I 

116TH CONGRESS 

2D SESSION H. R. 7837 

To provide a payroll tax credit for certain employee dependent care expenses 

paid by employers. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 29, 2020 

Mr. LAMB (for himself, Ms. SA ́NCHEZ, and Mr. FITZPATRICK) introduced the 

following bill; which was referred to the Committee on Ways and Means 

A BILL 

To provide a payroll tax credit for certain employee 

dependent care expenses paid by employers. 

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 ‘‘Supporting American 

5 Families, Employers, Kids and Jobs Act’’ or as the 

6 ‘‘SAFE Kids and Jobs Act’’. 


SSpencer on DSK126QN23PROD with BILLS
2 

•HR 7837 IH

1 SEC. 2. PAYROLL CREDIT FOR CERTAIN EMPLOYEE DE2 PENDENT CARE EXPENSES PAID BY EMPLOY3 ERS. 

4 (a) IN GENERAL.—In the case of an employer, there 

5 shall be allowed as a credit against applicable employment 

6 taxes for each calendar quarter an amount equal to 30 

7 percent of the qualified employee dependent care expenses 

8 paid by such employer with respect to such calendar quar9 ter. 

10 (b) LIMITATIONS AND REFUNDABILITY.— 

11 (1) DOLLAR LIMITATION PER EMPLOYEE.—The 

12 qualified employee dependent care expenses which 

13 may be taken into account under subsection (a) with 

14 respect to any employee for any calendar quarter 

15 shall not exceed $2,500. 

16 (2) CREDIT LIMITED TO CERTAIN EMPLOYMENT

17 TAXES.—The credit allowed by subsection (a) with 

18 respect to any calendar quarter shall not exceed the 

19 applicable employment taxes for such calendar quar20 ter (reduced by any credits allowed under sub21 sections (e) and (f) of section 3111 of such Code, 

22 sections 7001 and 7003 of the Families First 

23 Coronavirus Response Act, section 2301 of the 

24 CARES Act, and section 4 of this Act, for such 

25 quarter) on the wages paid with respect to the emVerDate Sep 11 2014 00:24 Aug 20, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H7837.IH H7837

SSpencer on DSK126QN23PROD with BILLS
3 

•HR 7837 IH

1 ployment of all the employees of the employer for 

2 such calendar quarter. 

3 (3) REFUNDABILITY OF EXCESS CREDIT.— 

4 (A) IN GENERAL.—If the amount of the 

5 credit under subsection (a) exceeds the limita6 tion of paragraph (2) for any calendar quarter, 

7 such excess shall be treated as an overpayment 

8 that shall be refunded under sections 6402(a) 

9 and 6413(b) of the Internal Revenue Code of 

10 1986. 

11 (B) TREATMENT OF PAYMENTS.—For pur12 poses of section 1324 of title 31, United States 

13 Code, any amounts due to an employer under 

14 this paragraph shall be treated in the same 

15 manner as a refund due from a credit provision 

16 referred to in subsection (b)(2) of such section. 

17 (4) COORDINATION WITH GOVERNMENT

18 GRANTS.—The qualified employee dependent care 

19 expenses taken into account under this section by 

20 any employer shall be reduced by any amounts pro21 vided by any Federal, State, or local government for 

22 purposes of making or reimbursing such expenses. 

23 (c) QUALIFIED EMPLOYEE DEPENDENT CARE EX24 PENSES.—For purposes of this section— 


SSpencer on DSK126QN23PROD with BILLS
4 

•HR 7837 IH

1 (1) IN GENERAL.—The term ‘‘qualified em2 ployee dependent care expenses’’ means any amount 

3 paid to or for the benefit of an employee in the em4 ployment of the employer if— 

5 (A) such amount is dependent care assist6 ance (as defined in section 129(e)(1) of the In7 ternal Revenue Code of 1986); and 

8 (B) the employer elects (at such time and 

9 in such manner as the Secretary may provide) 

10 to treat such amount as a qualified employee 

11 dependent care expense. 

12 (2) EXCLUSION OF AMOUNTS PAID THROUGH

13 SALARY REDUCTION ARRANGEMENTS.—Such term 

14 shall not include any amount paid at the election of 

15 the employee under a salary reduction arrangement. 

16 (d) SPECIAL RULES; OTHER DEFINITIONS.— 

17 (1) APPLICATION OF CERTAIN NON-DISCRIMINA18 TION RULES.—No credit shall be allowed under this 

19 section to any employer for any calendar quarter if 

20 qualified employee dependent care expenses are pro21 vided by such employer to employees for such cal22 endar quarter in a manner which discriminates in 

23 favor of highly compensated individuals (within the 

24 meaning of section 125) as to eligibility for, or the 

25 amount of, such benefit expenses. 


SSpencer on DSK126QN23PROD with BILLS
5 

•HR 7837 IH

1 (2) DENIAL OF DOUBLE BENEFIT.—For pur2 poses of chapter 1 of such Code, no deduction or 

3 credit (other than the credit allowed under this sec4 tion) shall be allowed for so much of qualified em5 ployee dependent care expenses as is equal to the 

6 credit allowed under this section. 

7 (3) THIRD-PARTY PAYORS.—Any credit allowed 

8 under this section shall be treated as a credit de9 scribed in section 3511(d)(2) of such Code. 

10 (4) APPLICABLE EMPLOYMENT TAXES.—For 

11 purposes of this section, the term ‘‘applicable em12 ployment taxes’’ means the following: 

13 (A) The taxes imposed under section 

14 3111(a) of the Internal Revenue Code of 1986. 

15 (B) So much of the taxes imposed under 

16 section 3221(a) of such Code as are attrib17 utable to the rate in effect under section 

18 3111(a) of such Code. 

19 (5) SECRETARY.—For purposes of this section, 

20 the term ‘‘Secretary’’ means the Secretary of the 

21 Treasury or the Secretary’s delegate. 

22 (6) CERTAIN TERMS.— 

23 (A) IN GENERAL.—Any term used in this 

24 section which is also used in chapter 21 or 22 

25 of such Code shall have the same meaning as 


SSpencer on DSK126QN23PROD with BILLS
6 

•HR 7837 IH

1 when used in such chapter (as the case may 

2 be). 

3 (B) CERTAIN PROVISIONS NOT TAKEN

4 INTO ACCOUNT EXCEPT FOR PURPOSES OF LIM5 ITING CREDIT TO EMPLOYMENT TAXES.—For 

6 purposes of subparagraph (A) (other than with 

7 respect to subsection (b)(2)), section 3121(b) of 

8 such Code shall be applied without regard to 

9 paragraphs (1), (5), (6), (7), (8), (10), (13), 

10 (18), (19), and (22) thereof (except with re11 spect to services performed in a penal institu12 tion by an inmate thereof) and section 

13 3231(e)(1) shall be applied without regard to 

14 the sentence that begins ‘‘Such term does not 

15 include remuneration’’. 

16 (e) CERTAIN GOVERNMENTAL EMPLOYERS.— 

17 (1) IN GENERAL.—The credit under this section 

18 shall not be allowed to the Federal Government or 

19 any agency or instrumentality thereof. 

20 (2) EXCEPTION.—Paragraph (1) shall not 

21 apply to any organization described in section 

22 501(c)(1) of the Internal Revenue Code of 1986 and 

23 exempt from tax under section 501(a) of such Code. 

24 (f) TREATMENT OF DEPOSITS.—The Secretary shall 

25 waive any penalty under section 6656 of such Code for 


SSpencer on DSK126QN23PROD with BILLS
7 

•HR 7837 IH

1 any failure to make a deposit of applicable employment 

2 taxes if the Secretary determines that such failure was due 

3 to the anticipation of the credit allowed under this section. 

4 (g) REGULATIONS.—The Secretary shall prescribe 

5 such regulations or other guidance as may be necessary 

6 to carry out the purposes of this section, including regula7 tions or other guidance— 

8 (1) to allow the advance payment of the credit 

9 determined under subsection (a), subject to the limi10 tations provided in this section, based on such infor11 mation as the Secretary shall require; 

12 (2) to provide for the reconciliation of such ad13 vance payment with the amount of the credit at the 

14 time of filing the return of tax for the applicable 

15 quarter or taxable year; 

16 (3) for recapturing the benefit of credits deter17 mined under this section in cases where there is a 

18 subsequent adjustment to the credit determined 

19 under subsection (a); and 

20 (4) with respect to the application of the credit 

21 to third-party payors (including professional em22 ployer organizations, certified professional employer 

23 organizations, or agents under section 3504 of such 

24 Code), including to allow such payors to submit doc25 umentation necessary to substantiate eligibility for, 


SSpencer on DSK126QN23PROD with BILLS
8 

•HR 7837 IH

1 and the amount of, the credit allowed under this sec2 tion. 

3 (h) APPLICATION OF SECTION.—This section shall 

4 apply only to qualified employee dependent care expenses 

5 paid after the date of the enactment of this Act and before 

6 January 1, 2021. 

7 (i) TRANSFERS TO CERTAIN TRUST FUNDS.—There 

8 are hereby appropriated to the Federal Old-Age and Sur9 vivors Insurance Trust Fund and the Federal Disability 

10 Insurance Trust Fund established under section 201 of 

11 the Social Security Act (42 U.S.C. 401) and the Social 

12 Security Equivalent Benefit Account established under 

13 section 15A(a) of the Railroad Retirement Act of 1974 

14 (45 U.S.C. 231n–1(a)) amounts equal to the reduction in 

15 revenues to the Treasury by reason of this section (without 

16 regard to this subsection). Amounts appropriated by the 

17 preceding sentence shall be transferred from the general 

18 fund at such times and in such manner as to replicate 

19 to the extent possible the transfers which would have oc20 curred to such Trust Fund or Account had this section 

21 not been enacted. 

Æ 


SSpencer on DSK126QN23PROD with BILLS