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† HR 1319 EAS 
‘‘(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 
‘‘(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 taxable 
year.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 32(c)(1)(A) of such Code is amended 
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)’’.
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† HR 1319 EAS 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to taxable years beginning after Decem-
ber 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’’. 
(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 subpara-
graph (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’.’’.
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† HR 1319 EAS 
(c) EFFECTIVE DATE.—The amendments made by this 
section shall apply to taxable years beginning after Decem-
ber 31, 2020. 
SEC. 9625. APPLICATION OF EARNED INCOME TAX CREDIT 
IN POSSESSIONS OF THE UNITED STATES. 
(a) IN GENERAL.—Chapter 77 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following 
new section: 
‘‘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 Sec-
retary shall, except as otherwise provided in this sub-
section, 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 tax-
payers and tax return preparers relating to 
the earned income tax credit, or 
‘‘(ii) $1,000,000.
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† HR 1319 EAS 
‘‘(2) REQUIREMENT TO REFORM EARNED INCOME 
TAX CREDIT.—The Secretary shall not make any pay-
ments under paragraph (1) with respect to any cal-
endar year unless Puerto Rico has in effect an earned 
income tax credit for taxable years beginning 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 2019) in-
creases the percentage of earned income which is al-
lowed as a credit for each group of individuals with 
respect to which such percentage is separately 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 taxable 
years beginning in or with such cal-
endar year, over 
‘‘(II) the base amount for such 
calendar year, or
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† HR 1319 EAS 
‘‘(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 taxable 
years beginning in or with calendar 
year 2019 (rounded to the nearest mul-
tiple 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 adjustment 
determined under section 1(f)(3) for 
such calendar year, determined by sub-
stituting ‘calendar year 2020’ for ‘cal-
endar year 2016’ in subparagraph 
(A)(ii) thereof.
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Any amount determined under this clause 
shall be rounded to the nearest multiple of 
$1,000,000. 
‘‘(4) RULES RELATED TO PAYMENTS.— 
‘‘(A) TIMING OF PAYMENTS.—The Secretary 
shall make payments under paragraph (1) for 
any calendar year— 
‘‘(i) after receipt of such information 
as the Secretary may require to determine 
such payments, 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) INFORMATION.—The Secretary may 
require the reporting of such information as the 
Secretary may require to carry out this sub-
section. 
‘‘(C) DETERMINATION OF COST OF EARNED 
INCOME TAX CREDIT.—For purposes of this sub-
section, the cost to Puerto Rico of the earned in-
come tax credit shall be determined by the Sec-
retary on the basis of the laws of Puerto Rico
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† HR 1319 EAS 
and shall include reductions in revenues received 
by Puerto Rico by reason of such credit and re-
funds attributable to such credit, but shall not 
include any administrative costs with respect to 
such credit. 
‘‘(b) POSSESSIONS WITH MIRROR CODE TAX SYS-
TEMS.— 
‘‘(1) IN
GENERAL.—With respect to calendar 
year 2021 and each calendar year thereafter, the Sec-
retary shall, except as otherwise provided in this sub-
section, make payments to the Virgin Islands, Guam, 
and the Commonwealth of the Northern Mariana Is-
lands equal to— 
‘‘(A) the cost to such possession of the 
earned income tax credit for taxable years begin-
ning 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 relating 
to such earned income tax credit, or 
‘‘(ii) $50,000.
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‘‘(2) APPLICATION OF CERTAIN RULES.—Rules 
similar to the rules of subparagraphs (A), (B), and 
(C) of subsection (a)(4) shall apply for purposes of 
this subsection. 
‘‘(c) AMERICAN SAMOA.— 
‘‘(1) IN
GENERAL.—With respect to calendar 
year 2021 and each calendar year thereafter, the Sec-
retary shall, except as otherwise provided in this sub-
section, 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 relating 
to such earned income tax credit, or 
‘‘(ii) $50,000. 
‘‘(2) REQUIREMENT TO ENACT AND MAINTAIN AN 
EARNED INCOME TAX CREDIT.—The Secretary shall
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† HR 1319 EAS 
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 year which 
allows a refundable tax credit to individuals on the 
basis of the taxpayer’s earned income which is de-
signed to substantially increase workforce participa-
tion. 
‘‘(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), and 
(C) of subsection (a)(4) shall apply for purposes of 
this subsection.
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‘‘(d) TREATMENT OF PAYMENTS.—For purposes of sec-
tion 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.’’. 
(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 determined 
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.—
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† HR 1319 EAS 
(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 Revenue Code 
of 1986. 
(2) APPLICATION TO JOINT RETURNS.—For pur-
poses of subsection (a), in the case of a joint return, 
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 sub-
section (a). 
(d) TREATMENT OF CERTAIN POSSESSIONS.— 
(1) PAYMENTS TO POSSESSIONS WITH MIRROR 
CODE TAX SYSTEMS.—The Secretary of the Treasury 
shall pay to each possession of the United States 
which has a mirror code tax system amounts equal to
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† HR 1319 EAS 
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 Treasury based 
on information provided by the government of the re-
spective possession. 
(2) PAYMENTS
TO
OTHER
POSSESSIONS.—The 
Secretary of the Treasury shall pay to each possession 
of the United States which does not have a mirror 
code tax system amounts estimated by the Secretary 
of the Treasury as being equal to the aggregate bene-
fits (if any) that would have been provided to resi-
dents of such possession by reason of the provisions 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 un-
less 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
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† HR 1319 EAS 
States, the income tax system of such possession 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 pos-
session were the United States. 
(4) TREATMENT OF PAYMENTS.—For purposes of 
section 1324 of title 31, United States Code, the pay-
ments under this section shall be treated in the same 
manner as a refund due from a credit provision re-
ferred 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 Revenue 
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 before 
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 (de-
termined 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
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† HR 1319 EAS 
under subpart C (and not allowed under this sub-
part). 
‘‘(2) INCREASE IN DOLLAR LIMIT ON AMOUNT 
CREDITABLE.—Subsection (c) shall be applied— 
‘‘(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 percent-
age’ for ‘20 percent’. 
‘‘(B) PHASEOUT
PERCENTAGE.—The term 
‘phaseout percentage’ means 20 percent reduced 
(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.’’.
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† HR 1319 EAS 
(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 subsection: 
‘‘(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 pos-
session by reason of the application of this section 
(determined without regard to this subsection) with 
respect to taxable years beginning in or with 2021. 
Such amounts shall be determined by the Secretary 
based on information provided by the government 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 provided 
to residents of such possession by reason of this sec-
tion 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 sentence shall 
not apply unless the respective possession has a plan, 
which has been approved by the Secretary, under
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† HR 1319 EAS 
which such possession will promptly distribute such 
payments to its residents. 
‘‘(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 indi-
vidual— 
‘‘(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 purposes 
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 possession 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 pos-
session were the United States. 
‘‘(5) 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 provision 
referred to in subsection (b)(2) of such section.’’.
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† HR 1319 EAS 
(c) CONFORMING AMENDMENTS.— 
(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 provisions of this 
title), is amended by inserting ‘‘21,’’ before ‘‘24’’. 
(d) EFFECTIVE DATE.—The amendments made by this 
section shall apply to taxable years beginning after Decem-
ber 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 December 31, 
2020, and before January 1, 2022, subparagraph 
(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 Decem-
ber 31, 2020.
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† HR 1319 EAS 
(c) RETROACTIVE PLAN AMENDMENTS.—A plan that 
otherwise satisfies all applicable requirements of sections 
125 and 129 of the Internal Revenue Code of 1986 (includ-
ing any rules or regulations thereunder) shall not fail to 
be treated as a cafeteria plan or dependent care assistance 
program merely because such plan is amended pursuant to 
a provision under this section and such amendment is ret-
roactive, if— 
(1) such amendment is adopted no later than the 
last day of the plan year in which the amendment is 
effective, and 
(2) the plan is operated consistent with the terms 
of such amendment during the period beginning on 
the effective date of the amendment and ending on the 
date the amendment is adopted. 
PART 5—CREDITS FOR PAID SICK AND FAMILY 
LEAVE 
SEC. 9641. PAYROLL CREDITS. 
(a) IN GENERAL.—Chapter 21 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following 
new subchapter: 
‘‘Subchapter D—Credits 
‘‘Sec. 3131. Credit for paid sick leave. 
‘‘Sec. 3132. Payroll credit for paid family leave. 
‘‘Sec. 3133. Special rule related to tax on employers.
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† HR 1319 EAS 
‘‘SEC. 3131. CREDIT FOR PAID SICK LEAVE. 
‘‘(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 100 
percent of the qualified sick leave wages paid by such em-
ployer with respect to such calendar quarter. 
‘‘(b) LIMITATIONS AND REFUNDABILITY.— 
‘‘(1) 
WAGES
TAKEN
INTO
ACCOUNT.—The 
amount of qualified sick leave wages taken into ac-
count under subsection (a), plus any increases under 
subsection (e), with respect to any individual shall 
not exceed $200 ($511 in the case of any day any 
portion of which is paid sick time described in para-
graph (1), (2), or (3) of section 5102(a) of the Emer-
gency Paid Sick Leave Act, applied with the modi-
fication described in subsection (c)(2)(A)(i)) for any 
day (or portion thereof) for which the individual is 
paid qualified sick leave wages. 
‘‘(2) OVERALL LIMITATION ON NUMBER OF DAYS 
TAKEN
INTO
ACCOUNT.—The aggregate number of 
days taken into account under paragraph (1) for any 
calendar quarter shall not exceed the excess (if any) 
of— 
‘‘(A) 10, over 
‘‘(B) the aggregate number of days so taken 
into account during preceding calendar quarters
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† HR 1319 EAS 
in such calendar year (other than the first quar-
ter of calendar year 2021). 
‘‘(3) CREDIT LIMITED TO CERTAIN EMPLOYMENT 
TAXES.—The credit allowed by subsection (a) with re-
spect to any calendar quarter shall not exceed the ap-
plicable employment taxes for such calendar quarter 
on the wages paid with respect to the employment of 
all employees of the employer. 
‘‘(4) REFUNDABILITY OF EXCESS CREDIT.— 
‘‘(A) CREDIT
IS
REFUNDABLE.—If the 
amount of the credit under subsection (a) exceeds 
the limitation of paragraph (3) for any calendar 
quarter, such excess shall be treated as an over-
payment that shall be refunded under sections 
6402(a) and 6413(b). 
‘‘(B) ADVANCING CREDIT.—In anticipation 
of the credit, including the refundable portion 
under subparagraph (A), the credit shall be ad-
vanced, according to forms and instructions pro-
vided by the Secretary, up to an amount cal-
culated under subsection (a), subject to the limits 
under paragraph (1) and (2), all calculated 
through the end of the most recent payroll period 
in the quarter.
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† HR 1319 EAS 
‘‘(c) QUALIFIED SICK LEAVE WAGES.—For purposes 
of this section— 
‘‘(1) IN
GENERAL.—The term ‘qualified sick 
leave wages’ means wages paid by an employer which 
would be required to be paid by reason of the Emer-
gency Paid Sick Leave Act as if such Act applied 
after March 31, 2021. 
‘‘(2) RULES OF APPLICATION.—For purposes of 
determining whether wages are qualified sick leave 
wages under paragraph (1)— 
‘‘(A) IN GENERAL.—The Emergency Paid 
Sick Leave Act shall be applied— 
‘‘(i) by inserting ‘, the employee is 
seeking or awaiting the results of a diag-
nostic test for, or a medical diagnosis of, 
COVID–19 and such employee has been ex-
posed to COVID–19 or the employee’s em-
ployer has requested such test or diagnosis, 
or the employee is obtaining immunization 
related to COVID–19 or recovering from 
any injury, disability, illness, or condition 
related to such immunization’ after ‘med-
ical diagnosis’ in section 5102(a)(3) thereof, 
and
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† HR 1319 EAS 
‘‘(ii) by applying section 5102(b)(1) of 
such Act separately with respect to each cal-
endar year after 2020 (and, in the case of 
calendar year 2021, without regard to the 
first quarter thereof). 
‘‘(B) LEAVE MUST MEET REQUIREMENTS.— 
If an employer fails to comply with any require-
ment of such Act (determined without regard to 
section 5109 thereof) with respect to paid sick 
time (as defined in section 5110 of such Act), 
amounts paid by such employer with respect to 
such paid sick time shall not be taken into ac-
count as qualified sick leave wages. For purposes 
of the preceding sentence, an employer which 
takes an action described in section 5104 of such 
Act shall be treated as failing to meet a require-
ment of such Act. 
‘‘(d) ALLOWANCE OF CREDIT FOR CERTAIN HEALTH 
PLAN EXPENSES.— 
‘‘(1) IN GENERAL.—The amount of the credit al-
lowed under subsection (a) shall be increased by so 
much of the employer’s qualified health plan expenses 
as are properly allocable to the qualified sick leave 
wages for which such credit is so allowed.
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† HR 1319 EAS 
‘‘(2) QUALIFIED HEALTH PLAN EXPENSES.—For 
purposes of this subsection, the term ‘qualified health 
plan expenses’ means amounts paid or incurred by 
the employer to provide and maintain a group health 
plan (as defined in section 5000(b)(1)), but only to 
the extent that such amounts are excluded from the 
gross income of employees by reason of section 106(a). 
‘‘(3) ALLOCATION RULES.—For purposes of this 
section, qualified health plan expenses shall be allo-
cated to qualified sick leave wages in such manner as 
the Secretary may prescribe. Except as otherwise pro-
vided by the Secretary, such allocation shall be treat-
ed as properly made if made on the basis of being pro 
rata among covered employees and pro rata on the 
basis of periods of coverage (relative to the time peri-
ods of leave to which such wages relate). 
‘‘(e) ALLOWANCE
OF CREDIT
FOR AMOUNTS PAID 
UNDER
CERTAIN
COLLECTIVELY
BARGAINED
AGREE-
MENTS.— 
‘‘(1) IN GENERAL.—The amount of the credit al-
lowed under subsection (a) shall be increased by the 
sum of— 
‘‘(A) so much of the employer’s collectively 
bargained defined benefit pension plan contribu-
tions as are properly allocable to the qualified
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† HR 1319 EAS 
sick leave wages for which such credit is so al-
lowed, plus 
‘‘(B) so much of the employer’s collectively 
bargained apprenticeship program contributions 
as are properly allocable to the qualified sick 
leave wages for which such credit is so allowed. 
‘‘(2) COLLECTIVELY BARGAINED DEFINED BEN-
EFIT PENSION PLAN CONTRIBUTIONS.—For purposes 
of this subsection— 
‘‘(A) IN GENERAL.—The term ‘collectively 
bargained defined benefit pension plan contribu-
tions’ means, with respect to any calendar quar-
ter, contributions which— 
‘‘(i) are paid or incurred by an em-
ployer during the calendar quarter on be-
half of its employees to a defined benefit 
plan (as defined in section 414(j)), which 
meets the requirements of section 401(a), 
‘‘(ii) are made based on a pension con-
tribution rate, and 
‘‘(iii) are required to be made pursu-
ant to the terms of a collective bargaining 
agreement in effect with respect to such cal-
endar quarter.
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† HR 1319 EAS 
‘‘(B) PENSION
CONTRIBUTION
RATE.—The 
term ‘pension contribution rate’ means the con-
tribution rate that the employer is obligated to 
pay on behalf of its employees under the terms 
of a collective bargaining agreement for benefits 
under a defined benefit plan under such agree-
ment, as such rate is applied to contribution 
base units (as defined by section 4001(a)(11) of 
the Employee Retirement Income Security Act of 
1974 (29 U.S.C. 1301(a)(11)). 
‘‘(C) ALLOCATION RULES.—The amount of 
collectively bargained defined benefit pension 
plan contributions allocated to qualified sick 
leave wages for any calendar quarter shall be the 
product of— 
‘‘(i) the pension contribution rate (ex-
pressed as an hourly rate), and 
‘‘(ii) the number of hours for which 
qualified sick leave wages were provided to 
employees covered under the collective bar-
gaining agreement described in subpara-
graph (A)(iii) during the calendar quarter. 
‘‘(3) COLLECTIVELY
BARGAINED
APPRENTICE-
SHIP
PROGRAM
CONTRIBUTIONS.—For purposes of 
this section—
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† HR 1319 EAS 
‘‘(A) IN GENERAL.—The term ‘collectively 
bargained apprenticeship program contributions’ 
means, with respect to any calendar quarter, 
contributions which— 
‘‘(i) are paid or incurred by an em-
ployer on behalf of its employees with re-
spect to the calendar quarter to a registered 
apprenticeship program, 
‘‘(ii) are made based on an apprentice-
ship program contribution rate, and 
‘‘(iii) are required to be made pursu-
ant to the terms of a collective bargaining 
agreement that is in effect with respect to 
such calendar quarter. 
‘‘(B) REGISTERED
APPRENTICESHIP
PRO-
GRAM.—The term ‘registered apprenticeship pro-
gram’ means an apprenticeship registered under 
the Act of August 16, 1937 (commonly known as 
the ‘National Apprenticeship Act’; 50 Stat. 664, 
chapter 663; 29 U.S.C. 50 et seq.) that meets the 
standards of subpart A of part 29 and part 30 
of title 29, Code of Federal Regulations. 
‘‘(C) APPRENTICESHIP PROGRAM CONTRIBU-
TION RATE.—The term ‘apprenticeship program 
contribution rate’ means the contribution rate
412 
† HR 1319 EAS 
that the employer is obligated to pay on behalf 
of its employees under the terms of a collective 
bargaining agreement for benefits under a reg-
istered apprenticeship program under such 
agreement, as such rate is applied to contribu-
tion 
base 
units 
(as 
defined 
by 
section 
4001(a)(11) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1301(a)(11)). 
‘‘(D) ALLOCATION RULES.—The amount of 
collectively bargained apprenticeship program 
contributions allocated to qualified sick leave 
wages for any calendar quarter shall be the prod-
uct of— 
‘‘(i) the apprenticeship program con-
tribution rate (expressed as an hourly rate), 
and 
‘‘(ii) the number of hours for which 
qualified sick leave wages were provided to 
employees covered under the collective bar-
gaining agreement described in subpara-
graph (A)(iii) during the calendar quarter. 
‘‘(f) DEFINITIONS AND SPECIAL RULES.— 
‘‘(1) APPLICABLE
EMPLOYMENT
TAXES.—For 
purposes of this section, the term ‘applicable employ-
ment taxes’ means the following:
413 
† HR 1319 EAS 
‘‘(A) The taxes imposed under section 
3111(b). 
‘‘(B) So much of the taxes imposed under 
section 3221(a) as are attributable to the rate in 
effect under section 3111(b). 
‘‘(2) WAGES.—For purposes of this section, the 
term ‘wages’ means wages (as defined in section 
3121(a), determined without regard to paragraphs (1) 
through (22) of section 3121(b)) and compensation 
(as defined in section 3231(e), determined without re-
gard to the sentence in paragraph (1) thereof which 
begins ‘Such term does not include remuneration’). 
‘‘(3) DENIAL OF DOUBLE BENEFIT.—For pur-
poses of chapter 1, the gross income of the employer, 
for the taxable year which includes the last day of 
any calendar quarter with respect to which a credit 
is allowed under this section, shall be increased by the 
amount of such credit. Any wages taken into account 
in determining the credit allowed under this section 
shall not be taken into account for purposes of deter-
mining the credit allowed under sections 45A, 45P, 
45S, 51, 3132, and 3134. In the case of any credit al-
lowed under section 2301 of the CARES Act or sec-
tion 41 with respect to wages taken into account 
under this section, the credit allowed under this sec-
414 
† HR 1319 EAS 
tion shall be reduced by the portion of the credit al-
lowed under such section 2301 or section 41 which is 
attributable to such wages. 
‘‘(4) ELECTION TO NOT TAKE CERTAIN WAGES 
INTO ACCOUNT.—This section shall not apply to so 
much of the qualified sick leave wages paid by an eli-
gible employer as such employer elects (at such time 
and in such manner as the Secretary may prescribe) 
to not take into account for purposes of this section. 
‘‘(5) CERTAIN GOVERNMENTAL EMPLOYERS.—No 
credit shall be allowed under this section to the Gov-
ernment of the United States or to any agency or in-
strumentality thereof. The preceding sentence shall 
not apply to any organization described in section 
501(c)(1) and exempt from tax under section 501(a). 
‘‘(6) EXTENSION
OF
LIMITATION
ON
ASSESS-
MENT.—Notwithstanding section 6501, the limitation 
on the time period for the assessment of any amount 
attributable to a credit claimed under this section 
shall not expire before the date that is 5 years after 
the later of— 
‘‘(A) the date on which the original return 
which includes the calendar quarter with respect 
to which such credit is determined is filed, or
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† HR 1319 EAS 
‘‘(B) the date on which such return is treat-
ed as filed under section 6501(b)(2). 
‘‘(7) 
COORDINATION
WITH
CERTAIN
PRO-
GRAMS.— 
‘‘(A) IN GENERAL.—This section shall not 
apply to so much of the qualified sick leave 
wages paid by an eligible employer as are taken 
into account as payroll costs in connection 
with— 
‘‘(i) a covered loan under section 
7(a)(37) or 7A of the Small Business Act, 
‘‘(ii) a grant under section 324 of the 
Economic Aid to Hard-Hit Small Busi-
nesses, Non-Profits, and Venues Act, or 
‘‘(iii) a restaurant revitalization grant 
under section 5003 of the American Rescue 
Plan Act of 2021. 
‘‘(B) APPLICATION WHERE PPP LOANS NOT 
FORGIVEN.—The Secretary shall issue guidance 
providing that payroll costs paid during the cov-
ered period shall not fail to be treated as quali-
fied sick leave wages under this section by reason 
of subparagraph (A)(i) to the extent that— 
‘‘(i) a covered loan of the taxpayer 
under section 7(a)(37) of the Small Busi-
416 
† HR 1319 EAS 
ness Act is not forgiven by reason of a deci-
sion under section 7(a)(37)(J) of such Act, 
or 
‘‘(ii) a covered loan of the taxpayer 
under section 7A of the Small Business Act 
is not forgiven by reason of a decision 
under section 7A(g) of such Act. 
Terms used in the preceding sentence which are 
also used in section 7A(g) or 7(a)(37)(J) of the 
Small Business Act shall, when applied in con-
nection with either such section, have the same 
meaning as when used in such section, respec-
tively. 
‘‘(g) REGULATIONS.—The Secretary shall prescribe 
such regulations or other guidance as may be necessary to 
carry out the purposes of this section, including— 
‘‘(1) regulations or other guidance to prevent the 
avoidance of the purposes of the limitations under 
this section, 
‘‘(2) regulations or other guidance to minimize 
compliance and record-keeping burdens under this 
section, 
‘‘(3) regulations or other guidance providing for 
waiver of penalties for failure to deposit amounts in
417 
† HR 1319 EAS 
anticipation of the allowance of the credit allowed 
under this section, 
‘‘(4) regulations or other guidance for recap-
turing the benefit of credits determined under this sec-
tion in cases where there is a subsequent adjustment 
to the credit determined under subsection (a), 
‘‘(5) regulations or other guidance to ensure that 
the wages taken into account under this section con-
form with the paid sick time required to be provided 
under the Emergency Paid Sick Leave Act, 
‘‘(6) regulations or other guidance to permit the 
advancement of the credit determined under sub-
section (a), and 
‘‘(7) regulations or other guidance with respect 
to the allocation, reporting, and substantiation of col-
lectively bargained defined benefit pension plan con-
tributions and collectively bargained apprenticeship 
program contributions. 
‘‘(h) APPLICATION OF SECTION.—This section shall 
apply only to wages paid with respect to the period begin-
ning on April 1, 2021, and ending on September 30, 2021. 
‘‘(i) TREATMENT OF DEPOSITS.—The Secretary shall 
waive any penalty under section 6656 for any failure to 
make a deposit of applicable employment taxes if the Sec-
418 
† HR 1319 EAS 
retary determines that such failure was due to the anticipa-
tion of the credit allowed under this section. 
‘‘(j) NON-DISCRIMINATION REQUIREMENT.—No credit 
shall be allowed under this section to any employer for any 
calendar quarter if such employer, with respect to the avail-
ability of the provision of qualified sick leave wages to 
which this section otherwise applies for such calendar quar-
ter, discriminates in favor of highly compensated employees 
(within the meaning of section 414(q)), full-time employees, 
or employees on the basis of employment tenure with such 
employer. 
‘‘SEC. 3132. PAYROLL CREDIT FOR PAID FAMILY LEAVE. 
‘‘(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 100 
percent of the qualified family leave wages paid by such 
employer with respect to such calendar quarter. 
‘‘(b) LIMITATIONS AND REFUNDABILITY.— 
‘‘(1) 
WAGES
TAKEN
INTO
ACCOUNT.—The 
amount of qualified family leave wages taken into ac-
count under subsection (a), plus any increases under 
subsection (e), with respect to any individual shall 
not exceed—
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† HR 1319 EAS 
‘‘(A) for any day (or portion thereof) for 
which the individual is paid qualified family 
leave wages, $200, and 
‘‘(B) in the aggregate with respect to all 
calendar quarters, $12,000. 
‘‘(2) CREDIT LIMITED TO CERTAIN EMPLOYMENT 
TAXES.—The credit allowed by subsection (a) with re-
spect to any calendar quarter shall not exceed the ap-
plicable employment taxes for such calendar quarter 
(reduced by any credits allowed under section 3131) 
on the wages paid with respect to the employment of 
all employees of the employer. 
‘‘(3) REFUNDABILITY OF EXCESS CREDIT.— 
‘‘(A) CREDIT
IS
REFUNDABLE.—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 over-
payment that shall be refunded under sections 
6402(a) and 6413(b). 
‘‘(B) ADVANCING CREDIT.—In anticipation 
of the credit, including the refundable portion 
under subparagraph (A), the credit shall be ad-
vanced, according to forms and instructions pro-
vided by the Secretary, up to an amount cal-
culated under subsection (a), subject to the limits
420 
† HR 1319 EAS 
under paragraph (1) and (2), all calculated 
through the end of the most recent payroll period 
in the quarter. 
‘‘(c) QUALIFIED FAMILY LEAVE WAGES.— 
‘‘(1) IN GENERAL.—For purposes of this section, 
the term ‘qualified family leave wages’ means wages 
paid by an employer which would be required to be 
paid by reason of the Emergency Family and Medical 
Leave Expansion Act (including the amendments 
made by such Act) as if such Act (and amendments 
made by such Act) applied after March 31, 2021. 
‘‘(2) RULES OF APPLICATION.— 
‘‘(A) IN GENERAL.—For purposes of deter-
mining whether wages are qualified family leave 
wages under paragraph (1)— 
‘‘(i) section 110(a)(2)(A) of the Family 
and Medical Leave Act of 1993 shall be ap-
plied by inserting ‘or any reason for leave 
described in section 5102(a) of the Families 
First Coronavirus Response Act, or the em-
ployee is seeking or awaiting the results of 
a diagnostic test for, or a medical diagnosis 
of, COVID–19 and such employee has been 
exposed to COVID–19 or the employee’s em-
ployer has requested such test or diagnosis,
421 
† HR 1319 EAS 
or the employee is obtaining immunization 
related to COVID–19 or recovering from 
any injury, disability, illness, or condition 
related to such immunization’ after ‘public 
health emergency’, and 
‘‘(ii) section 110(b) of such Act shall be 
applied— 
‘‘(I) without regard to paragraph 
(1) thereof, 
‘‘(II) by striking ‘after taking 
leave after such section for 10 days’ in 
paragraph (2)(A) thereof, and 
‘‘(III) by substituting ‘$12,000’ 
for ‘$10,000’ in paragraph (2)(B)(ii) 
thereof. 
‘‘(B) LEAVE MUST MEET REQUIREMENTS.— 
For purposes of determining whether wages 
would be required to be paid under paragraph 
(1), if an employer fails to comply with any re-
quirement of the Family and Medical Leave Act 
of 1993 or the Emergency Family and Medical 
Leave Expansion Act (determined without re-
gard to any time limitation under section 
102(a)(1)(F) of the Family and Medical Leave 
Act of 1994) with respect to any leave provided
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† HR 1319 EAS 
for a qualifying need related to a public health 
emergency (as defined in section 110 of such Act, 
applied as described in subparagraph (A)(i)), 
amounts paid by such employer with respect to 
such leave shall not be taken into account as 
qualified family leave wages. For purposes of the 
preceding sentence, an employer which takes an 
action described in section 105 of the Family 
and Medical Leave Act of 1993 shall be treated 
as failing to meet a requirement of such Act. 
‘‘(d) ALLOWANCE OF CREDIT FOR CERTAIN HEALTH 
PLAN EXPENSES.— 
‘‘(1) IN GENERAL.—The amount of the credit al-
lowed under subsection (a) shall be increased by so 
much of the employer’s qualified health plan expenses 
as are properly allocable to the qualified family leave 
wages for which such credit is so allowed. 
‘‘(2) QUALIFIED HEALTH PLAN EXPENSES.—For 
purposes of this subsection, the term ‘qualified health 
plan expenses’ means amounts paid or incurred by 
the employer to provide and maintain a group health 
plan (as defined in section 5000(b)(1)), but only to 
the extent that such amounts are excluded from the 
gross income of employees by reason of section 106(a).
423 
† HR 1319 EAS 
‘‘(3) ALLOCATION RULES.—For purposes of this 
section, qualified health plan expenses shall be allo-
cated to qualified family leave wages in such manner 
as the Secretary may prescribe. Except as otherwise 
provided by the Secretary, such allocation shall be 
treated as properly made if made on the basis of 
being pro rata among covered employees and pro rata 
on the basis of periods of coverage (relative to the 
time periods of leave to which such wages relate). 
‘‘(e) ALLOWANCE
OF CREDIT
FOR AMOUNTS PAID 
UNDER
CERTAIN
COLLECTIVELY
BARGAINED
AGREE-
MENTS.— 
‘‘(1) IN GENERAL.—The amount of the credit al-
lowed under subsection (a) shall be increased by so 
much of the sum of— 
‘‘(A) so much of the employer’s collectively 
bargained defined benefit pension plan contribu-
tions as are properly allocable to the qualified 
family leave wages for which such credit is so al-
lowed, plus 
‘‘(B) so much of the employer’s collectively 
bargained apprenticeship program contributions 
as are properly allocable to the qualified family 
leave wages for which such credit is so allowed.
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† HR 1319 EAS 
‘‘(2) COLLECTIVELY BARGAINED DEFINED BEN-
EFIT PENSION PLAN CONTRIBUTIONS.—For purposes 
of this subsection— 
‘‘(A) IN GENERAL.—The term ‘collectively 
bargained defined benefit pension plan contribu-
tions’ has the meaning given such term under 
section 3131(e)(2). 
‘‘(B) ALLOCATION RULES.—The amount of 
collectively bargained defined benefit pension 
plan contributions allocated to qualified family 
leave wages for any calendar quarter shall be the 
product of— 
‘‘(i) the pension contribution rate (as 
defined in section 3131(e)(2)), expressed as 
an hourly rate, and 
‘‘(ii) the number of hours for which 
qualified family leave wages were provided 
to employees covered under the collective 
bargaining agreement described in section 
3131(e)(2)(A)(iii) during the calendar quar-
ter. 
‘‘(3) COLLECTIVELY
BARGAINED
APPRENTICE-
SHIP
PROGRAM
CONTRIBUTIONS.—For purposes of 
this section—
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† HR 1319 EAS 
‘‘(A) IN GENERAL.—The term ‘collectively 
bargained apprenticeship program contributions’ 
has the meaning given such term under section 
3131(e)(3). 
‘‘(B) ALLOCATION RULES.—For purposes of 
this section, the amount of collectively bargained 
apprenticeship program contributions allocated 
to qualified family leave wages for any calendar 
quarter shall be the product of— 
‘‘(i) the apprenticeship contribution 
rate (as defined in section 3131(e)(3)), ex-
pressed as an hourly rate, and 
‘‘(ii) the number of hours for which 
qualified family leave wages were provided 
to employees covered under the collective 
bargaining agreement described in section 
3131(e)(3)(A)(iii) during the calendar quar-
ter. 
‘‘(f) DEFINITIONS AND SPECIAL RULES.— 
‘‘(1) APPLICABLE
EMPLOYMENT
TAXES.—For 
purposes of this section, the term ‘applicable employ-
ment taxes’ means the following: 
‘‘(A) The taxes imposed under section 
3111(b).
426 
† HR 1319 EAS 
‘‘(B) So much of the taxes imposed under 
section 3221(a) as are attributable to the rate in 
effect under section 3111(b). 
‘‘(2) WAGES.—For purposes of this section, the 
term ‘wages’ means wages (as defined in section 
3121(a), determined without regard to paragraphs (1) 
through (22) of section 3121(b)) and compensation 
(as defined in section 3231(e), determined without re-
gard to the sentence in paragraph (1) thereof which 
begins ‘Such term does not include remuneration’). 
‘‘(3) DENIAL OF DOUBLE BENEFIT.—For pur-
poses of chapter 1, the gross income of the employer, 
for the taxable year which includes the last day of 
any calendar quarter with respect to which a credit 
is allowed under this section, shall be increased by the 
amount of such credit. Any wages taken into account 
in determining the credit allowed under this section 
shall not be taken into account for purposes of deter-
mining the credit allowed under sections 45A, 45P, 
45S, 51, 3131, and 3134. In the case of any credit al-
lowed under section 2301 of the CARES Act or sec-
tion 41 with respect to wages taken into account 
under this section, the credit allowed under this sec-
tion shall be reduced by the portion of the credit al-
427 
† HR 1319 EAS 
lowed under such section 2301 or section 41 which is 
attributable to such wages. 
‘‘(4) ELECTION TO NOT TAKE CERTAIN WAGES 
INTO ACCOUNT.—This section shall not apply to so 
much of the qualified family leave wages paid by an 
eligible employer as such employer elects (at such 
time and in such manner as the Secretary may pre-
scribe) to not take into account for purposes of this 
section. 
‘‘(5) CERTAIN GOVERNMENTAL EMPLOYERS.—No 
credit shall be allowed under this section to the Gov-
ernment of the United States or to any agency or in-
strumentality thereof. The preceding sentence shall 
not apply to any organization described in section 
501(c)(1) and exempt from tax under section 501(a). 
‘‘(6) EXTENSION
OF
LIMITATION
ON
ASSESS-
MENT.—Notwithstanding section 6501, the limitation 
on the time period for the assessment of any amount 
attributable to a credit claimed under this section 
shall not expire before the date that is 5 years after 
the later of— 
‘‘(A) the date on which the original return 
which includes the calendar quarter with respect 
to which such credit is determined is filed, or
428 
† HR 1319 EAS 
‘‘(B) the date on which such return is treat-
ed as filed under section 6501(b)(2). 
‘‘(7) 
COORDINATION
WITH
CERTAIN
PRO-
GRAMS.— 
‘‘(A) IN GENERAL.—This section shall not 
apply to so much of the qualified family leave 
wages paid by an eligible employer as are taken 
into account as payroll costs in connection 
with— 
‘‘(i) a covered loan under section 
7(a)(37) or 7A of the Small Business Act, 
‘‘(ii) a grant under section 324 of the 
Economic Aid to Hard-Hit Small Busi-
nesses, Non-Profits, and Venues Act, or 
‘‘(iii) a restaurant revitalization grant 
under section 5003 of the American Rescue 
Plan Act of 2021. 
‘‘(B) APPLICATION WHERE PPP LOANS NOT 
FORGIVEN.—The Secretary shall issue guidance 
providing that payroll costs paid during the cov-
ered period shall not fail to be treated as quali-
fied family leave wages under this section by 
reason of subparagraph (A)(i) to the extent 
that—