Patriot Bonus Tax Credit Act of 2020

To provide a payroll tax credit to employers for employee bonuses. 1. Short title This Act may be cited as the Patriot Bonus Tax Credit Act of 2020 2. Payroll tax credit to employers for employee bonuses (a) In general In the case of an employer, there shall be allowed as a credit against applicable employment taxes for each calendar quarter an amount equal to 50 percent of the qualified bonuses with respect to each employee of such employer for such calendar quarter. (b) Limitations and refundability (1) Bonuses taken into account The amount of qualified bonuses with respect to any employee which may be taken into account under subsection (a) by the employer for all calendar quarters shall not exceed $25,000. (2) Credit limited to employment taxes The credit allowed by subsection (a) with respect to any calendar quarter shall not exceed the applicable employment taxes (reduced by any credits allowed under subsections (e) and (f) of section 3111 (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 the 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) Qualified bonus The term qualified bonus (3) Secretary The term Secretary (4) Wages The term wages section 3121(a) (5) Other terms Any term used in this section which is also used in chapter 21 or 22 of the Internal Revenue Code of 1986 shall have the same meaning as when used in such chapter. (d) Certain rules To apply For purposes of this section, rules similar to the rules of sections 51(i)(1) and 280C(a) of the Internal Revenue Code of 1986 shall apply. (e) Certain governmental employers This credit shall not apply to the Government of the United States, the government of any State or political subdivision thereof, or any agency or instrumentality of any of the foregoing. (f) Election not To have section apply This section shall not apply with respect to any 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) Third-Party payors Any credit allowed under this section shall be treated as a credit described in section 3511(d)(2) of such Code. (h) Transfers to Federal Old-Age and Survivors Insurance Trust Fund 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. 14 (i) Treatment of deposits The Secretary shall waive any penalty under section 6656 (j) 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 advanced at the time of filing the return of tax for the applicable calendar quarter or taxable year; and (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 (k) Application This section shall only apply to qualified bonuses paid after March 12, 2020, and before January 1, 2021.

Summary: Patriot Bonus Tax Credit Act of 2020 This bill allows employers a employment tax credit for qualified bonuses paid to their employees after March 12, 2020, and before January 1, 2021. The credit is equal to 50% of such bonuses paid in a calendar quarter taking into account not more than $25,000 for any employee for all calendar quarters. The bill defines qualified bonus as wages paid to an employee that include overtime or hazardous pay, supplemental payments made for the convenience of the employer, payments to retain staff at essential facilities, or other payments made to employees due to extraordinary businesses and economic conditions.