[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2575 Introduced in House (IH)]
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118th CONGRESS
1st Session
H. R. 2575
To amend the Internal Revenue Code of 1986 to provide a partially
refundable credit against payroll taxes for certain restaurants
affected by the COVID-19 pandemic.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 13, 2023
Mr. Blumenauer (for himself and Mr. Phillips) introduced the following
bill; which was referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide a partially
refundable credit against payroll taxes for certain restaurants
affected by the COVID-19 pandemic.
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 ``Restaurant Revitalization Tax Credit
Act''.
SEC. 2. RESTAURANT REVITALIZATION CREDIT.
(a) In General.--Subchapter D of chapter 21 of subtitle C of the
Internal Revenue Code of 1986 is amended by adding at the end the
following new section:
``SEC. 3135. RESTAURANT REVITALIZATION CREDIT.
``(a) In General.--In the case of an eligible employer, there shall
be allowed as a credit against applicable employment taxes for each
calendar quarter an amount equal to 100 percent of the wages with
respect to each employee of such employer for such calendar quarter.
``(b) Limitations and Refundability.--
``(1) In general.--The aggregate amount of wages which may
be taken into account under subsection (a) by the eligible
employer for any calendar quarter 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) on the wages paid with respect to the employment of all
the employees of the eligible employer for such calendar
quarter. For purposes of the preceding sentence, the credit
allowed under subsection (a) shall be applied first against
applicable employment taxes described in subsection (c)(1)(A).
``(3) Partial refundability of excess credit.--
``(A) In general.--If the amount of the credit
under subsection (a) exceeds the limitation of
paragraph (2), so much of such excess as does not
exceed the applicable employer refund limitation shall
be treated as an overpayment that shall be refunded
under sections 6402(a) and 6413(b).
``(B) Applicable employer refund limitation.--For
purposes of subparagraph (A), the applicable employer
refund limitation is the excess of--
``(i) $25,000, over
``(ii) the amount of credit treated as an
overpayment of the eligible employer by reason
of this paragraph for all preceding calendar
quarters.
``(C) Reduction based on number of employees.--In
the case of any eligible employer for which the average
number of full-time employees (within the meaning of
section 4980H) employed by such eligible employer
during the last calendar quarter of 2022 (rounded to
the nearest multiple of 1) exceeds 10, the $25,000
dollar amount under subparagraph (A)(ii)(I) shall be
reduced (but not below zero) by the product of such
excess and $2,500.
``(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).
``(B) The taxes imposed under section 3111(b).
``(2) Eligible employer.--
``(A) In general.--The term `eligible employer'
means any employer--
``(i) which is an eligible entity (as
defined in section 5003(a) of the American
Rescue Plan Act of 2021) which--
``(I) was established before March
14, 2020,
``(II) submitted an application for
a grant under section 5003(c) of such
Act in accordance with the procedures
established by the Administrator of the
Small Business Administration under
such section,
``(III) certifies to the Secretary
(in such form and manner as the
Secretary requires) that such employer
was eligible for a grant under such
section, and
``(IV) did not receive any grant
funds under such section due to a lack
of funding,
``(ii) which paid applicable employment
taxes with respect to pay periods occurring in
at least 2 calendar quarters of calendar year
2021, and
``(iii) which meets the gross receipts test
of subparagraph (B).
``(B) Gross receipts test.--An employer meets the
gross receipts test of this subparagraph if--
``(i) the gross receipts of such employer
for any applicable calendar year were less than
50 percent the gross receipts of such employer
for calendar year 2019, or
``(ii) the average gross receipts of such
employer for all applicable calendar years were
less than 70 percent the gross receipts of such
employer for the calendar year 2019.
``(C) Applicable calendar year.--For purposes of
this paragraph, the term `applicable calendar year'
means any of the following:
``(i) Calendar year 2020.
``(ii) Calendar year 2021.
``(D) Special rule for employers not in existence
for entirety of 2019.--In the case of any employer that
was in existence before January 1, 2020, but not in
existence on January 1, 2019, the amount of gross
receipts taken into account for any applicable calendar
year shall be the amount of such gross receipts
(determined without regard to this clause) multiplied
by the ratio of--
``(i) the number of days during 2019 during
which such employer was in existence, to
``(ii) 365.
``(E) Special rule for employers not in existence
before 2020.--In the case of any employer that was not
in existence before January 1, 2020, in applying this
paragraph--
``(i) the amount of gross receipts for
calendar year 2019 shall be equal to the
product of--
``(I) the amount of gross receipts
for the period beginning on the date
the employer was established and ending
before March 14, 2020, and
``(II) the ratio of 366 to the
number of days in the period described
in subclause (I), and
``(ii) the amount of gross receipts for
calendar year 2020 shall be equal to the
product of--
``(I) the amount of gross receipts
for the period beginning after March
13, 2020, and ending on December 31,
2020, and
``(II) the ratio of 366 to the
number of days in the period described
in subclause (I).
``(3) Wages.--
``(A) In general.--The term `wages' has the meaning
given such term under section 3121(a), determined
without regard to paragraph (1) thereof.
``(B) Exception.--Such term shall not include any
wages taken into account under sections 41, 45A, 45P,
45S, 51, and 1396.
``(4) Other terms.--Any term used in this section which is
also used in this chapter shall have the same meaning as when
used in this chapter.
``(d) Aggregation Rule.--All persons treated as a single employer
under subsection (a) or (b) of section 52, or subsection (m) or (o) of
section 414, shall be treated as one employer for purposes of this
section.
``(e) Election To Not Take Certain Wages Into Account.--This
section shall not apply to so much of the wages paid by an eligible
employer as such employer elects (at such time and in such manner as
the Secretary may prescribe) to not take into account for purposes of
this section.
``(f) Third Party Payors.--Any credit allowed under this section
shall be treated as a credit described in section 3511(d)(2).
``(g) Treatment of Deposits.--The Secretary shall waive any penalty
under section 6656 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.
``(h) Extension of Limitation on Assessment.--Notwithstanding
section 6501, the limitation on the time period for the assessment of
any amount attributable to a credit claimed under this section shall
not expire before the date that is 5 years after the later of--
``(1) the date on which the original return which includes
the calendar quarter with respect to which such credit is
determined is filed, or
``(2) the date on which such return is treated as filed
under section 6501(b)(2).
``(i) Regulations and Guidance.--The Secretary shall issue such
forms, instructions, regulations, and other guidance as are necessary--
``(1) 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), including
regulations or guidance allowing such payors to submit
documentation necessary to substantiate the eligible employer
status of employers that use such payors, and
``(2) to prevent the avoidance of the purposes of the
limitations under this section, including through the leaseback
of employees.
Any forms, instructions, regulations, or other guidance described in
paragraph (1) shall require the customer to be responsible for the
accounting of the credit and for any liability for improperly claimed
credits and shall require the certified professional employer
organization or other third party payor to accurately report such tax
credits based on the information provided by the customer.
``(j) Application.--This section shall only apply to wages paid
after December 31, 2022, and before January 1, 2024.''.
(b) Refunds.--Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting ``3135,'' after ``3134''.
(c) Clerical Amendment.--The table of sections for subchapter D of
chapter 21 of subtitle C of the Internal Revenue Code of 1986 is
amended by adding at the end the following:
``Sec. 3135. Restaurant revitalization credit.''.
(d) Coordination With Small Business Administration.--The
Administrator of the Small Business Administration shall coordinate
with and provide information to the Secretary of the Treasury (or the
Secretary's delegate) to assist in identifying employers that are
eligible for the credit allowed by section 3135 of the Internal Revenue
Code of 1986, as added by this section.
(e) Effective Date.--The amendments made by this section shall
apply to calendar quarters beginning after December 31, 2022.
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