RAISE Act of 2023

To amend the Internal Revenue Code of 1986 to provide an employer credit for increasing wages. 1. Short title This Act may be cited as the Rewarding American Investments to Support Employees Act of 2023 RAISE Act of 2023 2. Employer wage credit (a) In general Subpart D of part IV of subchapter A of chapter 1 45AA. Employer wage credit (a) In general For purposes of section 38, the employer wage credit determined under this section with respect to any employer for any taxable year is an amount equal to 10 percent of the excess (if any) of— (1) the aggregate amount of wages paid or incurred to specified employees during the calendar year which ends with or within such taxable year, over (2) the aggregate amount of wages paid or incurred to specified employees during the calendar year immediately preceding the calendar year described in paragraph (1). (b) Limitations (1) In general The amount of the credit determined under subsection (a) with respect to any employer for any taxable year shall not exceed $500,000. (2) Limitation on increase which may be taken into account with respect to each employee The amount of wages taken into account under subsection (a)(1) with respect to any employee shall not exceed the sum of $25,000 plus the amount of wages taken into account under subsection (a)(2) with respect to such employee. (c) Specified employees For purposes of this section, the term specified employee (1) was employed continuously in one or more trades or businesses of the employer during both calendar years described in subsection (a), and (2) earned wages not in excess of $75,000 during the calendar year described in subsection (a)(2). (d) Other definitions and special rules For purposes of this section— (1) Wages The term wages (2) Predecessor and successor Any reference in this paragraph to an employer shall include a reference to any predecessor of, or successor to, such employer. (3) Aggregation rule All persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 shall be treated as one employer. (4) Inflation adjustment (A) In general In the case of a taxable year beginning after 2024, the $500,000 and $75,000 amounts in subsections (b) and (c) shall each be increased by an amount equal— (i) such dollar amount, multiplied by (ii) the cost-of-living adjustment determined under subparagraph (B) for the calendar year in which the taxable year begins. (B) Cost-of-living adjustment For purposes of this paragraph, the cost-of-living adjustment for any calendar year is the percentage (if any) by which— (i) the CPI for the preceding calendar year, exceeds (ii) the CPI for calendar year 2023. (C) CPI for any calendar year For purposes of this paragraph, the CPI for any calendar year shall be determined as provided in section 1(f)(4). (D) Rounding If any amount as adjusted under subparagraph (A) is not a multiple of $1,000, such amount shall be rounded to the next lowest multiple of $1,000. (5) Election to have credit not apply A taxpayer may elect to have this section not apply for any taxable year. Rules similar to the rules of paragraphs (2) and (3) of section 51(j) shall apply for purposes of this paragraph. . (b) Credit To be part of general business credit Section 38(b) of such Code is amended by striking plus , plus (39) the employer wage credit determined under section 45AA. . (c) Denial of double benefit with deductions Section 280C(a) of such Code is amended by inserting 45AA(a), 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 the item: Sec. 45AA. Employer wage credit. . (e) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2023.

Summary: Rewarding American Investments to Support Employees Act of 2023 or the RAISE Act of 2023 This bill allows employers a tax credit for 10% of the excess of the aggregate amount of wages paid to specified employees (i.e., continuously-employed employees whose earned wages do not exceed $75,000 in a calendar year) in a taxable year, over the aggregate amount of wages paid to such employees during the immediately preceding calendar year. The amount of such credit may not exceed $500,000 for any employer in any taxable year.