I 

110TH CONGRESS 

2D SESSION H. R. 5725 

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

against income tax for employing members of the Ready Reserve or 

National Guard. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 8, 2008 

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 or National Guard. 

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 ‘‘National Guard and 

5 Ready Reserves Employment Protection Act of 2008’’. 


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1 SEC. 2. CREDIT FOR EMPLOYERS WHO EMPLOY MEMBERS 

2 OF THE READY RESERVE OR NATIONAL 

3 GUARD. 

4 (a) IN GENERAL.—Subpart D of part IV of sub5 chapter A of chapter 1 of the Internal Revenue Code of 

6 1986 (relating to business-related credits) is amended by 

7 inserting after section 45N the following new section: 

8 ‘‘SEC. 45O. CREDIT FOR EMPLOYERS WHO EMPLOY MEM9 BERS OF THE READY RESERVE OR NATIONAL 

10 GUARD. 

11 ‘‘(a) ALLOWANCE OF CREDIT.—For purposes of sec12 tion 38, the amount of the Ready Reserve-National Guard 

13 employment credit determined under this section with re14 spect to any employer for any taxable year is 15 percent 

15 of the qualified wages paid or incurred during the calendar 

16 year which ends with or within such taxable year. 

17 ‘‘(b) QUALIFIED WAGES.— 

18 ‘‘(1) IN GENERAL.—For purposes of this sec19 tion, the term ‘qualified wages’ means any wages 

20 paid or incurred by an employer for services per21 formed by a Ready Reserve-National Guard em22 ployee. 

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

24 TAKEN INTO ACCOUNT.—With respect to each em25 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), 51(a), 1396(a), 1400P(b), or 1400R. 

9 ‘‘(c) READY RESERVE-NATIONAL GUARD EM10 PLOYEE.—For purposes of this section— 

11 ‘‘(1) IN GENERAL.—Except as otherwise pro12 vided in this subsection, the term ‘Ready Reserve13 National Guard employee’ means, with respect to 

14 any period, any employee of an employer if during 

15 such period— 

16 ‘‘(A) substantially all of the services per17 formed by such employee for such employer are 

18 performed in a trade or business of the em19 ployer, and 

20 ‘‘(B) such employee is a member of the 

21 Ready Reserve (as defined in section 10142 of 

22 title 10, United States Code) or the National 

23 Guard (as defined in section 101(c)(1) of such 

24 title 10). 


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

2 The term ‘National Guard-Ready Reserve employee’ 

3 shall not include any individual described in a sub4 paragraph of section 1396(d)(2). 

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

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

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

8 section 1397(a). 

9 ‘‘(2) CONTROLLED GROUPS, ETC.—Rules simi10 lar to the rules of subsections (b) and (c) of section 

11 1397 shall apply for purposes of this section. 

12 ‘‘(e) TERMINATION.—The term ‘wages’ shall not in13 clude any amount paid or incurred to an individual who 

14 begins work for the employer after December 31, 2011.’’. 

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

16 of section 280C of such Code (relating to denial of deduc17 tion for certain expenses for which credits are allowable) 

18 is amended by inserting ‘‘45O,’’ after ‘‘45A(a),’’. 

19 (c) CREDIT TO BE PART OF GENERAL BUSINESS

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

21 amended by striking ‘‘plus’’ at the end of paragraph (30), 

22 by striking the period at the end of paragraph (31) and 

23 inserting ‘‘, plus’’, and by inserting after paragraph (31) 

24 the following new paragraph: 


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1 ‘‘(32) the Ready Reserve-National Guard em2 ployment credit determined under section 45O(a).’’. 

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

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

5 of such Code is amended by adding at the end the fol6 lowing new item: 

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

National Guard.’’. 

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

8 this section shall apply to taxable years beginning after 

9 the date of the enactment of this Act. 

Æ 


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