I 

111TH CONGRESS 

2D SESSION H. R. 4437 

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

credit for increasing employment. 

IN THE HOUSE OF REPRESENTATIVES 

JANUARY 13, 2010 

Mr. ETHERIDGE (for himself, Mr. KAGEN, Mr. ISRAEL, Mr. JACKSON of Illinois, Mr. HINCHEY, Mr. COURTNEY, Mr. SKELTON, Mr. BUTTERFIELD, 

and Mr. PRICE of North Carolina) 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 refundable credit for increasing employment. 

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 Incentives to 

5 Reinvest and Incentivize New Growth Act of 2010’’ or the 

6 ‘‘HIRING Act of 2010’’. 


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1 SEC. 2. REFUNDABLE CREDIT FOR INCREASING EMPLOY2 MENT. 

3 (a) IN GENERAL.—Subpart C of part IV of sub4 chapter A of chapter 1 of the Internal Revenue Code of 

5 1986 (relating to refundable credits) is amended by insert6 ing after section 36A the following new section: 

7 ‘‘SEC. 36B. CREDIT FOR INCREASING EMPLOYMENT. 

8 ‘‘(a) IN GENERAL.—There shall be allowed as a cred9 it against the tax imposed by this subtitle— 

10 ‘‘(1) for any taxable year beginning in 2010, an 

11 amount equal to 15 percent of the excess (if any) 

12 of— 

13 ‘‘(A) the aggregate wages paid during 

14 2010, over 

15 ‘‘(B) the inflation-adjusted wages paid dur16 ing 2009, and 

17 ‘‘(2) for any taxable year beginning in 2011, an 

18 amount equal to 10 percent of the excess (if any) 

19 of— 

20 ‘‘(A) the aggregate wages paid during 

21 2011, over 

22 ‘‘(B) the inflation-adjusted wages paid dur23 ing 2010. 

24 ‘‘(b) QUARTERLY ADVANCE PAYMENTS OF CRED25 IT.— 


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1 ‘‘(1) IN GENERAL.—The Secretary shall pay 

2 (without interest) to each employer for each calendar 

3 quarter an amount equal to the credit percentage of 

4 the excess (if any) of— 

5 ‘‘(A) the aggregate wages paid by the em6 ployer during such quarter, over 

7 ‘‘(B) the inflation-adjusted wages paid by 

8 the employer during the comparable quarter of 

9 the preceding calendar year. 

10 ‘‘(2) CREDIT PERCENTAGE.—For purposes of 

11 paragraph (1), the credit percentage is— 

12 ‘‘(A) 15 percent in the case of the calendar 

13 quarters of 2010, and 

14 ‘‘(B) 10 percent in the case of the calendar 

15 quarters of 2011. 

16 ‘‘(3) RECONCILIATION.— 

17 ‘‘(A) IN GENERAL.—If there is a payment 

18 under paragraph (1) for 1 or more calendar 

19 quarters ending with or within a taxable year, 

20 then the tax imposed by this chapter for such 

21 taxable year shall be increased by the aggregate 

22 amount of such payments. 

23 ‘‘(B) RECONCILIATION.—Any increase in 

24 tax under subparagraph (A) shall not be treat25 ed as tax imposed by this chapter for purposes 


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1 of determining the amount of any credit (other 

2 than the credit under subsection (a)) allowable 

3 under this part. 

4 ‘‘(4) TIME FOR FILING CLAIM.—No claim shall 

5 be allowed under this subsection with respect to any 

6 calendar quarter unless filed on or before the earlier 

7 of— 

8 ‘‘(A) the last day of the succeeding quar9 ter, or 

10 ‘‘(B) the time prescribed by law for filing 

11 the return of tax imposed by this chapter for 

12 the taxable year in which or with which such 

13 quarter ends. 

14 ‘‘(5) INTEREST.—Notwithstanding paragraph 

15 (1), if the Secretary has not paid pursuant to a 

16 claim filed under this subsection within 45 days of 

17 the date of the filing of such claim (20 days in the 

18 case of an electronic claim), the claim shall be paid 

19 with interest from such date determined by using 

20 the overpayment rate and method under section 

21 6621. 

22 ‘‘(c) TOTAL WAGES MUST INCREASE.—The amount 

23 of credit allowed under this section for any taxable year 

24 shall not exceed the amount which would be so allowed 

25 for such year if— 


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1 ‘‘(1) the aggregate amounts taken into account 

2 as wages were determined without any dollar limita3 tion, and 

4 ‘‘(2) 103 percent of the amount of wages other5 wise required to be taken into account under sub6 section (a)(1)(B) or subsection (a)(2)(B), as the 

7 case may be, were taken into account. 

8 ‘‘(d) INFLATION-ADJUSTED WAGES; WAGES.—For 

9 purposes of this section— 

10 ‘‘(1) INFLATION-ADJUSTED WAGES.— 

11 ‘‘(A) IN GENERAL.—The term ‘inflation12 adjusted wages’ means, for any period— 

13 ‘‘(i) the aggregate wages paid by the 

14 employer during such period, increased by 

15 ‘‘(ii) an amount equal to the inflation 

16 percentage of such wages. 

17 ‘‘(B) INFLATION PERCENTAGE.—The infla18 tion percentage is— 

19 ‘‘(i) 3 percent for purposes of deter20 mining inflation-adjusted wages for periods 

21 during 2009, and 

22 ‘‘(ii) 5 percent for purposes of deter23 mining inflation-adjusted wages for periods 

24 during 2010. 

25 ‘‘(2) WAGES.— 


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1 ‘‘(A) IN GENERAL.—Except as provided in 

2 subparagraph (B), the term ‘wages’ means, 

3 with respect to any calendar year, so much of 

4 wages (as defined in section 3121(a)) as does 

5 not exceed the median household income in the 

6 United States for the preceding calendar year. 

7 ‘‘(B) RAILWAY LABOR.—In the case of re8 muneration subject to the tax imposed by 

9 3201(a), the term ‘wages’ means, with respect 

10 to any calendar year, so much of compensation 

11 (as defined in section 3231(e)) as does not ex12 ceed the median household income in the 

13 United States for the preceding calendar year. 

14 ‘‘(e) SPECIAL RULES.— 

15 ‘‘(1) ADJUSTMENTS FOR CERTAIN ACQUISI16 TIONS, ETC.— 

17 ‘‘(A) ACQUISITIONS.—If, after December 

18 31, 2008, an employer acquires the major por19 tion of a trade or business of another person 

20 (hereinafter in this subparagraph referred to as 

21 the ‘predecessor’) or the major portion of a sep22 arate unit of a trade or business of a prede23 cessor, then, for purposes of applying this sec24 tion for any calendar year ending after such ac25 quisition, the amount of wages deemed paid by 


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1 the employer during periods before such acqui2 sition shall be increased by so much of such 

3 wages paid by the predecessor with respect to 

4 the acquired trade or business as is attributable 

5 to the portion of such trade or business ac6 quired by the employer. 

7 ‘‘(B) DISPOSITIONS.—If, after December 

8 31, 2008— 

9 ‘‘(i) an employer disposes of the major 

10 portion of any trade or business of the em11 ployer or the major portion of a separate 

12 unit of a trade or business of the employer 

13 in a transaction to which subparagraph 

14 (A) applies, and 

15 ‘‘(ii) the employer furnishes the ac16 quiring person such information as is nec17 essary for the application of subparagraph 

18 (A), 

19 then, for purposes of applying this section for 

20 any calendar year ending after such disposition, 

21 the amount of wages deemed paid by the em22 ployer during periods before such disposition 

23 shall be decreased by so much of such wages as 

24 is attributable to such trade or business or sep25 arate unit. 


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1 ‘‘(2) CHANGE IN STATUS FROM SELF-EM2 PLOYED TO EMPLOYEE.—If— 

3 ‘‘(A) during 2009 or 2010 an individual 

4 has net earnings from self-employment (as de5 fined in section 1402(a)) which are attributable 

6 a trade or business, and 

7 ‘‘(B) for any portion of the succeeding cal8 endar year such individual is an employee of 

9 such trade or business, 

10 then, for purposes of determining the credit allow11 able for a taxable year beginning in such succeeding 

12 calendar year, the employer’s aggregate wages for 

13 2009 or 2010, as the case may be, shall be increased 

14 by an amount equal to so much of the net earnings 

15 referred to in subparagraph (A) as does not exceed 

16 the median household income in the United States 

17 for 2009 or 2010, as the case may be. 

18 ‘‘(3) CERTAIN OTHER RULES TO APPLY.—Rules 

19 similar to the following rules shall apply for pur20 poses of this section: 

21 ‘‘(A) Section 51(f) (relating to remunera22 tion must be for trade or business employment). 

23 ‘‘(B) Section 51(k) (relating to treatment 

24 of successor employers; treatment of employees 

25 performing services for other persons). 


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1 ‘‘(C) Section 52 (relating to special rules). 

2 ‘‘(4) SHORT TAXABLE YEARS.—If the employer 

3 has more than 1 taxable year beginning in 2010 or 

4 2011, the credit under this section shall be deter5 mined for the employer’s last taxable year beginning 

6 in 2010 or 2011, as the case may be. 

7 ‘‘(f) TAX-EXEMPT EMPLOYERS TREATED AS TAX8 PAYERS.—Solely for purposes of this section and section 

9 6402, employers exempt from tax under section 501(a) 

10 shall be treated as taxpayers.’’. 

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

12 of section 280C of such Code is amended by inserting 

13 ‘‘36B(a),’’ before ‘‘45A(a)’’. 

14 (c) CONFORMING AMENDMENTS.— 

15 (1) Section 1324(b)(2) of title 31, United 

16 States Code, is amended by inserting ‘‘36B,’’ after 

17 ‘‘36A,’’. 

18 (2) The table of sections for subpart C of part 

19 IV of subchapter A of chapter 1 of such Code is 

20 amended by inserting after the item relating to sec21 tion 36A the following new item: 

‘‘Sec. 36B. Credit for increasing employment.’’. 

22 (d) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to taxable years beginning after 

24 December 31, 2009. 


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1 (e) NOTICE OF AVAILABILITY OF CREDIT.—The Sec2 retary of the Treasury shall work with the State Employ3 ment Security Agencies to inform businesses of the avail4 ability of section 36B of the Internal Revenue Code of 

5 1986 (as added by this Act). 

Æ 


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