II 

113TH CONGRESS 

1ST SESSION S. 115 

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

increasing payroll. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 23 (legislative day, JANUARY 3), 2013 

Mr. CASEY 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 increasing payroll. 

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 ‘‘Small Business Job 

5 Creation Act’’. 

6 SEC. 2. EMPLOYER PAYROLL INCREASE CREDIT. 

7 (a) IN GENERAL.—Subchapter B of chapter 65 of the 

8 Internal Revenue Code of 1986 is amended by adding at 

9 the end the following new section: 


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1 ‘‘SEC. 6433. EMPLOYER PAYROLL INCREASE CREDITS. 

2 ‘‘(a) IN GENERAL.—Each qualified employer shall be 

3 treated as having made a payment against the tax imposed 

4 by section 3111(a) or section 3221(a), whichever is appli5 cable, for each qualified quarter in an amount equal to 

6 the credit amount. 

7 ‘‘(b) CREDIT AMOUNT.—For purposes of this section, 

8 the credit amount with respect to any qualified quarter 

9 is equal to 10 percent of the qualified payroll increase of 

10 such employer for such qualified quarter. 

11 ‘‘(c) DOLLAR LIMITATION.—The total credit amount 

12 with respect to any employer shall not exceed $500,000 

13 for all qualified quarters. 

14 ‘‘(d) QUALIFIED EMPLOYER.—For purposes of this 

15 section, the term ‘qualified employer’ means any American 

16 employer other than the United States, any State, or any 

17 instrumentality thereof. 

18 ‘‘(e) QUALIFIED PAYROLL INCREASE.—For purposes 

19 of this section— 

20 ‘‘(1) IN GENERAL.—The term ‘qualified payroll 

21 increase’ with respect to any qualified quarter means 

22 the amount, if any, by which a qualified employer’s 

23 qualified payroll for such quarter exceeds the quali24 fied payroll for such quarter of the calendar year 

25 preceding the year in which such qualified quarter 

26 falls. 


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1 ‘‘(2) QUALIFIED PAYROLL.—The term ‘quali2 fied payroll’ means the amount of all wages (within 

3 the meaning of section 3121(a)) paid or incurred by 

4 a qualified employer to the employees of such em5 ployer, except that, with respect to each such em6 ployee for any quarter of the employer, such wages 

7 shall be taken into account only to the extent that 

8 such wages do not exceed the contribution and ben9 efit base as determined under section 230 of the So10 cial Security Act. 

11 ‘‘(3) RAILWAY LABOR.—In the case of remu12 neration subject to the tax imposed by section 

13 3221(a), paragraph (1) shall be applied by sub14 stituting ‘all compensation (within the meaning of 

15 section 3231(e))’ for ‘all wages (within the meaning 

16 of section 3121(a))’. 

17 ‘‘(4) SPECIAL RULE FOR LARGE EMPLOYERS.— 

18 In the case of an employer that employs 100 or 

19 more employees during the qualified quarter, no 

20 qualified payroll increase shall be taken into account 

21 for such qualified quarter unless the qualified pay22 roll increase with respect to such qualified quarter 

23 exceeds 3 percent of the qualified payroll for such 

24 quarter of the calendar year preceding the year in 

25 which such qualified quarter falls. 


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1 ‘‘(f) QUALIFIED QUARTER.—For purposes of this 

2 section, the term ‘qualified quarter’ means— 

3 ‘‘(1) the calendar quarter which includes the 

4 date of the enactment of the Small Business Job 

5 Creation Act, and 

6 ‘‘(2) each of the 3 calendar quarters following 

7 such quarter. 

8 ‘‘(g) DEFINITIONS.—Except as provided in sub9 section (h)(1), any term used in this section which is also 

10 used in section 3111 has the same meaning as when used 

11 in such section. 

12 ‘‘(h) SPECIAL RULES.—For purposes of this sec13 tion— 

14 ‘‘(1) EMPLOYEE.—The term ‘employee’ includes 

15 only individuals who are citizens or lawful residents 

16 of the United States who receive wages, remunera17 tion, compensation, or tips from an employer for 

18 work performed within a State or a possession of the 

19 United States. 

20 ‘‘(2) MAINTENANCE OF BASE EMPLOYMENT RE21 QUIREMENT.—This section shall not apply to any 

22 qualified employer for any qualified quarter if the 

23 total number of employees of such employer during 

24 such quarter is less than the total number of such 

25 employees during the quarter preceding such quarVerDate Mar 15 2010 04:13 Jan 31, 2013 Jkt 029200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S115.IS S115

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1 ter, determined by not taking into account any em2 ployee who is a seasonal employee during such pre3 ceding quarter. 

4 ‘‘(3) CONTROLLED GROUPS.—All employers 

5 treated as a single employer under section (a) or (b) 

6 of section 52 shall be treated as a single employer 

7 for purposes of the dollar limitation under sub8 section (c), except that any employer which is not an 

9 American employer shall not be taken into account. 

10 ‘‘(4) NEW EMPLOYERS.— 

11 ‘‘(A) IN GENERAL.—In the case of a quali12 fied employer which comes into existence after 

13 the date of the enactment of the Small Business 

14 Job Creation Act and before January 1, 

15 2014— 

16 ‘‘(i) the term ‘qualified quarter’ 

17 means— 

18 ‘‘(I) the first calendar quarter for 

19 which such qualified employer is in 

20 existence, and 

21 ‘‘(II) each of the 3 quarters fol22 lowing such quarter, 

23 ‘‘(ii) the qualified payroll increase of 

24 such employer for the quarter described in 

25 clause (i)(I) shall be equal to the amount 


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1 of the employer’s qualified payroll for such 

2 quarter, and 

3 ‘‘(iii) the qualified payroll increase of 

4 such employer for any quarter described in 

5 clause (i)(II) shall be the amount, if any, 

6 by which the employer’s qualified payroll 

7 for such quarter exceeds the qualified pay8 roll of the quarter preceding such quarter. 

9 ‘‘(B) TRANSITION RULE.— 

10 ‘‘(i) IN GENERAL.—In the case of a 

11 qualified employer which comes into exist12 ence— 

13 ‘‘(I) after the last day of the cal14 endar quarter which is 5 calendar 

15 quarters before the date of the enact16 ment of the Small Business Job Cre17 ation Act, and 

18 ‘‘(II) before such date of enact19 ment, 

20 the qualified payroll increase of such em21 ployer for any transition quarter shall be 

22 the amount, if any, by which the employ23 er’s qualified payroll for such quarter ex24 ceeds the qualified payroll of the quarter 

25 preceding such quarter. 


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1 ‘‘(ii) TRANSITION QUARTER.—For 

2 purposes of clause (i), the term ‘transition 

3 quarter’ means a qualified quarter with re4 spect to which the qualified payroll in5 crease cannot be determined under sub6 section (e)(1) solely because the employer 

7 was not in existence during such quarter of 

8 the calendar year preceding the year in 

9 which such qualified quarter falls.’’. 

10 (b) CLERICAL AMENDMENT.—The table of sections 

11 for subchapter B of chapter 65 of the Internal Revenue 

12 Code of 1986 is amended by adding at the end the fol13 lowing new item: 

‘‘Sec. 6433. Employer payroll increase credits.’’. 

14 (c) NOTIFICATION.—Not later than 30 days after the 

15 date of the enactment of this Act, the Commissioner of 

16 Internal Revenue shall notify all employers required to 

17 withhold employment taxes under chapter 21 or 22 of the 

18 Internal Revenue Code of 1986 of the enactment and ap19 plicability of section 6433 of the Internal Revenue Code 

20 of 1986, as added by this Act. 

21 (d) INVESTIGATION AND REPORT ON ENFORCEMENT

22 ACTIONS.—Not later than 6 months after the date of the 

23 enactment of this Act, and quarterly thereafter, the Com24 missioner of Internal Revenue shall submit a report to the 

25 Committee on Finance of the Senate and the Committee 


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1 on Ways and Means of the House of Representatives on 

2 the enforcement measures taken to prevent and penalize 

3 fraud related to section 6433 of the Internal Revenue 

4 Code of 1986, including such information as— 

5 (1) general statistics related to the application 

6 of such section, 

7 (2) cases of fraud, and 

8 (3) the status of investigatory and prosecutorial 

9 actions related to such cases. 

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

11 subsections (a) and (b) shall apply to calendar quarters 

12 beginning with the calendar quarter which includes the 

13 date of the enactment of this Act. 

Æ 


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