I 

113TH CONGRESS 

2D SESSION H. R. 5173 

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

who provide paid family and medical leave. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 23, 2014 

Mr. CASSIDY 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 provide 

a credit to employers who provide paid family and medical leave. 

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 ‘‘Strong Families Act’’. 

5 SEC. 2. EMPLOYER CREDIT FOR PAID FAMILY AND MED6 ICAL LEAVE. 

7 (a) IN GENERAL.— 

8 (1) ALLOWANCE OF CREDIT.—Subpart D of 

9 part IV of subchapter A of chapter 1 of the Internal 


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1 Revenue Code of 1986 is amended by adding at the 

2 end the following new section: 

3 ‘‘SEC. 45S. EMPLOYER CREDIT FOR PAID FAMILY AND MED4 ICAL LEAVE. 

5 ‘‘(a) IN GENERAL.—For purposes of section 38, in 

6 the case of an eligible employer, the paid family and med7 ical leave credit is an amount equal to 25 percent of the 

8 amount of wages paid to qualifying employees during any 

9 period in which such employees are on family and medical 

10 leave. 

11 ‘‘(b) LIMITATIONS.— 

12 ‘‘(1) IN GENERAL.—The credit allowed under 

13 subsection (a) with respect to any employee for any 

14 taxable year shall not exceed the lesser of— 

15 ‘‘(A) $4,000, or 

16 ‘‘(B) the product of the wages normally 

17 paid to such employee for each hour (or frac18 tion thereof) of services performed for the em19 ployer and the number of hours (or fraction 

20 thereof) for which family and medical leave is 

21 taken. 

22 For purposes of subparagraph (B), in the case of 

23 any employee who is not paid on an hourly basis, the 

24 wages of such employee shall be prorated to an 

25 hourly basis under regulations established by the 


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1 Secretary, in consultation with the Secretary of 

2 Labor. 

3 ‘‘(2) MAXIMUM AMOUNT OF LEAVE SUBJECT TO

4 CREDIT.—The amount of family and medical leave 

5 that may be taken into account with respect to any 

6 employee under subsection (a) for any taxable year 

7 shall not exceed 12 weeks. 

8 ‘‘(c) ELIGIBLE EMPLOYER.—For purposes of this 

9 section— 

10 ‘‘(1) IN GENERAL.—The term ‘eligible em11 ployer’ means any employer who has in place a pol12 icy that meets the following requirements: 

13 ‘‘(A) The policy provides— 

14 ‘‘(i) all qualifying full-time employees 

15 with not less than 4 weeks of annual paid 

16 family and medical leave, and 

17 ‘‘(ii) all qualifying employees who are 

18 not full-time employees with an amount of 

19 annual paid family and medical leave that 

20 bears the same ratio to 4 weeks as— 

21 ‘‘(I) the number of hours the em22 ployee is expected to work during any 

23 week, bears to 

24 ‘‘(II) the number of hours an 

25 equivalent qualifying full-time emVerDate Mar 15 2010 02:59 Jul 26, 2014 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H5173.IH H5173

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1 ployee is expected to work during the 

2 week. 

3 ‘‘(B) The policy requires that the rate of 

4 payment under the program is not less than 

5 100 percent of the wages normally paid to such 

6 employee for services performed for the em7 ployer. 

8 ‘‘(2) SPECIAL RULE FOR CERTAIN EMPLOY9 ERS.— 

10 ‘‘(A) IN GENERAL.—An added employer 

11 shall not be treated as an eligible employer un12 less such employer provides paid family and 

13 medical leave under a policy with a provision 

14 that states that the employer— 

15 ‘‘(i) will not interfere with, restrain, 

16 or deny the exercise of or the attempt to 

17 exercise, any right provided under the pol18 icy, and 

19 ‘‘(ii) will not discharge or in any other 

20 manner discriminate against any individual 

21 for opposing any practice prohibited by the 

22 policy. 

23 ‘‘(B) ADDED EMPLOYER; ADDED EM24 PLOYEE.—For purposes of this paragraph— 


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1 ‘‘(i) ADDED EMPLOYEE.—The term 

2 ‘added employee’ means a qualifying em3 ployee who is not covered by title I of the 

4 Family and Medical Leave Act of 1993. 

5 ‘‘(ii) ADDED EMPLOYER.—The term 

6 ‘added employer’ means an eligible em7 ployer (determined without regard to this 

8 paragraph), whether or not covered by that 

9 title I, who offers paid family and medical 

10 leave to added employees. 

11 ‘‘(3) TREATMENT OF STATE-PAID BENEFITS.— 

12 For purposes of paragraph (1), any leave which is 

13 paid by a State or local government shall not be 

14 taken into account in determining the amount of 

15 paid family and medical leave provided by the em16 ployer. 

17 ‘‘(4) NO INFERENCE.—Nothing in this sub18 section shall be construed as subjecting an employer 

19 to any penalty, liability, or other consequence (other 

20 than ineligibility for the credit allowed by reason of 

21 subsection (a)) for failure to comply with the re22 quirements of this subsection. 

23 ‘‘(d) QUALIFYING EMPLOYEES.—For purposes of 

24 this section, the term ‘qualifying employee’ means any em25 ployee (as defined in section 3(e) of the Fair Labor StandVerDate Mar 15 2010 02:59 Jul 26, 2014 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H5173.IH H5173

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1 ards Act of 1938) who has been employed by the employer 

2 for 1 year or more. 

3 ‘‘(e) FAMILY AND MEDICAL LEAVE.—For purposes 

4 of this section, the term ‘family and medical leave’ means 

5 leave for any purpose described under subparagraph (A), 

6 (B), (C), (D), or (E) of paragraph (1), or paragraph (3), 

7 of section 102(a) of the Family and Medical Leave Act 

8 of 1993, whether the leave is provided under that Act or 

9 by a policy of the employer. Such term shall not include 

10 any leave provided as paid vacation leave, personal leave, 

11 or medical or sick leave (within the meaning of those 3 

12 terms under section 102(d)(2) of that Act). 

13 ‘‘(f) WAGES.—For purposes of this section, the term 

14 ‘wages’ has the meaning given such term by subsection 

15 (b) of section 3306 (determined without regard to any dol16 lar limitation contained in such section). Such term shall 

17 not include any amount taken into account for purposes 

18 of determining any other credit allowed under this sub19 part. 

20 ‘‘(g) ELECTION TO HAVE CREDIT NOT APPLY.— 

21 ‘‘(1) IN GENERAL.—A taxpayer may elect to 

22 have this section not apply for any taxable year. 

23 ‘‘(2) OTHER RULES.—Rules similar to the rules 

24 of paragraphs (2) and (3) of section 51(j) shall 

25 apply for purposes of this subsection.’’. 


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1 (b) CREDIT PART OF GENERAL BUSINESS CREDIT.— 

2 Section 38(b) of the Internal Revenue Code of 1986 is 

3 amended by striking ‘‘plus’’ at the end of paragraph (35), 

4 by striking the period at the end of paragraph (36) and 

5 inserting ‘‘, plus’’, and by adding at the end the following 

6 new paragraph: 

7 ‘‘(37) in the case of an eligible employer (as de8 fined in section 45S(c)), the paid family and medical 

9 leave credit determined under section 45S(a).’’. 

10 (c) CREDIT ALLOWED AGAINST AMT.—Subpara11 graph (B) of section 38(c)(4) of the Internal Revenue 

12 Code of 1986 is amended by redesignating clauses (vii) 

13 through (ix) as clauses (vii) through (x), respectively, and 

14 by inserting after clause (vi) the following new clause: 

15 ‘‘(vii) the credit determined under sec16 tion 45S,’’. 

17 (d) CONFORMING AMENDMENTS.— 

18 (1) DENIAL OF DOUBLE BENEFIT.—Section 

19 280C(a) of the Internal Revenue Code of 1986 is 

20 amended by inserting ‘‘45S(a),’’ after ‘‘45P(a),’’. 

21 (2) ELECTION TO HAVE CREDIT NOT APPLY.— 

22 Section 6501(m) of such Code is amended by insert23 ing ‘‘45S(g),’’ after ‘‘45H(g),’’. 

24 (3) CLERICAL AMENDMENT.—The table of sec25 tions for subpart D of part IV of subchapter A of 


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1 chapter 1 of such Code is amended by adding at the 

2 end the following new item: 

‘‘Sec. 45S. Employer credit for paid family and medical leave.’’. 

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

4 this section shall apply to taxable years beginning after 

5 the date of the enactment of this Act. 

Æ 


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