I 

111TH CONGRESS 

1ST SESSION H. R. 3620 

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

against income tax for employing members of the Ready Reserve and 

National Guard and veterans recently separated from the Armed Forces. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 22, 2009 

Mr. ALEXANDER 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 allow employers a credit against income tax for employing members of the Ready Reserve and National Guard and veterans recently separated from the Armed Forces. 

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 ‘‘Hiring Heroes Tax 

5 Incentive Act of 2009’’. 


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1 SEC. 2. CREDIT FOR EMPLOYERS WHO EMPLOY MEMBERS 

2 OF THE READY RESERVE AND NATIONAL 

3 GUARD AND VETERANS RECENTLY SEPA4 RATED FROM THE ARMED FORCES. 

5 (a) IN GENERAL.—Subpart D of part IV of sub6 chapter A of chapter 1 of the Internal Revenue Code of 

7 1986 (relating to business-related credits) is amended by 

8 inserting after section 45Q the following new section: 

9 ‘‘SEC. 45R. CREDIT FOR EMPLOYERS WHO EMPLOY MEM10 BERS OF THE READY RESERVE AND NA11 TIONAL GUARD AND VETERANS RECENTLY 

12 SEPARATED FROM THE ARMED FORCES. 

13 ‘‘(a) ALLOWANCE OF CREDIT.—For purposes of sec14 tion 38, the amount of the military employment credit de15 termined under this section with respect to any employer 

16 for any taxable year is 15 percent of the qualified wages 

17 paid or incurred during the calendar year which ends with 

18 or within such taxable year. 

19 ‘‘(b) QUALIFIED WAGES.— 

20 ‘‘(1) IN GENERAL.—For purposes of this sec21 tion, the term ‘qualified wages’ means any wages 

22 paid or incurred by an employer for services per23 formed by a qualified employee. 

24 ‘‘(2) ONLY FIRST $10,000 OF WAGES PER YEAR

25 TAKEN INTO ACCOUNT.—With respect to each em26 ployee, the amount of qualified wages which may be 


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1 taken into account for a calendar year shall not ex2 ceed $10,000. 

3 ‘‘(3) COORDINATION WITH OTHER CREDITS.— 

4 The $10,000 amount in paragraph (2) shall be re5 duced for any calendar year by the amount of wages 

6 paid or incurred during such year which are taken 

7 into account in determining the credit under section 

8 45A(a), 45P(a), 51(a), 1396(a), 1400P(b), or 

9 1400R. 

10 ‘‘(c) QUALIFIED EMPLOYEE.—For purposes of this 

11 section— 

12 ‘‘(1) QUALIFIED EMPLOYEE.—The term ‘quali13 fied employee’ means, with respect to any period, 

14 any employee of an employer if during such period— 

15 ‘‘(A) substantially all of the services per16 formed by such employee for such employer are 

17 performed in a trade or business of the em18 ployer, and 

19 ‘‘(B) such employee is— 

20 ‘‘(i) a Ready Reserve-National Guard 

21 employee, or 

22 ‘‘(ii) a recently-separated veteran. 

23 ‘‘(2) CERTAIN INDIVIDUALS NOT ELIGIBLE.— 

24 The term ‘qualified employee’ shall not include any 

25 individual described in a subparagraph of section 


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1 1396(d)(2) (relating to certain individuals not eligi2 ble to be qualified zone employees). 

3 ‘‘(3) READY RESERVE-NATIONAL GUARD EM4 PLOYEE.—The term ‘Ready Reserve-National Guard 

5 employee’ means an employee who is a member of 

6 the Ready Reserve (as defined in section 10142 of 

7 title 10, United States Code) or the National Guard 

8 (as defined in section 101(c)(1) of such title 10). 

9 ‘‘(4) RECENTLY-SEPARATED VETERAN.—The 

10 term ‘recently-separated veteran’ means an indi11 vidual who served on active duty (other than active 

12 duty for training) in the Armed Forces of the 

13 United States and was discharged or released there14 from under honorable conditions within the 5-year 

15 period ending on the date of the performance of 

16 services. 

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

18 ‘‘(1) WAGES.—For purposes of this section, the 

19 term ‘wages’ has the meaning given to such term by 

20 section 1397(a). 

21 ‘‘(2) CONTROLLED GROUPS, ETC.—Rules simi22 lar to the rules of subsections (b) and (c) of section 

23 1397 shall apply for purposes of this section. 


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1 ‘‘(e) TERMINATION.—The term ‘wages’ shall not in2 clude any amount paid or incurred to an individual who 

3 begins work for the employer after December 31, 2012.’’. 

4 (b) DENIAL OF DOUBLE BENEFIT.—Subsection (a) 

5 of section 280C of such Code (relating to denial of deduc6 tion for certain expenses for which credits are allowable) 

7 is amended by inserting ‘‘45R,’’ after ‘‘45P(a),’’. 

8 (c) CREDIT TO BE PART OF GENERAL BUSINESS

9 CREDIT.—Subsection (b) of section 38 of such Code is 

10 amended by striking ‘‘plus’’ at the end of paragraph (34), 

11 by striking the period at the end of paragraph (35) and 

12 inserting ‘‘, plus’’, and by inserting after paragraph (35) 

13 the following new paragraph: 

14 ‘‘(36) the military employment credit deter15 mined under section 45R(a).’’. 

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

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

18 of such Code is amended by adding at the end the fol19 lowing new item: 

‘‘Sec. 45R. Credit for employers who employ members of the Ready Reserve 

and National Guard and veterans recently separated from the 

Armed Forces.’’. 

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

21 this section shall apply to taxable years beginning after 

22 the date of the enactment of this Act. 

Æ 


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