I 

108TH CONGRESS 

1ST SESSION H. R. 3608

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

for hiring new employees. 

IN THE HOUSE OF REPRESENTATIVES 

NOVEMBER 21, 2003

Ms. HOOLEY of Oregon (for herself, Mr. FROST, Mr. WU, Mrs. MCCARTHY

of New York, Mr. DEFAZIO, Mr. EVANS, Ms. CARSON of Indiana, Mr. 

PAUL, Ms. MCCOLLUM, and Ms. DEGETTE) 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 credit to employers for hiring new employees.

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 ‘‘Expand America’s 

5 Workforce Act of 2003’’. 

6 SEC. 2. NEW EMPLOYEE CREDIT ADDED TO GENERAL BUSI7 NESS CREDIT. 

8 (a) IN GENERAL.—Subpart D of part IV of sub9 chapter A of chapter 1 of the Internal Revenue Code of 
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1 1986 (relating to business-related credits) is amended by 

2 adding at the end the following new section: 

3 ‘‘SEC. 45G. NEW EMPLOYEE CREDIT. 

4 ‘‘(a) GENERAL RULE.—For purposes of section 38, 

5 the new employee credit determined under this section for 

6 a taxable year is an amount equal to $5,000 multiplied 

7 by the number of new qualified employees for the taxable 

8 year. 

9 ‘‘(b) LIMITATION.—For purposes of subsection (a), 

10 the number of employees treated as new qualified employ11 ees for the taxable year may not exceed the excess (if any) 

12 of—

13 ‘‘(1) the number of full-time employees of the 

14 taxpayer on the last day of the taxable year, over 

15 ‘‘(2) the number of full-time employees of the 

16 taxpayer on the first day of the taxable year. 

17 ‘‘(c) NEW QUALIFIED EMPLOYEES.—

18 ‘‘(1) IN GENERAL.—For purposes of this sec19 tion, the term ‘new qualified employee’ means an in20 dividual who—

21 ‘‘(A) as of the last day of the taxable year 

22 of the employer, is a full-time employee of the 

23 employer, and 

24 ‘‘(B) first began full-time employment with 

25 the employer during the 12-month period begin-
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1 ning 9 months before the end of the preceding 

2 taxable year and ending on the last day of the 

3 3rd month beginning in the taxable year. 

4 ‘‘(2) EXCEPTION.—No individual with respect 

5 to whom a credit is determined for the taxable year 

6 under section 51 shall be treated as a new qualified 

7 employee. 

8 ‘‘(d) SPECIAL RULES.—For purposes of this sec9 tion—

10 ‘‘(1) FULL-TIME EMPLOYMENT.—An employee 

11 shall be considered full-time if such employee is em12 ployed at least 30 hours per week for each week dur13 ing the 12-month period referred to in subsection 

14 (b)(1). 

15 ‘‘(2) AGGREGATION RULE.—All persons treated 

16 as a single employer under subsection (a) or (b) of 

17 section 52, or subsection (m) or (o) of section 414, 

18 shall be treated as one person. 

19 ‘‘(e) TERMINATION.—This section shall not apply to 

20 taxable years beginning after December 31, 2005.’’. 

21 (b) CREDIT TO BE PART OF GENERAL BUSINESS

22 CREDIT.—Subsection (b) of section 38 of such Code (re23 lating to general business credit) is amended by striking 

24 ‘‘plus’’ at the end of paragraph (14), by striking the period 
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1 at the end of paragraph (15) and inserting ‘‘, plus’’, and 

2 by adding at the end the following new paragraph: 

3 ‘‘(16) the new employee credit determined 

4 under section 45G(a).’’. 

5 (c) LIMITATION ON CARRYBACK.—Section 39(d) of 

6 such Code (relating to transitional rules) is amended by 

7 adding at the end the following new paragraph: 

8 ‘‘(11) NO CARRYBACK OF NEW EMPLOYEE

9 CREDIT BEFORE EFFECTIVE DATE.—No portion of 

10 the unused business credit for any taxable year 

11 which is attributable to the credit determined under 

12 section 45G may be carried back to any taxable year 

13 ending on or before the date of the enactment of 

14 section 45G.’’. 

15 (d) CONFORMING AMENDMENT.—The table of sec16 tions for subpart D of part IV of subchapter A of chapter 

17 1 of such Code is amended by inserting after the item 

18 relating to section 45F the following new item:

‘‘45G. New employee credit.’’.

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

20 this section shall apply to taxable years beginning after 

21 December 31, 2003.

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