II 

117TH CONGRESS 

1ST SESSION S. 536 

To amend the Internal Revenue Code of 1986 to provide a credit for wages 

received by individuals that are less than the median wage. 

IN THE SENATE OF THE UNITED STATES 

MARCH 2 (legislative day, MARCH 1), 2021 

Mr. HAWLEY 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 provide 

a credit for wages received by individuals that are less 

than the median wage. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Blue Collar Bonus Act 

5 of 2021’’. 

6 SEC. 2. BLUE COLLAR BONUS TAX CREDIT. 

7 (a) IN GENERAL.— 

8 (1) ALLOWANCE OF CREDIT.—Subpart C of 

9 part IV of subchapter A of chapter 1 of the Internal 


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1 Revenue Code of 1986 is amended by inserting after 

2 section 36B the following: 

3 ‘‘SEC. 36C. CREDIT FOR WAGES PAID AT A RATE LESS THAN 

4 THE MEDIAN WAGE. 

5 ‘‘(a) CREDIT ALLOWED.— 

6 ‘‘(1) IN GENERAL.—In the case of an indi7 vidual, there shall be allowed as a credit against the 

8 tax imposed by this subtitle for any taxable year an 

9 amount equal to the sum of the amounts determined 

10 under paragraph (2) for each individual included on 

11 the taxpayer’s return of tax for the taxable year. 

12 ‘‘(2) AMOUNT PER INDIVIDUAL.—The amount 

13 determined under this paragraph with respect to any 

14 individual shall be the product of— 

15 ‘‘(A) the blue collar bonus amount of such 

16 individual for the taxable year, and 

17 ‘‘(B) the number of hours for which the in18 dividual performed services for which wages 

19 were paid during such taxable year. 

20 ‘‘(b) BLUE COLLAR BONUS AMOUNT.—For purposes 

21 of this section— 

22 ‘‘(1) IN GENERAL.—The term ‘blue collar bonus 

23 amount’ means, with respect to any individual for 

24 any taxable year, 50 percent of the excess (if any) 

25 of— 


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1 ‘‘(A) the median wage rate for such tax2 able year, over 

3 ‘‘(B) the average hourly wages received by 

4 the individual during the taxable year. 

5 ‘‘(2) NON-HOURLY WAGE RATE.—For purposes 

6 of paragraph (1)(A), in the case of any individual 

7 who is not paid on an hourly wage rate, the wages 

8 of such employee shall be prorated to an hourly 

9 wage rate under regulations established by the Sec10 retary. 

11 ‘‘(3) MEDIAN WAGE RATE.— 

12 ‘‘(A) IN GENERAL.—The median wage rate 

13 is $16.50 per hour. 

14 ‘‘(B) ADJUSTMENT.— 

15 ‘‘(i) IN GENERAL.—In the case of any 

16 taxable year beginning in a calendar year 

17 after 2021, the $16.50 amount under sub18 paragraph (A) shall each be increased by 

19 an amount equal to— 

20 ‘‘(I) such dollar amount, multi21 plied by 

22 ‘‘(II) the cost-of-living adjust23 ment determined under section 1(f)(3) 

24 for the calendar year in which the tax25 able year begins, determined by subVerDate Sep 11 2014 03:32 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S536.IS S536

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1 stituting in subparagraph (A)(ii) 

2 thereof ‘calendar year 2020’ for ‘cal3 endar year 2016’. 

4 ‘‘(ii) ROUNDING.—If any amount as 

5 adjusted under paragraph (1) is not a mul6 tiple of $0.10, such dollar amount shall be 

7 rounded to the next lowest multiple of 

8 $0.10. 

9 ‘‘(c) NUMBER OF HOURS TAKEN INTO ACCOUNT.— 

10 For purposes of subsection (a)(2)(B) and for purposes of 

11 determining the average hourly wages of an individual 

12 under subsection (b)(1)(B), the number of hours taken 

13 into account shall not exceed— 

14 ‘‘(1) for any week, 40, and 

15 ‘‘(2) for any taxable year, 2080. 

16 ‘‘(d) OTHER DEFINITIONS AND SPECIAL RULES.— 

17 ‘‘(1) WAGES.—The term ‘wages’ has the mean18 ing given such term by subsection (b) of section 

19 3306 (determined without regard to any dollar limi20 tation contained in such section). 

21 ‘‘(2) TREATMENT OF DEPENDENTS.—If a de22 duction under section 151 with respect to an indi23 vidual is allowed to another taxpayer for a taxable 

24 year beginning in the calendar year in which such 

25 individual’s taxable year begins, no credit shall be alVerDate Sep 11 2014 03:32 Apr 01, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S536.IS S536

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1 lowed under subsection (a) to such individual for 

2 such individual’s taxable year. 

3 ‘‘(3) NONRESIDENT ALIENS.—This section shall 

4 not apply to any taxpayer that is a nonresident alien 

5 for the taxable year. 

6 ‘‘(e) IDENTIFICATION REQUIREMENT.—No credit 

7 shall be allowed under this section to a taxpayer with re8 spect to any individual unless the taxpayer includes the 

9 social security number of such individual on the return 

10 of tax for the taxable year. For purposes of the preceding 

11 sentence, the term ‘social security number’ means a social 

12 security number issued to an individual by the Social Se13 curity Administration, but only if the social security num14 ber is issued— 

15 ‘‘(1) to a citizen of the United States or pursu16 ant to subclause (I) (or that portion of subclause 

17 (III) that relates to subclause (I)) of section 

18 205(c)(2)(B)(i) of the Social Security Act, and 

19 ‘‘(2) before the due date for such return. 

20 ‘‘(f) RESTRICTIONS ON TAXPAYERS WHO IMPROP21 ERLY CLAIMED CREDIT IN PRIOR YEAR.— 

22 ‘‘(1) TAXPAYERS MAKING PRIOR FRAUDULENT

23 OR RECKLESS CLAIMS.— 


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1 ‘‘(A) IN GENERAL.—No credit shall be al2 lowed under this section for any taxable year in 

3 the disallowance period. 

4 ‘‘(B) DISALLOWANCE PERIOD.—For pur5 poses of subparagraph (A), the disallowance pe6 riod is the period of 2 taxable years after the 

7 most recent taxable year for which there was a 

8 final determination that the taxpayer’s claim of 

9 credit under this section was due to fraud or to 

10 reckless or intentional disregard of rules and 

11 regulations. 

12 ‘‘(g) RECONCILIATION OF CREDIT AND ADVANCE

13 CREDIT.— 

14 ‘‘(1) IN GENERAL.—The amount of the credit 

15 allowed under this section to any taxpayer for any 

16 taxable year shall be reduced (but not below zero) by 

17 the aggregate amount of payments made under sec18 tion 7527A to such taxpayer during such taxable 

19 year. Any failure to so reduce the credit shall be 

20 treated as arising out of a mathematical or clerical 

21 error and assessed according to section 6213(b)(1). 

22 ‘‘(2) EXCESS ADVANCE PAYMENTS.— 

23 ‘‘(A) IN GENERAL.—If the aggregate 

24 amount of payments under section 7527A to 

25 the taxpayer during the taxable year exceeds 


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1 the amount of the credit allowed under this sec2 tion to such taxpayer for such taxable year (de3 termined without regard to paragraph (1)), the 

4 tax imposed by this chapter for such taxable 

5 year shall be increased by the amount of such 

6 excess. Any failure to so increase the tax shall 

7 be treated as arising out of a mathematical or 

8 clerical error and assessed according to section 

9 6213(b)(1). 

10 ‘‘(B) SAFE HARBOR BASED ON MODIFIED

11 ADJUSTED GROSS INCOME.— 

12 ‘‘(i) IN GENERAL.—Subparagraph (A) 

13 shall not apply to any taxpayer whose ad14 justed gross income for the taxable year 

15 does not exceed $50,000 ($100,000, in the 

16 case of a joint return). 

17 ‘‘(ii) LIMITATION ON INCREASE.—In 

18 the case of a taxpayer whose adjusted 

19 gross income exceeds $50,000 ($100,000, 

20 in the case of a joint return), the amount 

21 of the increase under subparagraph (A) 

22 shall not exceed the excess of— 

23 ‘‘(I) the adjusted gross income of 

24 the taxpayer for the taxable year, over 


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1 ‘‘(II) $50,000 ($100,000, in the 

2 case of a joint return). 

3 ‘‘(h) REGULATIONS.—The Secretary may prescribe 

4 such rules or other guidance as may be necessary to carry 

5 out the purposes of this section and section 7527A, includ6 ing— 

7 ‘‘(1) rules or guidance related to the treatment 

8 of tipped workers, 

9 ‘‘(2) rules or guidance related to minimizing 

10 compliance and record-keeping burdens, 

11 ‘‘(3) rules or guidance related to individuals 

12 who receive wages from multiple employers, and 

13 ‘‘(4) in consultation with the Secretary of 

14 Labor, rules or guidance related to the prevention of 

15 reduced wages or hours worked on account of the 

16 benefit provided under this section. 

17 ‘‘(i) TERMINATION.—This section shall not apply to 

18 any taxable year beginning after December 31, 2023.’’. 

19 (2) CONFORMING AMENDMENTS.— 

20 (A) Paragraph (2) of section 1324(b) of 

21 title 31, United States Code, is amended by in22 serting ‘‘36C,’’ after ‘‘36B,’’. 

23 (B) The table of sections for subpart C of 

24 part IV of subchapter A of chapter 1 of such 


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1 Code is amended by inserting after the item re2 lated to section 36B the following new item: 

‘‘Sec. 36C. Credit for wages paid at a rate less than the median wage.’’. 

3 (b) ADVANCE PAYMENT OF CREDIT.— 

4 (1) IN GENERAL.—Chapter 77 of such Code is 

5 amended by inserting after section 7527 the fol6 lowing new section: 

7 ‘‘SEC. 7527A. ADVANCE PAYMENT OF WAGE TAX CREDIT. 

8 ‘‘(a) IN GENERAL.—As soon as practical but not 

9 later than 90 days after the date of the enactment of this 

10 section, the Secretary shall establish a program for mak11 ing periodic payments to taxpayers in an amount equal 

12 to the amount of the credit the taxpayer would receive 

13 under section 36C if the last day of the taxable year were 

14 the last day of the applicable period for which the payment 

15 is made. 

16 ‘‘(b) LENGTH OF PERIOD.—Payments under the pro17 gram established under subsection (a) shall be made not 

18 less than quarterly. 

19 ‘‘(c) ADJUSTMENTS.—The Secretary may adjust the 

20 amount of any payment to properly take into account the 

21 amount by which any payment made before such date was 

22 greater than or less than the amount that such payment 

23 would have been on the basis of data for any subsequent 

24 period. 


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1 ‘‘(d) INFORMATION REPORTING.—The Secretary 

2 shall require the submission of additional information con3 cerning the wages paid by employers for purposes of pro4 viding advance payments under this section. Such infor5 mation may be provided as part of existing reporting re6 quirements. 

7 ‘‘(e) ON-LINE INFORMATION PORTAL.—The Sec8 retary shall establish an on-line portal which allows tax9 payers to— 

10 ‘‘(1) elect not to receive payments under this 

11 section, and 

12 ‘‘(2) provide such information as the Secretary 

13 may require to facilitate an advance payment of the 

14 credit to the eligible individual. 

15 ‘‘(f) NOTICE OF PAYMENTS.—Not later than January 

16 31 of the calendar year following any calendar year during 

17 which the Secretary makes one or more payments to any 

18 taxpayer under this section, the Secretary shall provide 

19 such taxpayer with a written notice which includes the tax20 payer’s taxpayer identity (as defined in section 

21 6103(b)(6)), the aggregate amount of such payments 

22 made to such taxpayer during such calendar year, and 

23 such other information as the Secretary determines appro24 priate. 

25 ‘‘(g) ADMINISTRATIVE PROVISIONS.— 


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1 ‘‘(1) APPLICATION OF DIRECT DEPOSIT RE2 QUIREMENT.—Solely for purposes of section 3332 of 

3 title 31, United States Code (and notwithstanding 

4 the last sentence of subsection (j)(3) thereof), the 

5 payments made by the Secretary under subsection 

6 (a) shall be treated as Federal payments. 

7 ‘‘(2) DELIVERY OF PAYMENTS.—Notwith8 standing any other provision of law, the Secretary 

9 may certify and disburse refunds payable under this 

10 section electronically to— 

11 ‘‘(A) any account to which the payee re12 ceived or authorized, on or after January 1, 

13 2019, a refund of taxes under this title or a 

14 Federal payment (as defined in section 3332 of 

15 title 31, United States Code), 

16 ‘‘(B) any account belonging to a payee 

17 from which that individual, on or after January 

18 1, 2019, made a payment of taxes under this 

19 title, or 

20 ‘‘(C) any Treasury-sponsored account (as 

21 defined in section 208.2 of title 31, Code of 

22 Federal Regulations). 

23 ‘‘(3) WAIVER OF CERTAIN RULES.—Notwith24 standing section 3325 of title 31, United States 

25 Code, or any other provision of law, with respect to 


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1 any payment of a refund under this section, a dis2 bursing official in the executive branch of the United 

3 States Government may modify payment information 

4 received from an officer or employee described in 

5 section 3325(a)(1)(B) of such title for the purpose 

6 of facilitating the accurate and efficient delivery of 

7 such payment. Except in cases of fraud or reckless 

8 neglect, no liability under section 3325, 3527, 3528, 

9 or 3529 of title 31, United States Code, shall be im10 posed with respect to payments made under this 

11 paragraph. 

12 ‘‘(4) EXCEPTION FROM REDUCTION OR OFF13 SET.—Any payment made to any individual under 

14 this section shall not be— 

15 ‘‘(A) subject to reduction or offset pursu16 ant to section 3716 or 3720A of title 31, 

17 United States Code, 

18 ‘‘(B) subject to reduction or offset pursu19 ant to subsection (d), (e), or (f) of section 

20 6402, or 

21 ‘‘(C) reduced or offset by other assessed 

22 Federal taxes that would otherwise be subject 

23 to levy or collection.’’. 

24 (2) CONFORMING AMENDMENTS.— 


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1 (A) Section 26(b)(2) of such Code is 

2 amended by striking ‘‘and’’ at the end of sub3 paragraph (X), by striking the period at the 

4 end of subparagraph (Y) and inserting ‘‘, and’’, 

5 and by adding at the end the following new sub6 paragraph: 

7 ‘‘(Z) section 36C(g)(2) (relating to excess 

8 advance payments).’’. 

9 (B) Section 6211(b)(4)(A) of such Code, 

10 as amended by the preceding provisions of this 

11 subtitle, is amended— 

12 (i) by inserting ‘‘36C’’ after ‘‘36B’’, 

13 and 

14 (ii) by striking ‘‘and 6428A’’ and in15 serting ‘‘6428A, and 7527A’’. 

16 (C) Paragraph (2) of section 1324(b) of 

17 title 31, United States Code, is amended by 

18 striking ‘‘or 6431’’ and inserting ‘‘6431, or 

19 7527A’’. 

20 (D) The table of sections for chapter 77 of 

21 the Internal Revenue Code of 1986 is amended 

22 by inserting after the item relating to section 

23 7527 the following new item: 

‘‘Sec. 7527A. Advance payment of wage tax credit.’’. 


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1 (c) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to taxable years beginning after 

3 December 31, 2020. 

Æ 


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