A bill to provide a Federal income tax credit for Patriot employers, and for other purposes.

Summary: Amends the Internal Revenue Code to allow a taxpayer certified as a Patriot employer by the Secretary of the Treasury a tax credit for one percent of such employer's taxable income. Defines a "Patriot employer" as any taxpayer who: (1) maintains its headquarters in the United States; (2) pays at least 60% of the health care premiums of its employees; (3) maintains or increases the number of its full-time workers in the United States relative to its full-time workers outside of the United States: (4) provides its employees with a certain level of compensation and retirement benefits; and (5) provides full differential salary and insurance benefits for all National Guard and Reserve employees called to active duty.

SECTION 1. REDUCED TAXES FOR PATRIOT EMPLOYERS.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new section:

``SEC. 45N. REDUCTION IN TAX OF PATRIOT EMPLOYERS.

    ``(a) In General.--In the case of any taxable year with respect to 
which a taxpayer is certified by the Secretary as a Patriot employer, 
the Patriot employer credit determined under this section for purposes 
of section 38 shall be equal to 1 percent of the taxable income of the 
taxpayer which is properly allocable to all trades or businesses with 
respect to which the taxpayer is certified as a Patriot employer for 
the taxable year.
    ``(b) Patriot Employer.--For purposes of subsection (a), the term 
`Patriot employer' means, with respect to any taxable year, any 
taxpayer which--
            ``(1) maintains its headquarters in the United States if 
        the taxpayer has ever been headquartered in the United States,
            ``(2) pays at least 60 percent of each employee's health 
        care premiums,
            ``(3) if such taxpayer employs at least 50 employees on 
        average during the taxable year--
                    ``(A) maintains or increases the number of full-
                time workers in the United States relative to the 
                number of full-time workers outside of the United 
                States,
                    ``(B) compensates each employee of the taxpayer at 
                an hourly rate (or equivalent thereof) not less than an 
                amount equal to the Federal poverty level for a family 
                of three for the calendar year in which the taxable 
                year begins divided by 2,080,
                    ``(C) provides either--
                            ``(i) a defined contribution plan which for 
                        any plan year--
                                    ``(I) requires the employer to make 
                                nonelective contributions of at least 5 
                                percent of compensation for each 
                                employee who is not a highly 
                                compensated employee, or
                                    ``(II) requires the employer to 
                                make matching contributions of 100 
                                percent of the elective contributions 
                                of each employee who is not a highly 
                                compensated employee to the extent such 
                                contributions do not exceed the 
                                percentage specified by the plan (not 
                                less than 5 percent) of the employee's 
                                compensation, or
                            ``(ii) a defined benefit plan which for any 
                        plan year requires the employer to make 
                        contributions on behalf of each employee who is 
                        not a highly compensated employee in an amount 
                        which will provide an accrued benefit under the 
                        plan for the plan year which is not less than 5 
                        percent of the employee's compensation, and
                    ``(D) provides full differential salary and 
                insurance benefits for all National Guard and Reserve 
                employees who are called for active duty, and
            ``(4) if such taxpayer employs less than 50 employees on 
        average during the taxable year, either--
                    ``(A) compensates each employee of the taxpayer at 
                an hourly rate (or equivalent thereof) not less than an 
                amount equal to the Federal poverty level for a family 
                of 3 for the calendar year in which the taxable year 
                begins divided by 2,080, or
                    ``(B) provides either--
                            ``(i) a defined contribution plan which for 
                        any plan year--
                                    ``(I) requires the employer to make 
                                nonelective contributions of at least 5 
                                percent of compensation for each 
                                employee who is not a highly 
                                compensated employee, or
                                    ``(II) requires the employer to 
                                make matching contributions of 100 
                                percent of the elective contributions 
                                of each employee who is not a highly 
                                compensated employee to the extent such 
                                contributions do not exceed the 
                                percentage specified by the plan (not 
                                less than 5 percent) of the employee's 
                                compensation, or
                            ``(ii) a defined benefit plan which for any 
                        plan year requires the employer to make 
                        contributions on behalf of each employee who is 
                        not a highly compensated employee in an amount 
                        which will provide an accrued benefit under the 
                        plan for the plan year which is not less than 5 
                        percent of the employee's compensation.''.
    (b) Allowance as General Business Credit.--Section 38(b) of the 
Internal Revenue Code or 1986 is amended by striking ``and'' at the end 
of paragraph (25), by striking the period at the end of paragraph (26) 
and inserting ``, and'', and by adding at the end the following:
            ``(27) the Patriot employer credit determined under section 
        45N.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2006.