASE EMPLOYMENT REQUIREMENT- This section shall not apply to any qualified employer for any qualified quarter if the total number of employees of such employer during such quarter is less than the total number of such employees during the quarter preceding such quarter, determined by not taking into account any employee who is a seasonal employee during such preceding quarter.CommentsClose CommentsPermalink





‘(3) CONTROLLED GROUPS- All employers treated as a single employer under section (a) or (b) of section 52 shall be treated as a single employer for purposes of the dollar limitation under subsection (c), except that any employer which is not an American employer shall not be taken into account.CommentsClose CommentsPermalink





‘(4) NEW EMPLOYERS-CommentsClose CommentsPermalink





‘(A) IN GENERAL- In the case of a qualified employer which comes into existence after the date of the enactment of the Middle Class & Small Business Tax Cut Act of 2012 and before January 1, 2014--CommentsClose CommentsPermalink





‘(i) the term ‘qualified quarter’ means--CommentsClose CommentsPermalink





‘(I) the first calendar quarter for which such qualified employer is in existence, andCommentsClose CommentsPermalink





‘(II) each of the 3 quarters following such quarter,CommentsClose CommentsPermalink





‘(ii) the qualified payroll increase of such employer for the quarter described in clause (i)(I) shall be equal to the amount of the employer’s qualified payroll for such quarter, andCommentsClose CommentsPermalink





‘(iii) the qualified payroll increase of such employer for any quarter described in clause (i)(II) shall be the amount, if any, by which the employer’s qualified payroll for such quarter exceeds the qualified payroll of the quarter preceding such quarter.CommentsClose CommentsPermalink





‘(B) TRANSITION RULE-CommentsClose CommentsPermalink





‘(i) IN GENERAL- In the case of a qualified employer which comes into existence--CommentsClose CommentsPermalink





‘(I) after the last day of the calendar quarter which is 5 calendar quarters before the date of the enactment of the Middle Class & Small Business Tax Cut Act of 2012, andCommentsClose CommentsPermalink





‘(II) before such date of enactment,CommentsClose CommentsPermalink





the qualified payroll increase of such employer for any transition quarter shall be the amount, if any, by which the employer’s qualified payroll for such quarter exceeds the qualified payroll of the quarter preceding such quarter.CommentsClose CommentsPermalink





‘(ii) TRANSITION QUARTER- For purposes of clause (i), the term ‘transition quarter’ means a qualified quarter with respect to which the qualified payroll increase cannot be determined under subsection (e)(1) solely because the employer was not in existence during such quarter of the calendar year preceding the year in which such qualified quarter falls.’.CommentsClose CommentsPermalink





(b) Clerical Amendment- The table of sections for subchapter B of chapter 65 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:CommentsClose CommentsPermalink





‘Sec. 6433. Employer payroll increase credits.’.CommentsClose CommentsPermalink





(c) Notification- Not later than 30 days after the date of the enactment of this Act, the Commissioner of Internal Revenue shall notify all employers required to withhold employment taxes under chapter 21 or 22 of the Internal Revenue Code of 1986 of the enactment and applicability of section 6433 of the Internal Revenue Code of 1986, as added by this Act.CommentsClose CommentsPermalink





(d) Investigation and Report on Enforcement Actions- Not later than 6 months after the date of the enactment of this Act, and quarterly thereafter, the Commissioner of Internal Revenue shall submit a report to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives on the enforcement measures taken to prevent and penalize fraud related to section 6433 of the Internal Revenue Code of 1986, including such information as--CommentsClose CommentsPermalink





(1) general statistics related to the application of such section,CommentsClose CommentsPermalink





(2) cases of fraud, andCommentsClose CommentsPermalink





(3) the status of investigatory and prosecutorial actions related to such cases.CommentsClose CommentsPermalink





(e) Effective Date- The amendments made by subsections (a) and (b) shall apply to calendar quarters beginning with the calendar quarter which includes the date of the enactment of this Act.CommentsClose CommentsPermalink