451 
Internal Revenue Code of 1986 is amended by 
adding at the end the following new item: 
‘‘Sec. 6432. Continuation coverage premium assistance.’’. 
(C) EFFECTIVE DATE.—The amendments 
made by this paragraph shall apply to pre-
miums to which subsection (a)(1)(A) applies 
and wages paid on or after April 1, 2021. 
(D) SPECIAL RULE IN CASE OF EMPLOYEE 
PAYMENT THAT IS NOT REQUIRED UNDER THIS 
SECTION.— 
(i) IN GENERAL.—In the case of an 
assistance eligible individual who pays, 
with respect any period of coverage to 
which subsection (a)(1)(A) applies, the 
amount of the premium for such coverage 
that the individual would have (but for this 
Act) been required to pay, the person to 
whom such payment is payable shall reim-
burse such individual for the amount of 
such premium paid in excess of the 
amount required to be paid under sub-
section (a)(1)(A). 
(ii) CREDIT OF REIMBURSEMENT.—A 
person to which clause (i) applies shall be 
allowed a credit in the manner provided 
under section 6432 of the Internal Rev-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00451
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
452 
enue Code of 1986 for any payment made 
to the employee under such clause. 
(iii) PAYMENT
OF
CREDITS.—Any 
person to which clause (i) applies shall 
make the payment required under such 
clause to the individual not later than 60 
days after the date on which such indi-
vidual elects continuation coverage under 
subsection (a)(1). 
(2) PENALTY FOR FAILURE TO NOTIFY HEALTH 
PLAN OF CESSATION OF ELIGIBILITY FOR PREMIUM 
ASSISTANCE.— 
(A) IN GENERAL.—Part I of subchapter B 
of chapter 68 of the Internal Revenue Code of 
1986 is amended by adding at the end the fol-
lowing new section: 
‘‘SEC. 6720C. PENALTY FOR FAILURE TO NOTIFY HEALTH 
PLAN OF CESSATION OF ELIGIBILITY FOR 
CONTINUATION COVERAGE PREMIUM ASSIST-
ANCE. 
‘‘(a) IN GENERAL.—Except in the case of a failure 
described in subsection (b) or (c), any person required to 
notify a group health plan under section 9501(a)(2)(B) 
of the Worker Health Coverage Protection Act who fails 
to make such a notification at such time and in such man-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00452
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
453 
ner as the Secretary of Labor may require shall pay a 
penalty of $250 for each such failure. 
‘‘(b) INTENTIONAL FAILURE.—In the case of any 
such failure that is fraudulent, such person shall pay a 
penalty equal to the greater of— 
‘‘(1) $250, or 
‘‘(2) 110 percent of the premium assistance 
provided under section 9501(a)(1)(A) of the Worker 
Health Coverage Protection Act after termination of 
eligibility under such section. 
‘‘(c) REASONABLE CAUSE EXCEPTION.—No penalty 
shall be imposed under this section with respect to any 
failure if it is shown that such failure is due to reasonable 
cause and not to willful neglect.’’. 
(B) CLERICAL AMENDMENT.—The table of 
sections of part I of subchapter B of chapter 68 
of such Code is amended by adding at the end 
the following new item: 
‘‘Sec. 6720C. Penalty for failure to notify health plan of cessation of eligibility 
for continuation coverage premium assistance.’’. 
(3) COORDINATION WITH HCTC.— 
(A) IN GENERAL.—Section 35(g)(9) of the 
Internal Revenue Code of 1986 is amended to 
read as follows: 
‘‘(9) CONTINUATION COVERAGE PREMIUM AS-
SISTANCE.—In the case of an assistance eligible in-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00453
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
454 
dividual who receives premium assistance for con-
tinuation coverage under section 9501(a)(1) of the 
Worker Health Coverage Protection Act for any 
month during the taxable year, such individual shall 
not be treated as an eligible individual, a certified 
individual, or a qualifying family member for pur-
poses of this section or section 7527 with respect to 
such month.’’. 
(B) EFFECTIVE
DATE.—The amendment 
made by subparagraph (A) shall apply to tax-
able years ending after the date of the enact-
ment of this Act. 
(4) EXCLUSION OF CONTINUATION COVERAGE 
PREMIUM ASSISTANCE FROM GROSS INCOME.— 
(A) IN GENERAL.—Part III of subchapter 
B of chapter 1 of the Internal Revenue Code of 
1986 is amended by inserting after section 
139H the following new section: 
‘‘SEC. 139I. CONTINUATION COVERAGE PREMIUM ASSIST-
ANCE. 
‘‘In the case of an assistance eligible individual (as 
defined in subsection (a)(3) of section 9501 of the Worker 
Health Coverage Protection Act), gross income does not 
include any premium assistance provided under subsection 
(a)(1) of such section.’’. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00454
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
455 
(B) CLERICAL AMENDMENT.—The table of 
sections for part III of subchapter B of chapter 
1 of such Code is amended by inserting after 
the item relating to section 139H the following 
new item: 
‘‘Sec. 139I. Continuation coverage premium assistance.’’. 
(C) EFFECTIVE DATE.—The amendments 
made by this paragraph shall apply to taxable 
years ending after the date of the enactment of 
this Act. 
Subtitle G—Promoting Economic 
Security 
PART 1—2021 RECOVERY REBATES TO 
INDIVIDUALS 
SEC. 9601. 2021 RECOVERY REBATES TO INDIVIDUALS. 
(a) IN GENERAL.—Subchapter B of chapter 65 of the 
Internal Revenue Code of 1986 is amended by inserting 
after section 6428A the following new section: 
‘‘SEC. 6428B. 2021 RECOVERY REBATES TO INDIVIDUALS. 
‘‘(a) IN GENERAL.—In the case of an eligible indi-
vidual, there shall be allowed as a credit against the tax 
imposed by subtitle A for the first taxable year beginning 
in 2021 an amount equal to the 2021 rebate amount de-
termined for such taxable year. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00455
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
456 
‘‘(b) 2021 REBATE AMOUNT.—For purposes of this 
section, the term ‘2021 rebate amount’ means, with re-
spect to any taxpayer for any taxable year, the sum of— 
‘‘(1) $1,400 ($2,800 in the case of a joint re-
turn), plus 
‘‘(2) $1,400 multiplied by the number of de-
pendents of the taxpayer for such taxable year. 
‘‘(c) ELIGIBLE INDIVIDUAL.—For purposes of this 
section, the term ‘eligible individual’ means any individual 
other than— 
‘‘(1) any nonresident alien individual, 
‘‘(2) any individual who is a dependent of an-
other taxpayer for a taxable year beginning in the 
calendar year in which the individual’s taxable year 
begins, and 
‘‘(3) an estate or trust. 
‘‘(d) LIMITATION BASED ON ADJUSTED GROSS IN-
COME.— 
‘‘(1) IN GENERAL.—The amount of the credit 
allowed by subsection (a) (determined without re-
gard to this subsection and subsection (f)) shall be 
reduced (but not below zero) by the amount which 
bears the same ratio to such credit (as so deter-
mined) as— 
‘‘(A) the excess of— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00456
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
457 
‘‘(i) the taxpayer’s adjusted gross in-
come for such taxable year, over 
‘‘(ii) $75,000, bears to 
‘‘(B) $25,000. 
‘‘(2) SPECIAL RULES.— 
‘‘(A) 
JOINT
RETURN
OR
SURVIVING 
SPOUSE.—In the case of a joint return or a sur-
viving spouse (as defined in section 2(a)), para-
graph (1) shall be applied by substituting 
‘$150,000’ for ‘$75,000’ and ‘$50,000’ for 
‘$25,000’. 
‘‘(B) HEAD OF HOUSEHOLD.—In the case 
of a head of household (as defined in section 
2(b)), paragraph (1) shall be applied by sub-
stituting 
‘$112,500’ 
for 
‘$75,000’ 
and 
‘$37,500’ for ‘$25,000’. 
‘‘(e) DEFINITIONS AND SPECIAL RULES.— 
‘‘(1) DEPENDENT DEFINED.—For purposes of 
this section, the term ‘dependent’ has the meaning 
given such term by section 152. 
‘‘(2) 
IDENTIFICATION
NUMBER
REQUIRE-
MENT.— 
‘‘(A) IN GENERAL.—In the case of a re-
turn other than a joint return, the $1,400 
amount in subsection (b)(1) shall be treated as 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00457
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
458 
being zero unless the taxpayer includes the 
valid identification number of the taxpayer on 
the return of tax for the taxable year. 
‘‘(B) JOINT RETURNS.—In the case of a 
joint return, the $2,800 amount in subsection 
(b)(1) shall be treated as being— 
‘‘(i) $1,400 if the valid identification 
number of only 1 spouse is included on the 
return of tax for the taxable year, and 
‘‘(ii) zero if the valid identification 
number of neither spouse is so included. 
‘‘(C) DEPENDENTS.—A dependent shall 
not be taken into account under subsection 
(b)(2) unless the valid identification number of 
such dependent is included on the return of tax 
for the taxable year. 
‘‘(D) VALID IDENTIFICATION NUMBER.— 
‘‘(i) IN
GENERAL.—For purposes of 
this paragraph, the term ‘valid identifica-
tion number’ means a social security num-
ber issued to an individual by the Social 
Security Administration on or before the 
due date for filing the return for the tax-
able year. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00458
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
459 
‘‘(ii) ADOPTION
TAXPAYER
IDENTI-
FICATION NUMBER.—For purposes of sub-
paragraph (C), in the case of a dependent 
who is adopted or placed for adoption, the 
term ‘valid identification number’ shall in-
clude the adoption taxpayer identification 
number of such dependent. 
‘‘(E) SPECIAL
RULE
FOR
MEMBERS
OF 
THE ARMED FORCES.—Subparagraph (B) shall 
not apply in the case where at least 1 spouse 
was a member of the Armed Forces of the 
United States at any time during the taxable 
year and the valid identification number of at 
least 1 spouse is included on the return of tax 
for the taxable year. 
‘‘(F) COORDINATION
WITH
CERTAIN
AD-
VANCE PAYMENTS.—In the case of any payment 
determined pursuant to subsection (g)(6), a 
valid identification number shall be treated for 
purposes of this paragraph as included on the 
taxpayer’s return of tax if such valid identifica-
tion number is available to the Secretary as de-
scribed in such subsection. 
‘‘(G) MATHEMATICAL OR CLERICAL ERROR 
AUTHORITY.—Any omission of a correct valid 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00459
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
460 
identification number required under this para-
graph shall be treated as a mathematical or 
clerical error for purposes of applying section 
6213(g)(2) to such omission. 
‘‘(3) CREDIT TREATED AS REFUNDABLE.—The 
credit allowed by subsection (a) shall be treated as 
allowed by subpart C of part IV of subchapter A of 
chapter 1. 
‘‘(f) COORDINATION WITH ADVANCE REFUNDS OF 
CREDIT.— 
‘‘(1) REDUCTION OF REFUNDABLE CREDIT.— 
The amount of the credit which would (but for this 
paragraph) be allowable under subsection (a) shall 
be reduced (but not below zero) by the aggregate re-
funds and credits made or allowed to the taxpayer 
(or, except as otherwise provided by the Secretary, 
any dependent of the taxpayer) under subsection (g). 
Any failure to so reduce the credit shall be treated 
as arising out of a mathematical or clerical error 
and assessed according to section 6213(b)(1). 
‘‘(2) JOINT
RETURNS.—Except as otherwise 
provided by the Secretary, in the case of a refund 
or credit made or allowed under subsection (g) with 
respect to a joint return, half of such refund or cred-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00460
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
461 
it shall be treated as having been made or allowed 
to each individual filing such return. 
‘‘(g) ADVANCE REFUNDS AND CREDITS.— 
‘‘(1) IN GENERAL.—Subject to paragraphs (5) 
and (6), each individual who was an eligible indi-
vidual for such individual’s first taxable year begin-
ning in 2019 shall be treated as having made a pay-
ment against the tax imposed by chapter 1 for such 
taxable year in an amount equal to the advance re-
fund amount for such taxable year. 
‘‘(2) ADVANCE REFUND AMOUNT.— 
‘‘(A) IN GENERAL.—For purposes of para-
graph (1), the advance refund amount is the 
amount that would have been allowed as a cred-
it under this section for such taxable year if 
this section (other than subsection (f) and this 
subsection) had applied to such taxable year. 
‘‘(B) TREATMENT OF DECEASED INDIVID-
UALS.—For purposes of determining the ad-
vance refund amount with respect to such tax-
able year— 
‘‘(i) any individual who was deceased 
before January 1, 2021, shall be treated 
for purposes of applying subsection (e)(2) 
in the same manner as if the valid identi-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00461
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
462 
fication number of such person was not in-
cluded on the return of tax for such tax-
able year (except that subparagraph (E) 
thereof shall not apply), 
‘‘(ii) notwithstanding clause (i), in the 
case of a joint return with respect to which 
only 1 spouse is deceased before January 
1, 2021, such deceased spouse was a mem-
ber of the Armed Forces of the United 
States at any time during the taxable year, 
and the valid identification number of such 
deceased spouse is included on the return 
of tax for the taxable year, the valid identi-
fication number of 1 (and only 1) spouse 
shall be treated as included on the return 
of tax for the taxable year for purposes of 
applying subsection (e)(2)(B) with respect 
to such joint return, and 
‘‘(iii) no amount shall be determined 
under subsection (e)(2) with respect to any 
dependent of the taxpayer if the taxpayer 
(both spouses in the case of a joint return) 
was deceased before January 1, 2021. 
‘‘(3) TIMING AND MANNER OF PAYMENTS.— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00462
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
463 
‘‘(A) TIMING.—The Secretary shall, sub-
ject to the provisions of this title, refund or 
credit any overpayment attributable to this sub-
section as rapidly as possible, consistent with a 
rapid effort to make payments attributable to 
such overpayments electronically if appropriate. 
No refund or credit shall be made or allowed 
under this subsection after December 31, 2021. 
‘‘(B) DELIVERY OF PAYMENTS.—Notwith-
standing any other provision of law, the Sec-
retary may certify and disburse refunds payable 
under this subsection electronically to— 
‘‘(i) any account to which the payee 
received or authorized, on or after January 
1, 2019, a refund of taxes under this title 
or of a Federal payment (as defined in sec-
tion 3332 of title 31, United States Code), 
‘‘(ii) any account belonging to a payee 
from which that individual, on or after 
January 1, 2019, made a payment of taxes 
under this title, or 
‘‘(iii) any Treasury-sponsored account 
(as defined in section 208.2 of title 31, 
Code of Federal Regulations). 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00463
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
464 
‘‘(C) WAIVER OF CERTAIN RULES.—Not-
withstanding section 3325 of title 31, United 
States Code, or any other provision of law, with 
respect to any payment of a refund under this 
subsection, a disbursing official in the executive 
branch of the United States Government may 
modify payment information received from an 
officer 
or 
employee 
described 
in 
section 
3325(a)(1)(B) of such title for the purpose of 
facilitating the accurate and efficient delivery of 
such payment. Except in cases of fraud or reck-
less neglect, no liability under section 3325, 
3527, 3528, or 3529 of title 31, United States 
Code, shall be imposed with respect to pay-
ments made under this subparagraph. 
‘‘(4) NO INTEREST.—No interest shall be al-
lowed on any overpayment attributable to this sub-
section. 
‘‘(5) APPLICATION TO INDIVIDUALS WHO HAVE 
FILED A RETURN OF TAX FOR 2020.— 
‘‘(A) APPLICATION
TO
2020
RETURNS 
FILED AT TIME OF INITIAL DETERMINATION.— 
If, at the time of any determination made pur-
suant to paragraph (3), the individual referred 
to in paragraph (1) has filed a return of tax for 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00464
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
465 
the individual’s first taxable year beginning in 
2020, paragraph (1) shall be applied with re-
spect to such individual by substituting ‘2020’ 
for ‘2019’. 
‘‘(B) ADDITIONAL PAYMENT.— 
‘‘(i) IN GENERAL.—In the case of any 
individual who files, before the additional 
payment determination date, a return of 
tax for such individual’s first taxable year 
beginning in 2020, the Secretary shall 
make a payment (in addition to any pay-
ment made under paragraph (1)) to such 
individual equal to the excess (if any) of— 
‘‘(I) the amount which would be 
determined 
under 
paragraph 
(1) 
(after the application of subparagraph 
(A)) by applying paragraph (1) as of 
the additional payment determination 
date, over 
‘‘(II) the amount of any payment 
made with respect to such individual 
under paragraph (1). 
‘‘(ii) ADDITIONAL
PAYMENT
DETER-
MINATION
DATE.—The term ‘additional 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00465
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
466 
payment determination date’ means the 
earlier of— 
‘‘(I) the date which is 90 days 
after the 2020 calendar year filing 
deadline, or 
‘‘(II) September 1, 2021. 
‘‘(iii) 2020 CALENDAR
YEAR
FILING 
DEADLINE.—The term ‘2020 calendar year 
filing deadline’ means the date specified in 
section 6072(a) with respect to returns for 
calendar year 2020. Such date shall be de-
termined after taking into account any pe-
riod disregarded under section 7508A if 
such disregard applies to substantially all 
returns for calendar year 2020 to which 
section 6072(a) applies. 
‘‘(6) APPLICATION
TO
CERTAIN
INDIVIDUALS 
WHO HAVE NOT FILED A RETURN OF TAX FOR 2019 
OR 2020 AT TIME OF DETERMINATION.— 
‘‘(A) IN GENERAL.—In the case of any in-
dividual who, at the time of any determination 
made pursuant to paragraph (3), has filed a tax 
return for neither the year described in para-
graph (1) nor for the year described in para-
graph (5)(A), the Secretary may apply para-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00466
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
467 
graph (1) on the basis of information available 
to the Secretary and, on the basis of such infor-
mation, may determine the advance refund 
amount with respect to such individual without 
regard to subsection (d). 
‘‘(B) PAYMENT TO REPRESENTATIVE PAY-
EES
AND
FIDUCIARIES.—In the case of any 
payment determined pursuant to subparagraph 
(A), such payment may be made to an indi-
vidual or organization serving as the eligible in-
dividual’s representative payee or fiduciary for 
a federal benefit program and the entire 
amount of such payment so made shall be used 
only for the benefit of the individual who is en-
titled to the payment. 
‘‘(7) SPECIAL RULE RELATED TO TIME OF FIL-
ING
RETURN.—Solely for purposes of this sub-
section, a return of tax shall not be treated as filed 
until such return has been processed by the Internal 
Revenue Service. 
‘‘(8) NOTICE TO TAXPAYER.—As soon as prac-
ticable after the date on which the Secretary distrib-
uted any payment to an eligible taxpayer pursuant 
to this subsection, notice shall be sent by mail to 
such taxpayer’s last known address. Such notice 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00467
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
468 
shall indicate the method by which such payment 
was made, the amount of such payment, a phone 
number for an appropriate point of contact at the 
Internal Revenue Service to report any error with 
respect to such payment, and such other information 
as the Secretary determines appropriate. 
‘‘(9) RESTRICTION ON USE OF CERTAIN PRE-
VIOUSLY ISSUED PREPAID DEBIT CARDS.—Payments 
made by the Secretary to individuals under this sec-
tion shall not be in the form of an increase in the 
balance of any previously issued prepaid debit card 
if, as of the time of the issuance of such card, such 
card was issued solely for purposes of making pay-
ments under section 6428 or 6428A. 
‘‘(h) REGULATIONS.—The Secretary shall prescribe 
such regulations or other guidance as may be necessary 
or appropriate to carry out the purposes of this section, 
including— 
‘‘(1) regulations or other guidance providing 
taxpayers the opportunity to provide the Secretary 
information sufficient to allow the Secretary to make 
payments to such taxpayers under subsection (g) 
(including the determination of the amount of such 
payment) if such information is not otherwise avail-
able to the Secretary, and 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00468
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
469 
‘‘(2) regulations or other guidance to ensure to 
the maximum extent administratively practicable 
that, in determining the amount of any credit under 
subsection (a) and any credit or refund under sub-
section (g), an individual is not taken into account 
more than once, including by different taxpayers and 
including by reason of a change in joint return sta-
tus or dependent status between the taxable year for 
which an advance refund amount is determined and 
the taxable year for which a credit under subsection 
(a) is determined. 
‘‘(i) OUTREACH.—The Secretary shall carry out a ro-
bust and comprehensive outreach program to ensure that 
all taxpayers described in subsection (h)(1) learn of their 
eligibility for the advance refunds and credits under sub-
section (g); are advised of the opportunity to receive such 
advance refunds and credits as provided under subsection 
(h)(1); and are provided assistance in applying for such 
advance refunds and credits. In conducting such outreach 
program, the Secretary shall coordinate with other govern-
ment, State, and local agencies; federal partners; and com-
munity-based nonprofit organizations that regularly inter-
face with such taxpayers.’’. 
(b) TREATMENT OF CERTAIN POSSESSIONS.— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00469
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
470 
(1) PAYMENTS TO POSSESSIONS WITH MIRROR 
CODE TAX SYSTEMS.—The Secretary of the Treas-
ury shall pay to each possession of the United States 
which has a mirror code tax system amounts equal 
to the loss (if any) to that possession by reason of 
the amendments made by this section. Such 
amounts shall be determined by the Secretary of the 
Treasury based on information provided by the gov-
ernment of the respective possession. 
(2) PAYMENTS TO OTHER POSSESSIONS.—The 
Secretary of the Treasury shall pay to each posses-
sion of the United States which does not have a mir-
ror code tax system amounts estimated by the Sec-
retary of the Treasury as being equal to the aggre-
gate benefits (if any) that would have been provided 
to residents of such possession by reason of the 
amendments made by this section if a mirror code 
tax system had been in effect in such possession. 
The preceding sentence shall not apply unless the re-
spective possession has a plan, which has been ap-
proved by the Secretary of the Treasury, under 
which such possession will promptly distribute such 
payments to its residents. 
(3) 
INCLUSION
OF
ADMINISTRATIVE
EX-
PENSES.—The Secretary of the Treasury shall pay 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00470
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
471 
to each possession of the United States to which the 
Secretary makes a payment under paragraph (1) or 
(2) an amount equal to the lesser of— 
(A) the increase (if any) of the administra-
tive expenses of such possession— 
(i) in the case of a possession de-
scribed in paragraph (1), by reason of the 
amendments made by this section, and 
(ii) in the case of a possession de-
scribed in paragraph (2), by reason of car-
rying out the plan described in such para-
graph, or 
(B) $500,000 ($10,000,000 in the case of 
Puerto Rico). 
The amount described in subparagraph (A) shall be 
determined by the Secretary of the Treasury based 
on information provided by the government of the 
respective possession. 
(4) COORDINATION
WITH
CREDIT
ALLOWED 
AGAINST UNITED STATES INCOME TAXES.—No cred-
it shall be allowed against United States income 
taxes under section 6428B of the Internal Revenue 
Code of 1986 (as added by this section), nor shall 
any credit or refund be made or allowed under sub-
section (g) of such section, to any person— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00471
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
472 
(A) to whom a credit is allowed against 
taxes imposed by the possession by reason of 
the amendments made by this section, or 
(B) who is eligible for a payment under a 
plan described in paragraph (2). 
(5) MIRROR CODE TAX SYSTEM.—For purposes 
of this subsection, the term ‘‘mirror code tax sys-
tem’’ means, with respect to any possession of the 
United States, the income tax system of such posses-
sion if the income tax liability of the residents of 
such possession under such system is determined by 
reference to the income tax laws of the United 
States as if such possession were the United States. 
(6) TREATMENT OF PAYMENTS.—For purposes 
of section 1324 of title 31, United States Code, the 
payments under this subsection shall be treated in 
the same manner as a refund due from a credit pro-
vision referred to in subsection (b)(2) of such sec-
tion. 
(c) ADMINISTRATIVE PROVISIONS.— 
(1) 
DEFINITION
OF
DEFICIENCY.—Section 
6211(b)(4)(A) of the Internal Revenue Code of 1986 
is amended by striking ‘‘6428, and 6428A’’ and in-
serting ‘‘6428, 6428A, and 6428B’’. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00472
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
473 
(2) EXCEPTION
FROM
REDUCTION
OR
OFF-
SET.—Any refund payable by reason of section 
6428B(g) of the Internal Revenue Code of 1986 (as 
added by this section), or any such refund payable 
by reason of subsection (b) of this section, shall not 
be — 
(A) subject to reduction or offset pursuant 
to section 3716 or 3720A of title 31, United 
States Code, 
(B) subject to reduction or offset pursuant 
to subsection (c), (d), (e), or (f) of section 6402 
of the Internal Revenue Code of 1986, or 
(C) reduced or offset by other assessed 
Federal taxes that would otherwise be subject 
to levy or collection. 
(3) CONFORMING AMENDMENTS.— 
(A) Paragraph (2) of section 1324(b) of 
title 31, United States Code, is amended by in-
serting ‘‘6428B,’’ after ‘‘6428A,’’. 
(B) The table of sections for subchapter B 
of chapter 65 of the Internal Revenue Code of 
1986 is amended by inserting after the item re-
lating to section 6428A the following new item: 
‘‘Sec. 6428B. 2021 recovery rebates to individuals.’’. 
(d) APPROPRIATIONS.—Immediately upon the enact-
ment of this Act, in addition to amounts otherwise avail-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00473
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
474 
able, there are appropriated for fiscal year 2021, out of 
any money in the Treasury not otherwise appropriated: 
(1) $1,464,500,000 to remain available until 
September 30, 2023 for necessary expenses for the 
Internal Revenue Service for the administration of 
the advance payments, the provision of taxpayer as-
sistance, and the furtherance of integrated, modern-
ized, and secure Internal Revenue Service systems, 
which shall supplement and not supplant any other 
appropriations that may be available for this pur-
pose. 
(2) $7,000,000 to remain available until Sep-
tember 30, 2022, for necessary expenses for the Bu-
reau of the Fiscal Service to carry out this section 
(and the amendments made by this section), which 
shall supplement and not supplant any other appro-
priations that may be available for this purpose, and 
(3) $8,000,000 to remain available until Sep-
tember 30, 2023, for the Treasury Inspector General 
for Tax Administration for the purposes of over-
seeing activates related to the administration of this 
section (and the amendments made by this section), 
which shall supplement and not supplant any other 
appropriations that may be available for this pur-
pose. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00474
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
475 
(e) FLEXIBILITY WITH RESPECT TO IRS INFORMA-
TION TECHNOLOGY EMPLOYEES.— 
(1) If services performed by an employee of the 
Internal Revenue Service during the period begin-
ning on January 1, 2020, and ending on December 
31, 2022, are determined by the Commissioner of 
Internal Revenue to be primarily related to informa-
tion technology, any premium pay for such services 
shall be disregarded in calculating the aggregate of 
such employee’s basic pay and premium pay for pur-
poses of a limitation under section 5547(a) of title 
5, United States Code, or under any other provision 
of law, whether such employee’s pay is paid on a bi-
weekly or calendar year basis. 
(2) Any overtime pay for such services shall be 
disregarded in calculating any annual limit on the 
amount of overtime pay payable in a calendar or fis-
cal year. 
(3) With regard to such services, any pay that 
is disregarded under either paragraph (1) or (2) 
shall be disregarded in calculating such employees 
aggregate pay for purposes of the limitations in sec-
tions 5307 and 9502 of such title 5. 
(4) If application of this subsection results in 
the payment of additional premium pay to a covered 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00475
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
476 
employee of a type that is normally creditable as 
basic pay for retirement or any other purpose, that 
additional pay shall not— 
(A) be considered to be basic pay of the 
covered employee for any purpose; or 
(B) be used in computing a lump-sum pay-
ment to the covered employee for accumulated 
and accrued annual leave under section 5551 or 
section 5552 of such title 5. 
PART 2—CHILD TAX CREDIT 
SEC. 9611. CHILD TAX CREDIT IMPROVEMENTS FOR 2021. 
(a) IN GENERAL.—Section 24 of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following new subsection: 
‘‘(i) SPECIAL RULES FOR 2021.—In the case of any 
taxable year beginning after December 31, 2020, and be-
fore January 1, 2022— 
‘‘(1) REFUNDABLE
CREDIT.—If the taxpayer 
(in the case of a joint return, either spouse) has a 
principal place of abode in the United States (deter-
mined as provided in section 32) for more than one- 
half of the taxable year or is a bona fide resident of 
Puerto Rico (within the meaning of section 937(a)) 
for such taxable year— 
‘‘(A) subsection (d) shall not apply, and 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00476
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
477 
‘‘(B) so much of the credit determined 
under subsection (a) (after application of sub-
paragraph (A)) as does not exceed the amount 
of such credit which would be so determined 
without regard to subsection (h)(4) shall be al-
lowed under subpart C (and not allowed under 
this subpart). 
‘‘(2) 17-YEAR-OLDS ELIGIBLE FOR TREATMENT 
AS QUALIFYING CHILDREN.—This section shall be 
applied— 
‘‘(A) by substituting ‘age 18’ for ‘age 17’ 
in subsection (c)(1), and 
‘‘(B) by substituting ‘described in sub-
section (c) (determined after the application of 
subsection (i)(2)(A))’ for ‘described in sub-
section (c)’ in subsection (h)(4)(A). 
‘‘(3) CREDIT AMOUNT.—Subsection (h)(2) shall 
not apply and subsection (a) shall be applied by sub-
stituting ‘$3,000 ($3,600 in the case of a qualifying 
child who has not attained age 6 as of the close of 
the calendar year in which the taxable year of the 
taxpayer begins)’ for ‘$1,000’. 
‘‘(4) 
REDUCTION
OF
INCREASED
CREDIT 
AMOUNT BASED ON MODIFIED ADJUSTED GROSS IN-
COME.— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00477
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
478 
‘‘(A) IN
GENERAL.—The amount of the 
credit allowable under subsection (a) (deter-
mined without regard to subsection (b)) shall be 
reduced by $50 for each $1,000 (or fraction 
thereof) by which the taxpayer’s modified ad-
justed gross income (as defined in subsection 
(b)) exceeds the applicable threshold amount. 
‘‘(B) APPLICABLE THRESHOLD AMOUNT.— 
For purposes of this paragraph, the term ‘ap-
plicable threshold amount’ means— 
‘‘(i) $150,000, in the case of a joint 
return or surviving spouse (as defined in 
section 2(a)) , 
‘‘(ii) $112,500, in the case of a head 
of household (as defined in section 2(b)), 
and 
‘‘(iii) $75,000, in any other case. 
‘‘(C) LIMITATION ON REDUCTION.— 
‘‘(i) IN
GENERAL.—The amount of 
the reduction under subparagraph (A) 
shall not exceed the lesser of— 
‘‘(I) the applicable credit increase 
amount, or 
‘‘(II) 5 percent of the applicable 
phaseout threshold range. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00478
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
479 
‘‘(ii) APPLICABLE
CREDIT
INCREASE 
AMOUNT.—For purposes of this subpara-
graph, the term ‘applicable credit increase 
amount’ means the excess (if any) of— 
‘‘(I) the amount of the credit al-
lowable under this section for the tax-
able year determined without regard 
to this paragraph and subsection (b), 
over 
‘‘(II) the amount of such credit 
as so determined and without regard 
to paragraph (3). 
‘‘(iii) 
APPLICABLE
PHASEOUT 
THRESHOLD RANGE.—For purposes of this 
subparagraph, the term ‘applicable phase-
out threshold range’ means the excess of— 
‘‘(I) the threshold amount appli-
cable to the taxpayer under subsection 
(b) (determined after the application 
of subsection (h)(3)), over 
‘‘(II) the applicable threshold 
amount applicable to the taxpayer 
under this paragraph. 
‘‘(D) COORDINATION WITH LIMITATION ON 
OVERALL CREDIT.—Subsection (b) shall be ap-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00479
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
480 
plied by substituting ‘the credit allowable under 
subsection (a) (determined after the application 
of subsection (i)(4)(A)’ for ‘the credit allowable 
under subsection (a)’.’’. 
(b) ADVANCE PAYMENT OF CREDIT.— 
(1) IN GENERAL.—Chapter 77 of such Code is 
amended by inserting after section 7527 the fol-
lowing new section: 
‘‘SEC. 7527A. ADVANCE PAYMENT OF CHILD TAX CREDIT. 
‘‘(a) IN GENERAL.—The Secretary shall establish a 
program for making monthly payments to taxpayers each 
of which is equal to 1⁄12 of the annual advance amount 
determined with respect to such taxpayer for the calendar 
year. 
‘‘(b) ANNUAL ADVANCE AMOUNT.—For purposes of 
this section— 
‘‘(1) IN GENERAL.—Except as otherwise pro-
vided in this subsection, the term ‘annual advance 
amount’ means, with respect to any taxpayer for any 
calendar year, the amount (if any) which is esti-
mated by the Secretary as being equal to the 
amount which would be treated as allowed under 
subpart C of part IV of subchapter A of chapter 1 
by reason of section 24(i)(1) for the taxpayer’s tax-
able year beginning in such calendar year if— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00480
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
482 
‘‘(3) 
MODIFICATIONS
DURING
CALENDAR 
YEAR.— 
‘‘(A) IN
GENERAL.—The Secretary may 
modify, during any calendar year, the annual 
advance amount with respect to any taxpayer 
for such calendar year to take into account— 
‘‘(i) a return of tax filed by such tax-
payer during such calendar year (and the 
taxable year to which such return relates 
may be taken into account as the reference 
taxable year), and 
‘‘(ii) any other information provided 
by the taxpayer to the Secretary which al-
lows the Secretary to determine payments 
under subsection (a) which, in the aggre-
gate during any taxable year of the tax-
payer, more closely total the Secretary’s 
estimate of the amount treated as allowed 
under subpart C of part IV of subchapter 
A of chapter 1 by reason of section 
24(i)(1) for such taxable year of such tax-
payer. 
‘‘(B) ADJUSTMENT TO REFLECT EXCESS 
OR DEFICIT IN PRIOR PAYMENTS.—In the case 
of any modification of the annual advance 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00482
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
483 
amount under subparagraph (A), the Secretary 
may adjust the amount of any monthly pay-
ment made after the date of such modification 
to properly take into account the amount by 
which any monthly payment made before such 
date was greater than or less than the amount 
that such payment would have been on the 
basis of the annual advance amount as so modi-
fied. 
‘‘(4) DETERMINATION OF STATUS.—If informa-
tion contained in the taxpayer’s return of tax for the 
reference taxable year does not establish the status 
of the taxpayer as being described in section 
24(i)(1), the Secretary may, for purposes of para-
graph (1)(A), infer such status (or the lack thereof) 
from such information as is so contained or from 
other sources. 
‘‘(5) TREATMENT
OF
CERTAIN
DEATHS.—A 
child shall not be taken into account in determining 
the annual advance amount under paragraph (1) if 
the death of such child is known to the Secretary as 
of the beginning of the calendar year for which the 
estimate under such paragraph is made. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00483
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
484 
‘‘(c) ON-LINE INFORMATION PORTAL.—The Sec-
retary shall establish an on-line portal which allows tax-
payers to— 
‘‘(1) elect not to receive payments under this 
section, and 
‘‘(2) provide information to the Secretary which 
would be relevant to a modification under subsection 
(b)(3)(B) of the annual advance amount, including 
information regarding— 
‘‘(A) a change in the number of the tax-
payer’s qualifying children, including by reason 
of the birth of a child, 
‘‘(B) a change in the taxpayer’s marital 
status, 
‘‘(C) a significant change in the taxpayer’s 
income, and 
‘‘(D) any other factor which the Secretary 
may provide. 
‘‘(d) NOTICE OF PAYMENTS.—Not later than Janu-
ary 31 of the calendar year following any calendar year 
during which the Secretary makes one or more payments 
to any taxpayer under this section, the Secretary shall pro-
vide such taxpayer with a written notice which includes 
the taxpayer’s taxpayer identity (as defined in section 
6103(b)(6)), the aggregate amount of such payments 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00484
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
485 
made to such taxpayer during such calendar year, and 
such other information as the Secretary determines appro-
priate. 
‘‘(e) AUTHORITY
TO ADJUST INTERVAL
OF PAY-
MENTS.—If the Secretary determines that it is not admin-
istratively feasible to make monthly payments under this 
section— 
‘‘(1) such payments shall be made on the basis 
of the shortest interval which the Secretary deter-
mines is administratively feasible, and 
‘‘(2) the amount of such payments shall be de-
termined by substituting the ratio of the length of 
such interval to the length of the calendar year for 
‘1⁄12’ in subsection (a). 
‘‘(f) ADMINISTRATIVE PROVISIONS.— 
‘‘(1) APPLICATION
OF
DIRECT
DEPOSIT
RE-
QUIREMENT.—Solely for purposes of section 3332 of 
title 31, United States Code (and notwithstanding 
the last sentence of subsection (j)(3) thereof), the 
payments made by the Secretary under subsection 
(a) shall be treated as Federal payments. 
‘‘(2) 
DELIVERY
OF
PAYMENTS.—Notwith-
standing any other provision of law, the Secretary 
may certify and disburse refunds payable under this 
section electronically to— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00485
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
486 
‘‘(A) any account to which the payee re-
ceived or authorized, on or after January 1, 
2019, a refund of taxes under this title or a 
Federal payment (as defined in section 3332 of 
title 31, United States Code), 
‘‘(B) any account belonging to a payee 
from which that individual, on or after January 
1, 2019, made a payment of taxes under this 
title, or 
‘‘(C) any Treasury-sponsored account (as 
defined in section 208.2 of title 31, Code of 
Federal Regulations). 
‘‘(3) WAIVER
OF
CERTAIN
RULES.—Notwith-
standing section 3325 of title 31, United States 
Code, or any other provision of law, with respect to 
any payment of a refund under this section, a dis-
bursing official in the executive branch of the United 
States Government may modify payment information 
received from an officer or employee described in 
section 3325(a)(1)(B) of such title for the purpose 
of facilitating the accurate and efficient delivery of 
such payment. Except in cases of fraud or reckless 
neglect, no liability under section 3325, 3527, 3528, 
or 3529 of title 31, United States Code, shall be im-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00486
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
487 
posed with respect to payments made under this 
paragraph. 
‘‘(4) EXCEPTION
FROM
REDUCTION
OR
OFF-
SET.—Any payment made to any individual under 
this section shall not be— 
‘‘(A) subject to reduction or offset pursu-
ant to section 3716 or 3720A of title 31, 
United States Code, 
‘‘(B) subject to reduction or offset pursu-
ant to subsection (c), (d), (e), or (f) of section 
6402, or 
‘‘(C) reduced or offset by other assessed 
Federal taxes that would otherwise be subject 
to levy or collection. 
‘‘(5) ADVANCE PAYMENTS NOT APPLICABLE TO 
POSSESSIONS OF THE UNITED STATES.— 
‘‘(A) IN GENERAL.—The advance payment 
amount determined under this section shall be 
determined— 
‘‘(i) by applying section 24(i)(1) with-
out regard to the phrase ‘or is a bona fide 
resident of Puerto Rico (within the mean-
ing of section 937(a))’, and 
‘‘(ii) 
without 
regard 
to 
section 
24(k)(3)(C)(ii)(I). 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00487
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
488 
‘‘(B) MIRROR CODE POSSESSIONS.—In the 
case of any possession of the United States with 
a mirror code tax system (as defined in section 
24(k)), this section shall not be treated as part 
of the income tax laws of the United States for 
purposes of determining the income tax law of 
such possession. 
‘‘(g) APPLICATION.—No payments shall be made 
under the program established under subsection (a) with 
respect to— 
‘‘(1) any month beginning before July 1, 2021, 
or 
‘‘(2) any month beginning after December 31, 
2021. 
‘‘(h) REGULATIONS.—The Secretary shall issue such 
regulations or other guidance as the Secretary determines 
necessary or appropriate to carry out the purposes of this 
section and subsections (i)(1) and (j) of section 24, includ-
ing regulations or other guidance which provides for the 
application of such provisions where the filing status of 
the taxpayer for a taxable year is different from the status 
used for determining the annual advance amount.’’. 
(2) RECONCILIATION OF CREDIT AND ADVANCE 
CREDIT.—Section 24 of such Code, as amended by 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00488
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
489 
the preceding provision of this Act, is amended by 
adding at the end the following new subsection: 
‘‘(j) RECONCILIATION
OF CREDIT
AND ADVANCE 
CREDIT.— 
‘‘(1) IN GENERAL.—The amount of the credit 
allowed under this section to any taxpayer for any 
taxable year shall be reduced (but not below zero) by 
the aggregate amount of payments made under sec-
tion 7527A to such taxpayer during such taxable 
year. Any failure to so reduce the credit shall be 
treated as arising out of a mathematical or clerical 
error and assessed according to section 6213(b)(1). 
‘‘(2) EXCESS ADVANCE PAYMENTS.— 
‘‘(A) IN
GENERAL.—If the aggregate 
amount of payments under section 7527A to 
the taxpayer during the taxable year exceeds 
the amount of the credit allowed under this sec-
tion to such taxpayer for such taxable year (de-
termined without regard to paragraph (1)), the 
tax imposed by this chapter for such taxable 
year shall be increased by the amount of such 
excess. Any failure to so increase the tax shall 
be treated as arising out of a mathematical or 
clerical error and assessed according to section 
6213(b)(1). 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00489
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
490 
‘‘(B) SAFE HARBOR BASED ON MODIFIED 
ADJUSTED GROSS INCOME.— 
‘‘(i) IN GENERAL.—In the case of a 
taxpayer whose modified adjusted gross in-
come (as defined in subsection (b)) for the 
taxable year does not exceed 200 percent 
of the applicable income threshold, the 
amount of the increase determined under 
subparagraph (A) with respect to such tax-
payer for such taxable year shall be re-
duced (but not below zero) by the safe har-
bor amount. 
‘‘(ii) PHASE
OUT
OF
SAFE
HARBOR 
AMOUNT.—In the case of a taxpayer whose 
modified adjusted gross income (as defined 
in subsection (b)) for the taxable year ex-
ceeds the applicable income threshold, the 
safe harbor amount otherwise in effect 
under clause (i) shall be reduced by the 
amount which bears the same ratio to such 
amount as such excess bears to the appli-
cable income threshold. 
‘‘(iii) APPLICABLE
INCOME
THRESH-
OLD.—For purposes of this subparagraph, 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00490
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
491 
the term ‘applicable income threshold’ 
means— 
‘‘(I) $60,000 in the case of a 
joint return or surviving spouse (as 
defined in section 2(a)), 
‘‘(II) $50,000 in the case of a 
head of household, and 
‘‘(III) $40,000 in any other case. 
‘‘(iv) SAFE
HARBOR
AMOUNT.—For 
purposes of this subparagraph, the term 
‘safe harbor amount’ means, with respect 
to any taxable year, the product of— 
‘‘(I) $2,000, multiplied by 
‘‘(II) the excess (if any) of the 
number of qualified children taken 
into account in determining the an-
nual advance amount with respect to 
the taxpayer under section 7527A 
with respect to months beginning in 
such taxable year, over the number of 
qualified children taken into account 
in determining the credit allowed 
under this section for such taxable 
year.’’. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00491
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
492 
(3) 
COORDINATION
WITH
WAGE
WITH-
HOLDING.—Section 3402(f)(1)(C) of such Code is 
amended by striking ‘‘section 24(a)’’ and inserting 
‘‘section 24 (determined after application of sub-
section (j) thereof)’’. 
(4) CONFORMING AMENDMENTS.— 
(A) Section 26(b)(2) of such Code is 
amended by striking ‘‘and’’ at the end of sub-
paragraph (X), by striking the period at the 
end of subparagraph (Y) and inserting ‘‘, and’’, 
and by adding at the end the following new sub-
paragraph: 
‘‘(Z) section 24(j)(2) (relating to excess 
advance payments).’’. 
(B) Section 6211(b)(4)(A) of such Code, 
as amended by the preceding provisions of this 
subtitle, is amended— 
(i) by striking ‘‘24(d)’’ and inserting 
‘‘24 by reason of subsections (d) and (i)(1) 
thereof’’, and 
(ii) by striking ‘‘and 6428B’’ and in-
serting ‘‘6428B, and 7527A’’. 
(C) Paragraph (2) of section 1324(b) of 
title 31, United States Code, is amended— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00492
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
493 
(i) by inserting ‘‘24,’’ before ‘‘25A’’, 
and 
(ii) by striking ‘‘ or 6431’’ and insert-
ing ‘‘6431, or 7527A’’. 
(D) The table of sections for chapter 77 of 
the Internal Revenue Code of 1986 is amended 
by inserting after the item relating to section 
7527 the following new item: 
‘‘Sec. 7527A. Advance payment of child tax credit.’’. 
(5) APPROPRIATIONS TO CARRY OUT ADVANCE 
PAYMENTS.—Immediately upon the enactment of 
this Act, in addition to amounts otherwise available, 
there are appropriated for fiscal year 2021, out of 
any money in the Treasury not otherwise appro-
priated: 
(A) $397,200,000 to remain available until 
September 30, 2022, for necessary expenses for 
the Internal Revenue Service to carry out this 
section (and the amendments made by this sec-
tion), which shall supplement and not supplant 
any other appropriations that may be available 
for this purpose, and 
(B) $16,200,000 to remain available until 
September 30, 2022, for necessary expenses for 
the Bureau of the Fiscal Service to carry out 
this section (and the amendments made by this 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00493
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
494 
section), which shall supplement and not sup-
plant any other appropriations that may be 
available for this purpose. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—The amendments made by 
this section shall apply to taxable years beginning 
after December 31, 2020. 
(2) ESTABLISHMENT
OF
ADVANCE
PAYMENT 
PROGRAM.—The Secretary of the Treasury (or the 
Secretary’s designee) shall establish the program de-
scribed in section 7527A of the Internal Revenue 
Code of 1986 as soon as practicable after the date 
of the enactment of this Act, except that the Sec-
retary shall ensure that the timing of the establish-
ment of such program does not interfere with car-
rying out section 6428B(g) as rapidly as possible. 
SEC. 9612. APPLICATION OF CHILD TAX CREDIT IN POSSES-
SIONS. 
(a) IN GENERAL.—Section 24 of the Internal Rev-
enue Code of 1986, as amended by the preceding provi-
sions of this Act, is amended by adding at the end the 
following new subsection: 
‘‘(k) APPLICATION OF CREDIT IN POSSESSIONS.— 
‘‘(1) MIRROR CODE POSSESSIONS.— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00494
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
495 
‘‘(A) IN
GENERAL.—The Secretary shall 
pay to each possession of the United States 
with a mirror code tax system amounts equal to 
the loss (if any) to that possession by reason of 
the application of this section (determined with-
out regard to this subsection) with respect to 
taxable years beginning after 2020. Such 
amounts shall be determined by the Secretary 
based on information provided by the govern-
ment of the respective possession. 
‘‘(B) COORDINATION
WITH
CREDIT
AL-
LOWED
AGAINST
UNITED
STATES
INCOME 
TAXES.—No credit shall be allowed under this 
section for any taxable year to any individual to 
whom a credit is allowable against taxes im-
posed by a possession of the United States with 
a mirror code tax system by reason of the appli-
cation of this section in such possession for 
such taxable year. 
‘‘(C) MIRROR
CODE
TAX
SYSTEM.—For 
purposes of this paragraph, the term ‘mirror 
code tax system’ means, with respect to any 
possession of the United States, the income tax 
system of such possession if the income tax li-
ability of the residents of such possession under 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00495
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
496 
such system is determined by reference to the 
income tax laws of the United States as if such 
possession were the United States. 
‘‘(2) PUERTO RICO.— 
‘‘(A) APPLICATION TO TAXABLE YEARS IN 
2021.— 
‘‘(i) For application of refundable 
credit to residents of Puerto Rico, see sub-
section (i)(1). 
‘‘(ii) For nonapplication of advance 
payment to residents of Puerto Rico, see 
section 7527A(f)(5)(A). 
‘‘(B) APPLICATION
TO
TAXABLE
YEARS 
AFTER 2021.—In the case of any bona fide resi-
dent of Puerto Rico (within the meaning of sec-
tion 937(a)) for any taxable year beginning 
after December 31, 2021— 
‘‘(i) the credit determined under this 
section shall be allowable to such resident, 
and 
‘‘(ii) subsection (d)(1)(B)(ii) shall be 
applied without regard to the phrase ‘in 
the case of a taxpayer with 3 or more 
qualifying children’. 
‘‘(3) AMERICAN SAMOA.— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00496
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
497 
‘‘(A) IN
GENERAL.—The Secretary shall 
pay to American Samoa amounts estimated by 
the Secretary as being equal to the aggregate 
benefits that would have been provided to resi-
dents of American Samoa by reason of the ap-
plication of this section for taxable years begin-
ning after 2020 if the provisions of this section 
had been in effect in American Samoa (applied 
as if American Samoa were the United States 
and without regard to the application of this 
section to bona fide residents of Puerto Rico 
under subsection (i)(1)). 
‘‘(B) DISTRIBUTION REQUIREMENT.—Sub-
paragraph (A) shall not apply unless American 
Samoa has a plan, which has been approved by 
the Secretary, under which American Samoa 
will promptly distribute such payments to its 
residents. 
‘‘(C) COORDINATION
WITH
CREDIT
AL-
LOWED
AGAINST
UNITED
STATES
INCOME 
TAXES.— 
‘‘(i) IN GENERAL.—In the case of a 
taxable year with respect to which a plan 
is approved under subparagraph (B), this 
section (other than this subsection) shall 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00497
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
498 
not apply to any individual eligible for a 
distribution under such plan. 
‘‘(ii) APPLICATION
OF
SECTION
IN 
EVENT
OF
ABSENCE
OF
APPROVED 
PLAN.—In the case of a taxable year with 
respect to which a plan is not approved 
under subparagraph (B)— 
‘‘(I) if such taxable year begins 
in 2021, subsection (i)(1) shall be ap-
plied by substituting ‘bona fide resi-
dent of Puerto Rico or American 
Samoa’ for ‘bona fide resident of 
Puerto Rico’, and 
‘‘(II) if such taxable year begins 
after December 31, 2021, rules simi-
lar to the rules of paragraph (2)(B) 
shall apply with respect to bona fide 
residents of American Samoa (within 
the meaning of section 937(a)). 
‘‘(4) TREATMENT
OF
PAYMENTS.—For pur-
poses of section 1324 of title 31, United States 
Code, the payments under this subsection shall be 
treated in the same manner as a refund due from 
a credit provision referred to in subsection (b)(2) of 
such section.’’. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00498
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
499 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2020. 
PART 3—EARNED INCOME TAX CREDIT 
SEC. 9621. STRENGTHENING THE EARNED INCOME TAX 
CREDIT FOR INDIVIDUALS WITH NO QUALI-
FYING CHILDREN. 
(a) SPECIAL RULES FOR 2021.—Section 32 of the 
Internal Revenue Code of 1986 is amended by adding at 
the end the following new subsection: 
‘‘(n) SPECIAL RULES FOR INDIVIDUALS WITHOUT 
QUALIFYING CHILDREN.—In the case of any taxable year 
beginning after December 31, 2020, and before January 
1, 2022— 
‘‘(1) DECREASE IN MINIMUM AGE FOR CRED-
IT.— 
‘‘(A) 
IN
GENERAL.—Subsection 
(c)(1)(A)(ii)(II) shall be applied by substituting 
‘the applicable minimum age’ for ‘age 25’. 
‘‘(B) APPLICABLE
MINIMUM
AGE.—For 
purposes of this paragraph, the term ‘applicable 
minimum age’ means— 
‘‘(i) except as otherwise provided in 
this subparagraph, age 19, 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00499
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
500 
‘‘(ii) in the case of a specified student 
(other than a qualified former foster youth 
or a qualified homeless youth), age 24, and 
‘‘(iii) in the case of a qualified former 
foster youth or a qualified homeless youth, 
age 18. 
‘‘(C) SPECIFIED STUDENT.—For purposes 
of this paragraph, the term ‘specified student’ 
means, with respect to any taxable year, an in-
dividual who is an eligible student (as defined 
in section 25A(b)(3)) during at least 5 calendar 
months during the taxable year. 
‘‘(D) 
QUALIFIED
FORMER
FOSTER 
YOUTH.—For purposes of this paragraph, the 
term ‘qualified former foster youth’ means an 
individual who— 
‘‘(i) on or after the date that such in-
dividual attained age 14, was in foster care 
provided under the supervision or adminis-
tration of an entity administering (or eligi-
ble to administer) a plan under part B or 
part E of title IV of the Social Security 
Act (without regard to whether Federal as-
sistance was provided with respect to such 
child under such part E), and 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00500
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
501 
‘‘(ii) provides (in such manner as the 
Secretary may provide) consent for entities 
which administer a plan under part B or 
part E of title IV of the Social Security 
Act to disclose to the Secretary informa-
tion related to the status of such individual 
as a qualified former foster youth. 
‘‘(E) QUALIFIED HOMELESS YOUTH.—For 
purposes of this paragraph, the term ‘qualified 
homeless youth’ means, with respect to any tax-
able year, an individual who— 
‘‘(i) is certified by a local educational 
agency or a financial aid administrator 
during such taxable year as being either an 
unaccompanied youth who is a homeless 
child or youth, or as unaccompanied, at 
risk of homelessness, and self-supporting, 
and 
‘‘(ii) provides (in such manner as the 
Secretary may provide) consent for local 
educational agencies and financial aid ad-
ministrators to disclose to the Secretary in-
formation related to the status of such in-
dividual as a qualified homeless youth. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00501
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
502 
Terms used in this subparagraph which are also 
used in section 480(d)(1) of the Higher Edu-
cation Act of 1965 shall have the same meaning 
as when used in such section. 
‘‘(2) ELIMINATION
OF
MAXIMUM
AGE
FOR 
CREDIT.—Subsection (c)(1)(A)(ii)(II) shall be ap-
plied without regard to the phrase ‘but not attained 
age 65’. 
‘‘(3) INCREASE IN CREDIT AND PHASEOUT PER-
CENTAGES.—The table contained in subsection 
(b)(1) shall be applied by substituting ‘15.3’ for 
‘7.65’ each place it appears therein. 
‘‘(4) INCREASE
IN
EARNED
INCOME
AND 
PHASEOUT AMOUNTS.— 
‘‘(A) IN GENERAL.—The table contained in 
subsection (b)(2)(A) shall be applied— 
‘‘(i) by substituting ‘$9,820’ for 
‘$4,220’, and 
‘‘(ii) by substituting ‘$11,610’ for 
‘$5,280’. 
‘‘(B) COORDINATION WITH INFLATION AD-
JUSTMENT.—Subsection (j) shall not apply to 
any dollar amount specified in this paragraph.’’. 
(b) INFORMATION RETURN MATCHING.—As soon as 
practicable, the Secretary of the Treasury (or the Sec-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00502
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
503 
retary’s delegate) shall develop and implement procedures 
to use information returns under section 6050S (relating 
to returns relating to higher education tuition and related 
expenses) to check the status of individuals as specified 
students for purposes of section 32(n)(1)(B)(ii) of the In-
ternal Revenue Code of 1986 (as added by this section). 
(c) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2020. 
SEC. 9622. TAXPAYER ELIGIBLE FOR CHILDLESS EARNED 
INCOME CREDIT IN CASE OF QUALIFYING 
CHILDREN WHO FAIL TO MEET CERTAIN 
IDENTIFICATION REQUIREMENTS. 
(a) IN GENERAL.—Section 32(c)(1) of the Internal 
Revenue Code of 1986 is amended by striking subpara-
graph (F). 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31 2020. 
SEC. 9623. CREDIT ALLOWED IN CASE OF CERTAIN SEPA-
RATED SPOUSES. 
(a) IN GENERAL.—Section 32(d) of the Internal Rev-
enue Code of 1986 is amended— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00503
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
504 
(1) by striking ‘‘MARRIED INDIVIDUALS.—In 
the case of’’ and inserting the following: ‘‘MARRIED 
INDIVIDUALS.— 
‘‘(1) IN GENERAL.—In the case of’’, and 
(2) by adding at the end the following new 
paragraph: 
‘‘(2) DETERMINATION OF MARITAL STATUS.— 
For purposes of this section— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), marital status shall be deter-
mined under section 7703(a). 
‘‘(B) SPECIAL
RULE
FOR
SEPARATED 
SPOUSE.—An individual shall not be treated as 
married if such individual— 
‘‘(i) is married (as determined under 
section 7703(a)) and does not file a joint 
return for the taxable year, 
‘‘(ii) resides with a qualifying child of 
the individual for more than one-half of 
such taxable year, and 
‘‘(iii)(I) during the last 6 months of 
such taxable year, does not have the same 
principal place of abode as the individual’s 
spouse, or 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00504
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
505 
‘‘(II) has a decree, instrument, or 
agreement (other than a decree of divorce) 
described in section 121(d)(3)(C) with re-
spect to the individual’s spouse and is not 
a member of the same household with the 
individual’s spouse by the end of the tax-
able year.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 32(c)(1)(A) of such Code is amend-
ed by striking the last sentence. 
(2) Section 32(c)(1)(E)(ii) of such Code is 
amended by striking ‘‘(within the meaning of section 
7703)’’. 
(3) Section 32(d)(1) of such Code, as amended 
by subsection (a), is amended by striking ‘‘(within 
the meaning of section 7703)’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2020. 
SEC. 9624. MODIFICATION OF DISQUALIFIED INVESTMENT 
INCOME TEST. 
(a) IN GENERAL.—Section 32(i) of the Internal Rev-
enue Code of 1986 is amended by striking ‘‘$2,200’’ and 
inserting ‘‘$10,000’’. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00505
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
506 
(b) INFLATION ADJUSTMENT.—Section 32(j)(1) of 
such Code is amended— 
(1) in the matter preceding subparagraph (A), 
by inserting ‘‘(2021 in the case of the dollar amount 
in subsection (i)(1))’’ after ‘‘2015’’, 
(2) in subparagraph (B)(i)— 
(A) by striking ‘‘subsections (b)(2)(A) and 
(i)(1)’’ and inserting ‘‘subsection (b)(2)(A)’’, 
and 
(B) by striking ‘‘and’’ at the end, 
(3) by striking the period at the end of sub-
paragraph (B)(ii) and inserting ‘‘, and’’, and 
(4) by inserting after subparagraph (B)(ii) the 
following new clause: 
‘‘(iii) in the case of the $10,000 
amount in subsection (i)(1), ‘calendar year 
2020’ for ‘calendar year 2016’.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2020. 
SEC. 9625. APPLICATION OF EARNED INCOME TAX CREDIT 
IN POSSESSIONS OF THE UNITED STATES. 
(a) IN GENERAL.—Chapter 77 of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following new section: 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00506
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
507 
‘‘SEC. 7530. APPLICATION OF EARNED INCOME TAX CREDIT 
TO POSSESSIONS OF THE UNITED STATES. 
‘‘(a) PUERTO RICO.— 
‘‘(1) IN GENERAL.—With respect to calendar 
year 2021 and each calendar year thereafter, the 
Secretary shall, except as otherwise provided in this 
subsection, make payments to Puerto Rico equal 
to— 
‘‘(A) the specified matching amount for 
such calendar year, plus 
‘‘(B) in the case of calendar years 2021 
through 2025, the lesser of— 
‘‘(i) the expenditures made by Puerto 
Rico during such calendar year for edu-
cation efforts with respect to individual 
taxpayers and tax return preparers relat-
ing to the earned income tax credit, or 
‘‘(ii) $1,000,000. 
‘‘(2) REQUIREMENT TO REFORM EARNED IN-
COME TAX CREDIT.—The Secretary shall not make 
any payments under paragraph (1) with respect to 
any calendar year unless Puerto Rico has in effect 
an earned income tax credit for taxable years begin-
ning in or with such calendar year which (relative to 
the earned income tax credit which was in effect for 
taxable years beginning in or with calendar year 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00507
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
508 
2019) increases the percentage of earned income 
which is allowed as a credit for each group of indi-
viduals with respect to which such percentage is sep-
arately stated or determined in a manner designed 
to substantially increase workforce participation. 
‘‘(3) SPECIFIED MATCHING AMOUNT.—For pur-
poses of this subsection— 
‘‘(A) IN
GENERAL.—The term ‘specified 
matching amount’ means, with respect to any 
calendar year, the lesser of— 
‘‘(i) the excess (if any) of— 
‘‘(I) the cost to Puerto Rico of 
the earned income tax credit for tax-
able years beginning in or with such 
calendar year, over 
‘‘(II) the base amount for such 
calendar year, or 
‘‘(ii) the product of 3, multiplied by 
the base amount for such calendar year. 
‘‘(B) BASE AMOUNT.— 
‘‘(i) BASE AMOUNT FOR 2021.—In the 
case of calendar year 2021, the term ‘base 
amount’ means the greater of— 
‘‘(I) the cost to Puerto Rico of 
the earned income tax credit for tax-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00508
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
509 
able years beginning in or with cal-
endar year 2019 (rounded to the 
nearest multiple of $1,000,000), or 
‘‘(II) $200,000,000. 
‘‘(ii) INFLATION
ADJUSTMENT.—In 
the case of any calendar year after 2021, 
the term ‘base amount’ means the dollar 
amount determined under clause (i) in-
creased by an amount equal to— 
‘‘(I) such dollar amount, multi-
plied by— 
‘‘(II) the cost-of-living adjust-
ment determined under section 1(f)(3) 
for such calendar year, determined by 
substituting ‘calendar year 2020’ for 
‘calendar year 2016’ in subparagraph 
(A)(ii) thereof. 
Any amount determined under this clause 
shall be rounded to the nearest multiple of 
$1,000,000. 
‘‘(4) RULES RELATED TO PAYMENTS AND RE-
PORTS.— 
‘‘(A) TIMING
OF
PAYMENTS.—The Sec-
retary shall make payments under paragraph 
(1) for any calendar year— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00509
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
510 
‘‘(i) after receipt of the report de-
scribed in subparagraph (B) for such cal-
endar year, and 
‘‘(ii) except as provided in clause (i), 
within a reasonable period of time before 
the due date for individual income tax re-
turns (as determined under the laws of 
Puerto Rico) for taxable years which began 
on the first day of such calendar year. 
‘‘(B) ANNUAL REPORTS.—With respect to 
calendar year 2021 and each calendar year 
thereafter, Puerto Rico shall provide to the Sec-
retary a report which shall include— 
‘‘(i) an estimate of the costs described 
in paragraphs (1)(B)(i) and (3)(A)(i)(I) 
with respect to such calendar year, and 
‘‘(ii) a statement of such costs with 
respect to the preceding calendar year. 
‘‘(C) ADJUSTMENTS.— 
‘‘(i) IN GENERAL.—In the event that 
any estimate of an amount is more or less 
than the actual amount as later deter-
mined and any payment under paragraph 
(1) was determined on the basis of such 
estimate, proper payment shall be made 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00510
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
511 
by, or to, the Secretary (as the case may 
be) as soon as practicable after the deter-
mination that such estimate was inac-
curate. Proper adjustment shall be made in 
the amount of any subsequent payments 
made under paragraph (1) to the extent 
that proper payment is not made under the 
preceding sentence before such subsequent 
payments. 
‘‘(ii) 
ADDITIONAL
REPORTS.—The 
Secretary may require such additional peri-
odic reports of the information described in 
subparagraph (B) as the Secretary deter-
mines appropriate to facilitate timely ad-
justments under clause (i). 
‘‘(D) 
DETERMINATION
OF
COST
OF 
EARNED INCOME TAX CREDIT.—For purposes 
of this subsection, the cost to Puerto Rico of 
the earned income tax credit shall be deter-
mined by the Secretary on the basis of the laws 
of Puerto Rico and shall include reductions in 
revenues received by Puerto Rico by reason of 
such credit and refunds attributable to such 
credit, but shall not include any administrative 
costs with respect to such credit. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00511
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
512 
‘‘(b) POSSESSIONS WITH MIRROR CODE TAX SYS-
TEMS.— 
‘‘(1) IN GENERAL.—With respect to calendar 
year 2021 and each calendar year thereafter, the 
Secretary shall, except as otherwise provided in this 
subsection, make payments to the Virgin Islands, 
Guam, and the Commonwealth of the Northern Mar-
iana Islands equal to— 
‘‘(A) the cost to such possession of the 
earned income tax credit for taxable years be-
ginning in or with such calendar year, plus 
‘‘(B) in the case of calendar years 2021 
through 2025, the lesser of— 
‘‘(i) the expenditures made by such 
possession during such calendar year for 
education efforts with respect to individual 
taxpayers and tax return preparers relat-
ing to such earned income tax credit, or 
‘‘(ii) $50,000. 
‘‘(2) APPLICATION OF CERTAIN RULES.—Rules 
similar to the rules of subparagraphs (A), (B), (C), 
and (D) of subsection (a)(4) shall apply for purposes 
of this subsection. 
‘‘(c) AMERICAN SAMOA.— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00512
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
513 
‘‘(1) IN GENERAL.—With respect to calendar 
year 2021 and each calendar year thereafter, the 
Secretary shall, except as otherwise provided in this 
subsection, make payments to American Samoa 
equal to— 
‘‘(A) the lesser of— 
‘‘(i) the cost to American Samoa of 
the earned income tax credit for taxable 
years beginning in or with such calendar 
year, or 
‘‘(ii) $16,000,000, plus 
‘‘(B) in the case of calendar years 2021 
through 2025, the lesser of— 
‘‘(i) the expenditures made by Amer-
ican Samoa during such calendar year for 
education efforts with respect to individual 
taxpayers and tax return preparers relat-
ing to such earned income tax credit, or 
‘‘(ii) $50,000. 
‘‘(2) REQUIREMENT TO ENACT AND MAINTAIN 
AN EARNED INCOME TAX CREDIT.—The Secretary 
shall not make any payments under paragraph (1) 
with respect to any calendar year unless American 
Samoa has in effect an earned income tax credit for 
taxable years beginning in or with such calendar 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00513
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
514 
year which allows a refundable tax credit to individ-
uals on the basis of the taxpayer’s earned income 
which is designed to substantially increase workforce 
participation. 
‘‘(3) INFLATION ADJUSTMENT.—In the case of 
any calendar year after 2021, the $16,000,000 
amount in paragraph (1)(A)(ii) shall be increased by 
an amount equal to— 
‘‘(A) such dollar amount, multiplied by— 
‘‘(B) the cost-of-living adjustment deter-
mined under section 1(f)(3) for such calendar 
year, determined by substituting ‘calendar year 
2020’ for ‘calendar year 2016’ in subparagraph 
(A)(ii) thereof. 
Any increase determined under this clause shall be 
rounded to the nearest multiple of $100,000. 
‘‘(4) APPLICATION OF CERTAIN RULES.—Rules 
similar to the rules of subparagraphs (A), (B), (C), 
and (D) of subsection (a)(4) shall apply for purposes 
of this subsection. 
‘‘(d) TREATMENT OF PAYMENTS.—For purposes of 
section 1324 of title 31, United States Code, the payments 
under this section shall be treated in the same manner 
as a refund due from a credit provision referred to in sub-
section (b)(2) of such section.’’. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00514
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
515 
(b) CLERICAL AMENDMENT.—The table of sections 
for chapter 77 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new item: 
‘‘Sec. 7530. Application of earned income tax credit to possessions of the 
United States.’’. 
SEC. 9626. TEMPORARY SPECIAL RULE FOR DETERMINING 
EARNED INCOME FOR PURPOSES OF EARNED 
INCOME TAX CREDIT. 
(a) IN GENERAL.—If the earned income of the tax-
payer for the taxpayer’s first taxable year beginning in 
2021 is less than the earned income of the taxpayer for 
the taxpayer’s first taxable year beginning in 2019, the 
credit allowed under section 32 of the Internal Revenue 
Code of 1986 may, at the election of the taxpayer, be de-
termined by substituting-— 
(1) such earned income for the taxpayer’s first 
taxable year beginning in 2019, for 
(2) such earned income for the taxpayer’s first 
taxable year beginning in 2021. 
(b) EARNED INCOME.— 
(1) IN GENERAL.—For purposes of this section, 
the term ‘‘earned income’’ has the meaning given 
such term under section 32(c) of the Internal Rev-
enue Code of 1986. 
(2) APPLICATION
TO
JOINT
RETURNS.—For 
purposes of subsection (a), in the case of a joint re-
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00515
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
516 
turn, the earned income of the taxpayer for the first 
taxable year beginning in 2019 shall be the sum of 
the earned income of each spouse for such taxable 
year. 
(c) SPECIAL RULES.— 
(1) ERRORS TREATED AS MATHEMATICAL ER-
RORS.—For purposes of section 6213 of the Internal 
Revenue Code of 1986, an incorrect use on a return 
of earned income pursuant to subsection (a) shall be 
treated as a mathematical or clerical error. 
(2) NO EFFECT ON DETERMINATION OF GROSS 
INCOME, ETC.—Except as otherwise provided in this 
subsection, the Internal Revenue Code of 1986 shall 
be applied without regard to any substitution under 
subsection (a). 
(d) TREATMENT OF CERTAIN POSSESSIONS.— 
(1) PAYMENTS TO POSSESSIONS WITH MIRROR 
CODE TAX SYSTEMS.—The Secretary of the Treas-
ury shall pay to each possession of the United States 
which has a mirror code tax system amounts equal 
to the loss (if any) to that possession by reason of 
the application of the provisions of this section 
(other than this subsection) with respect to section 
32 of the Internal Revenue Code of 1986. Such 
amounts shall be determined by the Secretary of the 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00516
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
517 
Treasury based on information provided by the gov-
ernment of the respective possession. 
(2) PAYMENTS TO OTHER POSSESSIONS.—The 
Secretary of the Treasury shall pay to each posses-
sion of the United States which does not have a mir-
ror code tax system amounts estimated by the Sec-
retary of the Treasury as being equal to the aggre-
gate benefits (if any) that would have been provided 
to residents of such possession by reason of the pro-
visions of this section (other than this subsection) 
with respect to section 32 of the Internal Revenue 
Code of 1986 if a mirror code tax system had been 
in effect in such possession. The preceding sentence 
shall not apply unless the respective possession has 
a plan, which has been approved by the Secretary of 
the Treasury, under which such possession will 
promptly distribute such payments to its residents. 
(3) MIRROR CODE TAX SYSTEM.—For purposes 
of this section, the term ‘‘mirror code tax system’’ 
means, with respect to any possession of the United 
States, the income tax system of such possession if 
the income tax liability of the residents of such pos-
session under such system is determined by ref-
erence to the income tax laws of the United States 
as if such possession were the United States. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00517
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
518 
(4) TREATMENT OF PAYMENTS.—For purposes 
of section 1324 of title 31, United States Code, the 
payments under this section shall be treated in the 
same manner as a refund due from a credit provi-
sion referred to in subsection (b)(2) of such section. 
PART 4—DEPENDENT CARE ASSISTANCE 
SEC. 9631. REFUNDABILITY AND ENHANCEMENT OF CHILD 
AND DEPENDENT CARE TAX CREDIT. 
(a) IN GENERAL.—Section 21 of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following new subsection: 
‘‘(g) SPECIAL RULES FOR 2021.—In the case of any 
taxable year beginning after December 31, 2020, and be-
fore January 1, 2022— 
‘‘(1) CREDIT MADE REFUNDABLE.—If the tax-
payer (in the case of a joint return, either spouse) 
has a principal place of abode in the United States 
(determined as provided in section 32) for more than 
one-half of the taxable year, the credit allowed under 
subsection (a) shall be treated as a credit allowed 
under subpart C (and not allowed under this sub-
part). 
‘‘(2) INCREASE IN DOLLAR LIMIT ON AMOUNT 
CREDITABLE.—Subsection (c) shall be applied— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00518
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
519 
‘‘(A) by substituting ‘$8,000’ for ‘$3,000’ 
in paragraph (1) thereof, and 
‘‘(B) by substituting ‘$16,000’ for ‘$6,000’ 
in paragraph (2) thereof. 
‘‘(3) INCREASE IN APPLICABLE PERCENTAGE.— 
Subsection (a)(2) shall be applied— 
‘‘(A) by substituting ‘50 percent’ for ‘35 
percent ’, and 
‘‘(B) 
by 
substituting 
‘$125,000’ 
for 
‘$15,000’. 
‘‘(4) APPLICATION OF PHASEOUT TO HIGH IN-
COME INDIVIDUALS.— 
‘‘(A) IN
GENERAL.—Subsection (a)(2) 
shall be applied by substituting ‘the phaseout 
percentage’ for ‘20 percent’. 
‘‘(B) PHASEOUT PERCENTAGE.—The term 
‘phaseout percentage’ means 20 percent re-
duced (but not below zero) by 1 percentage 
point for each $2,000 (or fraction thereof) by 
which the taxpayer’s adjusted gross income for 
the taxable year exceeds $400,000.’’. 
(b) APPLICATION OF CREDIT IN POSSESSIONS.—Sec-
tion 21 of such Code, as amended by subsection (a), is 
amended by adding at the end the following new sub-
section: 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00519
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
520 
‘‘(h) APPLICATION OF CREDIT IN POSSESSIONS.— 
‘‘(1) PAYMENT TO POSSESSIONS WITH MIRROR 
CODE TAX SYSTEMS.—The Secretary shall pay to 
each possession of the United States with a mirror 
code tax system amounts equal to the loss (if any) 
to that possession by reason of the application of 
this section (determined without regard to this sub-
section) with respect to taxable years beginning in or 
with 2021. Such amounts shall be determined by the 
Secretary based on information provided by the gov-
ernment of the respective possession. 
‘‘(2) PAYMENTS TO OTHER POSSESSIONS.—The 
Secretary shall pay to each possession of the United 
States which does not have a mirror code tax system 
amounts estimated by the Secretary as being equal 
to the aggregate benefits that would have been pro-
vided to residents of such possession by reason of 
this section with respect to taxable years beginning 
in or with 2021 if a mirror code tax system had 
been in effect in such possession. The preceding sen-
tence shall not apply unless the respective possession 
has a plan, which has been approved by the Sec-
retary, under which such possession will promptly 
distribute such payments to its residents. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00520
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
521 
‘‘(3) COORDINATION
WITH
CREDIT
ALLOWED 
AGAINST UNITED STATES INCOME TAXES.—In the 
case of any taxable year beginning in or with 2021, 
no credit shall be allowed under this section to any 
individual— 
‘‘(A) to whom a credit is allowable against 
taxes imposed by a possession with a mirror 
code tax system by reason of this section, or 
‘‘(B) who is eligible for a payment under 
a plan described in paragraph (2). 
‘‘(4) MIRROR
CODE
TAX
SYSTEM.—For pur-
poses of this subsection, the term ‘mirror code tax 
system’ means, with respect to any possession of the 
United States, the income tax system of such posses-
sion if the income tax liability of the residents of 
such possession under such system is determined by 
reference to the income tax laws of the United 
States as if such possession were the United States. 
‘‘(5) TREATMENT
OF
PAYMENTS.—For pur-
poses of section 1324 of title 31, United States 
Code, the payments under this subsection 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) CONFORMING AMENDMENTS.— 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00521
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
522 
(1) Section 6211(b)(4)(A) of such Code, as 
amended by the preceding provisions of this Act, is 
amended by inserting ‘‘21 by reason of subsection 
(g) thereof,’’ before ‘‘24’’. 
(2) Section 1324(b)(2) of title 31, United 
States Code (as amended by the preceding provi-
sions of this title), is amended by inserting ‘‘21,’’ be-
fore ‘‘24’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2020. 
SEC. 9632. INCREASE IN EXCLUSION FOR EMPLOYER-PRO-
VIDED DEPENDENT CARE ASSISTANCE. 
(a) IN GENERAL.—Section 129(a)(2) of the Internal 
Revenue Code of 1986 is amended by adding at the end 
the following new subparagraph: 
‘‘(D) SPECIAL
RULE
FOR
2021.—In the 
case of any taxable year beginning after Decem-
ber 31, 2020, and before January 1, 2022, sub-
paragraph (A) shall be applied be substituting 
‘$10,500 (half such dollar amount’ for ‘$5,000 
($2,500’.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2020. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00522
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
559 
‘‘(A) use the interest rate used by the plan 
in its most recently completed certification of 
plan status before January 1, 2021, provided 
that such interest rate may not exceed the in-
terest rate limit; and 
‘‘(B) for other assumptions, use the as-
sumptions that the plan used in its most re-
cently completed certification of plan status be-
fore January 1, 2021, unless such assumptions 
are unreasonable. 
‘‘(3) INTEREST RATE.—The interest rate limit 
for purposes of this subsection is the rate specified 
in section 303(h)(2)(C)(iii) (disregarding modifica-
tions made under clause (iv) of such section) for the 
month in which the application for special financial 
assistance is filed by the eligible multiemployer plan 
or the 3 preceding months, with such specified rate 
increased by 200 basis points. 
‘‘(4) CHANGES IN ASSUMPTIONS.—If a plan de-
termines that use of one or more prior assumptions 
is unreasonable, the plan may propose in its applica-
tion to change such assumptions, provided that the 
plan discloses such changes in its application and 
describes why such assumptions are no longer rea-
sonable. The corporation shall accept such changed 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00559
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS
569 
with respect to such bases, shall be reduced to 
zero, and 
‘‘(B) subparagraphs (A) and (B) of para-
graph (2) shall each be applied by substituting 
‘15-plan-year period’ for ‘7-plan-year period’.’’. 
(b) 15-YEAR AMORTIZATION UNDER THE EMPLOYEE 
RETIREMENT INCOME SECURITY ACT OF 1974.—Section 
303(c) of the Employee Retirement Income Security Act 
of 1974 (29 U.S.C. 1083(c)) is amended by adding at the 
end the following new paragraph: 
‘‘(8) 15-YEAR AMORTIZATION.—With respect to 
plan years beginning after December 31, 2019 (or, 
at the election of the plan sponsor, after December 
31, 2018)— 
‘‘(A) the shortfall amortization bases for 
all plan years preceding the first plan year be-
ginning after December 31, 2019 (or after De-
cember 31, 2018, whichever is elected), and all 
shortfall amortization installments determined 
with respect to such bases, shall be reduced to 
zero, and 
‘‘(B) subparagraphs (A) and (B) of para-
graph (2) shall each be applied by substituting 
‘15-plan-year period’ for ‘7-plan-year period’.’’. 
VerDate Sep 11 2014 
00:45 Feb 25, 2021
Jkt 019200
PO 00000
Frm 00569
Fmt 6652
Sfmt 6201
E:\BILLS\H1319.RH
H1319
pamtmann on DSKBC07HB2PROD with BILLS