National Financial Literacy Act of 2013

To provide incentives to encourage financial institutions and small businesses to provide continuing financial education to customers, borrowers, and employees, and for other purposes. 1. Short title This Act may be cited as the National Financial Literacy Act of 2013 2. Financial literacy programs Section 804 of the Community Reinvestment Act of 1977 ( 12 U.S.C. 2903 (e) Direct support for financial literacy programs taken into account (1) Standards established for eligible programs The appropriate Federal financial supervisory agencies shall jointly prescribe regulations establishing— (A) the minimum standards required to be met by a community-based financial literacy program in order to be eligible for consideration under paragraph (3) as a qualified community-based financial literacy program; (B) the procedures for financial institutions to apply to the appropriate Federal financial supervisory agency for approval of a financial literacy program as a qualified community-based financial literacy program; and (C) a requirement that financial institutions submit a regular report on how the institution supported and promoted financial literacy in its entire community, including low- and moderate-income neighborhoods. (2) Factors The regulations required under paragraph (1) shall require at a minimum that a qualified community-based financial literacy program— (A) be offered by a nonprofit budget and counseling agency which is exempt from taxation under section 501(c)(3) (B) include adequate education to promote consumer understanding of consumer, economic, and personal finance issues and concepts, including saving for retirement, managing credit, long-term care, estate planning and education on predatory lending, identity theft, and financial abuse schemes. (3) Programs taken into account The direct support by a financial institution of a qualified community-based financial literacy program may be taken into account by the appropriate Federal financial supervisory agency under subsection (a) in assessing the institution’s record of meeting the credit needs of its entire community, including low- and moderate-income neighborhoods, in such amount and to such extent as may be provided in the joint regulations prescribed under paragraph (1). . 3. Credit against income tax for small businesses which provide continuing financial education to employees (a) In general Subpart D of part IV of subchapter A of chapter 1 45S. Small businesses providing continuing financial education to employees (a) In general In the case of an eligible small business, the continuing financial education credit determined under this section is an amount equal to 35 percent of the continuing financial education expenses paid or incurred by the taxpayer during the taxable year. (b) Eligible small business For purposes of this section, the term eligible small business (c) Qualified continuing financial education program For purposes of this section— (1) In general The term qualified continuing financial education program (A) which is provided by a community-based budget and counseling agency which is described in section 501(c)(3) and exempt from tax under section 501(a), (B) which promotes consumer understanding of consumer, economic, and personal finance issues and concepts, including saving for retirement, managing credit, long-term care, estate planning and education on predatory lending, identity theft, and financial abuse schemes, (C) which is offered to all employees of the taxpayer who have at least 2 weeks of service with the employer, and (D) which is offered during— (i) at least 24 hours of each month if the taxpayer is a corporation, or (ii) at least 16 hours of each month in any other case. (d) Small business For purposes of this section— (1) In general The term small business (A) such employer employed an average of at least 2 but not more than 50 employees on business days during the most recent calendar year ending before such taxable year, and (B) such employer employed at least 2 employees on the first day of the taxable year. (2) Employers not in existence in preceding year In the case of an employer which was not in existence throughout the calendar year referred to in paragraph (1), the determination under paragraph (1) shall be based on the average number of employees that it is reasonably expected such employer will employ on business days in the taxable year. (3) Special rules (A) Controlled groups For purposes of this subsection, all persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 shall be treated as 1 employer. (B) Predecessors Any reference in this subsection to an employer shall include a reference to any predecessor of such employer. . (b) Denial of double benefit Section 280C of such Code is amended— (1) by redesignating the second subsection (g) (related to the qualifying therapeutic discovery project credit) as subsection (i); and (2) by adding at the end the following new subsection: (j) Credit for small businesses providing continuing financial education to employees No deduction shall be allowed for that portion of the expenses paid or incurred during the taxable year which is equal to the credit determined for the taxable year under sections 45S(a). In the case of persons treated as a single employer under section 45S(d)(3)(A), this subsection shall be applied under rules prescribed by the Secretary similar to the rules applicable under subsections (a) and (b) of section 52. . (c) Credit To be part of general business credit Section 38(b) of such Code is amended by striking plus , plus (37) the continuing financial education credit under section 45S(a). . (d) Clerical amendment The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item: Sec. 45S. Small businesses providing continuing financial education to employees. (e) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2012.

Summary: National Financial Literacy Act of 2013 - Amends the Community Reinvestment Act of 1977 to require federal financial supervisory agencies jointly to prescribe regulations establishing: (1) minimum standards to be met by a community-based financial literacy program in order to be eligible for consideration as a qualified community-based financial literacy program; (2) procedures for financial institutions to apply to a federal financial supervisory agency for approval of such a program; and (3) a requirement that financial institutions submit a regular report on how the institution supported and promoted financial literacy in its entire community, including low- and moderate-income neighborhoods. Authorizes a federal financial supervisory agency to take an institution's direct support of a qualified community-based financial literacy program into account when it assesses the institution's record of meeting the community's credit needs. Amends the Internal Revenue Code to allow a tax credit to small businesses for 35% of the expenses paid or incurred for providing qualified continuing financial education to their employees.