I 

112TH CONGRESS 

2D SESSION H. R. 4394 

To provide incentives to encourage financial institutions and small businesses 

to provide continuing financial education to customers, borrowers, and 

employees, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 18, 2012 

Ms. EDDIE BERNICE JOHNSON of Texas introduced the following bill; which 

was referred to the Committee on Ways and Means, and in addition to 

the Committees on Financial Services and Small Business, for a period 

to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee 

concerned 

A BILL 

To provide incentives to encourage financial institutions and 

small businesses to provide continuing financial education 

to customers, borrowers, and employees, and for other 

purposes. 

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 ‘‘National Financial Lit5 eracy Act of 2012’’. 


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1 SEC. 2. FINANCIAL LITERACY PROGRAMS. 

2 Section 804 of the Community Reinvestment Act of 

3 1977 (12 U.S.C. 2903) is amended by adding at the end 

4 the following new subsection: 

5 ‘‘(e) DIRECT SUPPORT FOR FINANCIAL LITERACY

6 PROGRAMS TAKEN INTO ACCOUNT.— 

7 ‘‘(1) STANDARDS ESTABLISHED FOR ELIGIBLE

8 PROGRAMS.—The appropriate Federal financial su9 pervisory agencies shall jointly prescribe regulations 

10 establishing— 

11 ‘‘(A) the minimum standards required to 

12 be met by a community-based financial literacy 

13 program in order to be eligible for consideration 

14 under paragraph (3) as a qualified community15 based financial literacy program; 

16 ‘‘(B) the procedures for financial institu17 tions to apply to the appropriate Federal finan18 cial supervisory agency for approval of a finan19 cial literacy program as a qualified community20 based financial literacy program; and 

21 ‘‘(C) a requirement that financial institu22 tions submit a regular report on how the insti23 tution supported and promoted financial lit24 eracy in its entire community, including low25 and moderate-income neighborhoods. 


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1 ‘‘(2) FACTORS.—The regulations required 

2 under paragraph (1) shall require at a minimum 

3 that a qualified community-based financial literacy 

4 program— 

5 ‘‘(A) be offered by a nonprofit budget and 

6 counseling agency which is exempt from tax7 ation under section 501(c)(3) of the Internal 

8 Revenue Code of 1986; and 

9 ‘‘(B) include adequate education to pro10 mote consumer understanding of consumer, eco11 nomic, and personal finance issues and con12 cepts, including saving for retirement, man13 aging credit, long-term care, estate planning 

14 and education on predatory lending, identity 

15 theft, and financial abuse schemes. 

16 ‘‘(3) PROGRAMS TAKEN INTO ACCOUNT.—The 

17 direct support by a financial institution of a quali18 fied community-based financial literacy program 

19 may be taken into account by the appropriate Fed20 eral financial supervisory agency under subsection 

21 (a) in assessing the institution’s record of meeting 

22 the credit needs of its entire community, including 

23 low- and moderate-income neighborhoods, in such 

24 amount and to such extent as may be provided in 


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1 the joint regulations prescribed under paragraph 

2 (1).’’. 

3 SEC. 3. CREDIT AGAINST INCOME TAX FOR SMALL BUSI4 NESSES WHICH PROVIDE CONTINUING FI5 NANCIAL EDUCATION TO EMPLOYEES. 

6 (a) IN GENERAL.—Subpart D of part IV of sub7 chapter A of chapter 1 of the Internal Revenue Code of 

8 1986 is amended by adding at the end the following new 

9 section: 

10 ‘‘SEC. 45S. SMALL BUSINESSES PROVIDING CONTINUING FI11 NANCIAL EDUCATION TO EMPLOYEES. 

12 ‘‘(a) IN GENERAL.—In the case of an eligible small 

13 business, the continuing financial education credit deter14 mined under this section is an amount equal to 35 percent 

15 of the continuing financial education expenses paid or in16 curred by the taxpayer during the taxable year. 

17 ‘‘(b) ELIGIBLE SMALL BUSINESS.—For purposes of 

18 this section, the term ‘eligible small business’ means any 

19 small business which provides without charge a qualified 

20 continuing financial education program to its employees 

21 throughout the taxable year. 

22 ‘‘(c) QUALIFIED CONTINUING FINANCIAL EDU23 CATION PROGRAM.—For purposes of this section— 


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1 ‘‘(1) IN GENERAL.—The term ‘qualified con2 tinuing financial education program’ means any edu3 cational program or services— 

4 ‘‘(A) which is provided by a community5 based budget and counseling agency which is 

6 described in section 501(c)(3) and exempt from 

7 tax under section 501(a), 

8 ‘‘(B) which promotes consumer under9 standing of consumer, economic, and personal 

10 finance issues and concepts, including saving 

11 for retirement, managing credit, long-term care, 

12 estate planning and education on predatory 

13 lending, identity theft, and financial abuse 

14 schemes, 

15 ‘‘(C) which is offered to all employees of 

16 the taxpayer who have at least 2 weeks of serv17 ice with the employer, and 

18 ‘‘(D) which is offered during— 

19 ‘‘(i) at least 24 hours of each month 

20 if the taxpayer is a corporation, or 

21 ‘‘(ii) at least 16 hours of each month 

22 in any other case. 

23 ‘‘(d) SMALL BUSINESS.—For purposes of this sec24 tion— 


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1 ‘‘(1) IN GENERAL.—The term ‘small business’ 

2 means, with respect to any taxable year, any em3 ployer if— 

4 ‘‘(A) such employer employed an average 

5 of at least 2 but not more than 50 employees 

6 on business days during the most recent cal7 endar year ending before such taxable year, and 

8 ‘‘(B) such employer employed at least 2 

9 employees on the first day of the taxable year. 

10 ‘‘(2) EMPLOYERS NOT IN EXISTENCE IN PRE11 CEDING YEAR.—In the case of an employer which 

12 was not in existence throughout the calendar year 

13 referred to in paragraph (1), the determination 

14 under paragraph (1) shall be based on the average 

15 number of employees that it is reasonably expected 

16 such employer will employ on business days in the 

17 taxable year. 

18 ‘‘(3) SPECIAL RULES.— 

19 ‘‘(A) CONTROLLED GROUPS.—For pur20 poses of this subsection, all persons treated as 

21 a single employer under subsection (b), (c), 

22 (m), or (o) of section 414 shall be treated as 1 

23 employer. 

24 ‘‘(B) PREDECESSORS.—Any reference in 

25 this subsection to an employer shall include a 


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1 reference to any predecessor of such em2 ployer.’’. 

3 (b) DENIAL OF DOUBLE BENEFIT.—Section 280C of 

4 such Code is amended by adding at the end the following 

5 new subsection: 

6 ‘‘(j) CREDIT FOR SMALL BUSINESSES PROVIDING

7 CONTINUING FINANCIAL EDUCATION TO EMPLOYEES.— 

8 No deduction shall be allowed for that portion of the ex9 penses paid or incurred during the taxable year which is 

10 equal to the credit determined for the taxable year under 

11 sections 45S(a). In the case of persons treated as a single 

12 employer under section 45S(d)(3)(A), this subsection shall 

13 be applied under rules prescribed by the Secretary similar 

14 to the rules applicable under subsections (a) and (b) of 

15 section 52.’’. 

16 (c) CREDIT TO BE PART OF GENERAL BUSINESS

17 CREDIT.—Section 38(b) of such Code is amended by strik18 ing ‘‘plus’’ at the end of paragraph (35), by striking the 

19 period at the end of paragraph (36) and inserting ‘‘, plus’’, 

20 and by adding at the end the following new paragraph: 

21 ‘‘(37) the continuing financial education credit 

22 under section 45S(a).’’. 

23 (d) CLERICAL AMENDMENT.—The table of sections 

24 for subpart D of part IV of subchapter A of chapter 1 


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1 of such Code is amended by adding at the end the fol2 lowing new item: 

‘‘Sec. 45S. Small businesses providing continuing financial education to employees.’’. 

3 (e) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply to taxable years beginning after 

5 December 31, 2011. 

6 SEC. 4. PREFERENCE IN FEDERAL CONTRACTS, LOANS, 

7 AND OTHER ASSISTANCE FOR SMALL BUSI8 NESSES AND CORPORATIONS PROVIDING 

9 CONTINUING FINANCIAL EDUCATION TO EM10 PLOYEES. 

11 (a) PREFERENCE.—In the case of any Federal con12 tract or any Federal financial or nonfinancial assistance, 

13 an eligible small business or an eligible corporation shall 

14 be given a preference when submitting a bid or proposal 

15 for the contract or applying for such assistance. 

16 (b) DEFINITIONS.—In this section: 

17 (1) ELIGIBLE SMALL BUSINESS.—The term ‘‘el18 igible small business’’ has the meaning provided in 

19 section 45S(b) of the Internal Revenue Code of 

20 1986. 

21 (2) ELIGIBLE CORPORATION.—The term ‘‘eligi22 ble corporation’’ means any corporation— 

23 (A) that employs 50 or more employees; 

24 and 


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1 (B) that provides without charge a quali2 fied continuing financial education program to 

3 its employees throughout the taxable year. 

4 (3) QUALIFIED CONTINUING FINANCIAL EDU5 CATION PROGRAM.—The term ‘‘qualified continuing 

6 financial education program’’ has the meaning pro7 vided in section 45S(c) of the Internal Revenue Code 

8 of 1986. 

9 (4) FEDERAL FINANCIAL OR NONFINANCIAL AS10 SISTANCE.—The term ‘‘Federal financial or non11 financial assistance’’ means— 

12 (A) all programs and activities involving 

13 Federal financial and nonfinancial assistance 

14 and benefits, as covered by Executive Order No. 

15 12549 and guidelines implementing that order; 

16 and 

17 (B) procurement programs and activities, 

18 including Federal contracts for the procurement 

19 of goods or services. 

20 (c) EFFECTIVE DATE.—The preference required 

21 under subsection (a) shall be applied beginning on Janu22 ary 1, 2013. 

Æ 


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