Safe Reopening Tax Credit

To provide for a credit against employment taxes for certain virus transmission prevention expenses, and for other purposes. 1. Short title This Act may be cited as the Safe Reopening Tax Credit 2. Tax credit for safety improvements (a) In general In the case of an eligible employer, there shall be allowed as a credit against applicable employment taxes for each calendar quarter an amount equal to 30 percent of the qualified virus transmission prevention expenses paid or incurred by such employer during such calendar quarter. (b) Limitations and refundability (1) Limitation The qualified fixed expenses which may be taken into account under subsection (a) by any eligible employer for any calendar quarter shall not exceed the least of— (A) $15,000, or (B) the greater of— (i) 25 percent of the wages paid with respect to the employment of all employees of the eligible employer for such calendar quarter, or (ii) 6.25 percent of gross receipts of the eligible employer for calendar year 2019. (2) Credit limited to certain employment taxes The credit allowed by subsection (a) with respect to any calendar quarter shall not exceed the applicable employment taxes for such calendar quarter (reduced by any credits allowed under subsections (e) and (f) of section 3111 of such Code, sections 7001 and 7003 of the Families First Coronavirus Response Act, and section 2301 of the CARES Act, for such quarter) on the wages paid with respect to the employment of all the employees of the eligible employer for such calendar quarter. (3) Refundability of excess credit (A) In general If the amount of the credit under subsection (a) exceeds the limitation of paragraph (2) for any calendar quarter, such excess shall be treated as an overpayment that shall be refunded under sections 6402(a) and 6413(b) of the Internal Revenue Code of 1986. (B) Treatment of payments For purposes of section 1324 of title 31, United States Code, any amounts due to an employer under this paragraph shall be treated in the same manner as a refund due from a credit provision referred to in subsection (b)(2) of such section. (c) Definitions For purposes of this section— (1) Applicable employment taxes The term applicable employment taxes (A) The taxes imposed under section 3111(a) (B) So much of the taxes imposed under section 3221(a) of such Code as are attributable to the rate in effect under section 3111(a) of such Code. (2) Eligible employer (A) In general The term eligible employer (i) which was carrying on a trade or business at any time during calendar year 2020, (ii) which had either— (I) not more than 1,500 full time equivalent employees (as determined for the purposes of determining whether an employer is an applicable large employer for the purposes of section 4980H(c)(2) (II) not more than $41,500,000 in gross receipts in the last taxable year ending in 2019, and (iii) is primarily an establishment classified under one of the following: (I) The North American Industry Classification System Sector codes 44, 45, 71, or 72. (II) The North American Industry Classification System Subsector code 624. (III) The North American Industry Classification System codes 512131 or 519120. (B) Tax-exempt organizations In the case of an organization which is described in section 501(c) (i) clauses (i) and (iii)(I) of subparagraph (A) shall apply to all operations of such organization, and (ii) any reference in this section to gross receipts shall be treated as a reference to gross receipts within the meaning of section 6033 (3) Qualified virus transmission prevention expenses The term qualified virus transmission prevention expenses (A) barriers erected to prevent virus spread between customers and employees, including plexiglass installed at cashiers and other counters, and partitions to separate customers, (B) changes to fixtures to facilitate social distancing, including additional check-out stations, (C) contactless point-of-sale systems, (D) enhanced sanitation, including deep cleaning and hand sanitizer, (E) thermometers and other virus monitoring devices or methods, including COVID–19 testing, (F) ventilation or air filtration, (G) signage related to public health awareness, social distancing, or altered services like curbside pickups, (H) employee health education, (I) training for new business procedures resulting from COVID–19, (J) personal protective equipment, and (K) such additional expenses as the Secretary, in consultation with the Secretary of Health and Human Services, determines to be necessary. (4) Secretary The term Secretary (d) Aggregation rule All persons treated as a single employer under subsection (a) or (b) of section 52 (e) Denial of double benefit For purposes of chapter 1 of such Code, the gross income of any eligible employer, for the taxable year which includes the last day of any calendar quarter with respect to which a credit is allowed under this section, shall be increased by the amount of such credit. (f) Election not To have section apply This section shall not apply with respect to any eligible employer for any calendar quarter if such employer elects (at such time and in such manner as the Secretary may prescribe) not to have this section apply. (g) Transfers to certain trust funds There are hereby appropriated to the Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund established under section 201 of the Social Security Act ( 42 U.S.C. 401 45 U.S.C. 231n–1(a) (h) Treatment of deposits The Secretary shall waive any penalty under section 6656 of such Code for any failure to make a deposit of applicable employment taxes if the Secretary determines that such failure was due to the anticipation of the credit allowed under this section. (i) Regulations and guidance The Secretary shall issue such forms, instructions, regulations, and guidance as are necessary— (1) to allow the advance payment of the credit under subsection (a), subject to the limitations provided in this section, based on such information as the Secretary shall require, (2) to provide for the reconciliation of such advance payment with the amount of the credit at the time of filing the return of tax for the applicable quarter or taxable year, (3) with respect to the application of the credit under subsection (a) to third-party payors (including professional employer organizations, certified professional employer organizations, or agents under section 3504 (4) for application of subsection (c)(2)(A)(ii) in the case of any employer which was not carrying on a trade or business for all or part of the same calendar quarter in the prior year, and (5) for recapturing the benefit of credits determined under this section in cases where there is a subsequent adjustment to the credit determined under subsection (a). (j) Application of section This section shall apply only to qualified fixed expenses paid or accrued in calendar quarters beginning on or after the date of the enactment of this Act and before January 1, 2021.

Summary: Safe Reopening Tax Credit This bill allows an eligible employer a payroll tax credit for 30% of qualified virus transmission prevention expenses. The bill defines qualified virus transmission prevention expenses as expenses for reducing or preventing the transmission of communicable viruses, including the coronavirus (i.e., the virus that causes COVID-19). Such expenses include amounts paid for barriers erected to prevent virus spread between customers and employees, contactless point-of-sale systems, enhanced sanitation, ventilation or air filtration, and employee health education. The bill limits the amount of expenses that may be taken into account in computing the credit and the credit's period of applicability to calendar quarters beginning on or after the enactment of this bill and before January 1, 2021.