146 
quently so designated by the President, and transferred 
pursuant to transfer authorities provided by this Act shall 
retain such designation. 
SEC. 11007. (a) Any contract or agreement entered 
into by an agency with a State or local government or any 
other non-Federal entity for the purposes of providing cov-
ered assistance, including any information and documents 
related to the performance of and compliance with such 
contract or agreement, shall be— 
(1) deemed an agency record for purposes of 
section 552(f)(2) of title 5, United States Code; and 
(2) subject to section 552 of title 5, United 
States Code (commonly known as the ‘‘Freedom of 
Information Act’’). 
(b) In this section— 
(1) the term ‘‘agency’’ has the meaning given 
the term in section 551 of title 5, United States 
Code; and 
(2) the term ‘‘covered assistance’’— 
(A) means any assistance provided by an 
agency in accordance with an Act or amend-
ments made by an Act to provide aid, assist-
ance, or funding related to the outbreak of 
COVID–19 that is enacted before, on, or after 
the date of enactment of this Act; and 
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147 
(B) includes any such assistance made 
available by an agency under— 
(i) this Act; 
(ii) the Paycheck Protection Program 
and Health Care Enhancement Act (Public 
Law 116–139), or an amendment made by 
that Act; 
(iii) the CARES Act (Public Law 
116–136), or an amendment made by that 
Act; 
(iv) the Families First Coronavirus 
Response Act (Public Law 116–127), or an 
amendment made by that Act; or 
(v) the Coronavirus Preparedness and 
Response 
Supplemental 
Appropriations 
Act, 2020 (Public Law 116–123), or an 
amendment made by that Act. 
SEC. 11008. (a) Notwithstanding any other provision 
of law and in a manner consistent with other provisions 
in any division of this Act, all laborers and mechanics em-
ployed by contractors and subcontractors on projects fund-
ed directly by or assisted in whole or in part by and 
through the Federal Government pursuant to any division 
of this Act shall be paid wages at rates not less than those 
prevailing on projects of a character similar in the locality 
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148 
as determined by the Secretary of Labor in accordance 
with subchapter IV of chapter 31 of title 40, United States 
Code. With respect to the labor standards specified in this 
section, the Secretary of Labor shall have the authority 
and functions set forth in Reorganization Plan Numbered 
14 of 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 
3145 of title 40, United States Code. 
(b) The amounts provided by this section are des-
ignated by the Congress as being for an emergency re-
quirement pursuant to section 251(b)(2)(A)(i) of the Bal-
anced Budget and Emergency Deficit Control Act of 1985. 
BUDGETARY EFFECTS 
SEC. 11009. (a) STATUTORY PAYGO EMERGENCY 
DESIGNATION.—The amounts provided under division B 
and each succeeding division are designated as an emer-
gency requirement pursuant to section 4(g) of the Statu-
tory Pay-As-You-Go Act of 2010 (2 U.S.C. 933(g)). 
(b) SENATE PAYGO EMERGENCY DESIGNATION.— 
In the Senate, division B and each succeeding division are 
designated as an emergency requirement pursuant to sec-
tion 4112(a) of H. Con. Res. 71 (115th Congress), the 
concurrent resolution on the budget for fiscal year 2018. 
(c) CLASSIFICATION
OF BUDGETARY EFFECTS.— 
Notwithstanding Rule 3 of the Budget Scorekeeping 
Guidelines set forth in the joint explanatory statement of 
the committee of conference accompanying Conference Re-
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149 
port 105–217 and section 250(c)(8) of the Balanced 
Budget and Emergency Deficit Control Act of 1985, the 
budgetary effects of division B and each succeeding divi-
sion— 
(1) shall not be estimated for purposes of sec-
tion 251 of such Act; and 
(2) shall be entered on the PAYGO scorecards 
maintained pursuant to section 4(d) of the Statutory 
Pay-As-You-Go Act of 2010. 
(d) ENSURING NO WITHIN-SESSION SEQUESTRA-
TION.—Solely for the purpose of calculating a breach with-
in a category for fiscal year 2020 pursuant to section 
251(a)(6) or section 254(g) of the Balanced Budget and 
Emergency Deficit Control Act of 1985, and notwith-
standing any other provision of this division, the budg-
etary effects from this division shall be counted as 
amounts designated as being for an emergency require-
ment pursuant to section 251(b)(2)(A) of such Act. 
This division may be cited as the ‘‘Coronavirus Re-
covery Supplemental Appropriations Act, 2020’’. 
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150 
DIVISION B—REVENUE PROVISIONS 
SEC. 20001. SHORT TITLE. 
This division may be cited as the ‘‘COVID–19 Tax 
Relief Act of 2020’’. 
TITLE I—ECONOMIC STIMULUS 
Subtitle A—2020 Recovery Rebate Improvements 
SEC. 20101. DEPENDENTS TAKEN INTO ACCOUNT IN DETER-
MINING CREDIT AND REBATES. 
(a) IN GENERAL.—Section 6428(a)(2) of the Internal 
Revenue Code of 1986 is amended by striking ‘‘qualifying 
children (within the meaning of section 24(c))’’ and insert-
ing ‘‘dependents (as defined in section 152)’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 6428(g) of such Code is amended 
by striking ‘‘qualifying child’’ each place it appears 
and inserting ‘‘dependent’’. 
(2) Section 6428(g)(2)(B) of such Code is 
amended by striking ‘‘such child’’ and inserting 
‘‘such dependent’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect as if included in section 2201 
of the CARES Act. 
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151 
SEC. 20102. INDIVIDUALS PROVIDING TAXPAYER IDENTI-
FICATION NUMBERS TAKEN INTO ACCOUNT 
IN DETERMINING CREDIT AND REBATES. 
(a) IN GENERAL.—Section 6428(g) of the Internal 
Revenue Code of 1986, as amended by section 20101 of 
this Act, is amended to read as follows: 
‘‘(g) IDENTIFICATION NUMBER REQUIREMENT.— 
‘‘(1) IN GENERAL.—The $1,200 amount in sub-
section (a)(1) shall be treated as being zero unless 
the taxpayer includes the TIN of the taxpayer on 
the return of tax for the taxable year. 
‘‘(2) JOINT RETURNS.—In the case of a joint 
return, the $2,400 amount in subsection (a)(1) shall 
be treated as being— 
‘‘(A) zero if the TIN of neither spouse is 
included on the return of tax for the taxable 
year, and 
‘‘(B) $1,200 if the TIN of only one spouse 
is so included. 
‘‘(3) DEPENDENTS.—A dependent shall not be 
taken into account under subsection (a)(2) unless 
the TIN of such dependent is included on the return 
of tax for the taxable year. 
‘‘(4) COORDINATION WITH CERTAIN ADVANCE 
PAYMENTS.—In the case of any payment made pur-
suant to subsection (f)(5)(B), a TIN shall be treated 
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152 
for purposes of this subsection as included on the 
taxpayer’s return of tax if such TIN is provided pur-
suant to such subsection. 
‘‘(5) MATHEMATICAL OR CLERICAL ERROR AU-
THORITY.—Any omission of a correct TIN required 
under this subsection shall be treated as a mathe-
matical or clerical error for purposes of applying sec-
tion 6213(g)(2) to such omission.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall take effect as if included in section 2201 
of the CARES Act. 
SEC. 20103. 2020 RECOVERY REBATES NOT SUBJECT TO RE-
DUCTION OR OFFSET WITH RESPECT TO 
PAST-DUE SUPPORT. 
(a) IN GENERAL.—Section 2201(d)(2) of the CARES 
Act is amended by inserting ‘‘(c),’’ before ‘‘(d)’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to credits and refunds allowed or 
made after the date of the enactment of this Act. 
SEC. 20104. PROTECTION OF 2020 RECOVERY REBATES. 
(a) IN GENERAL.—Subsection (d) of section 2201 of 
the CARES Act, as amended by the preceding provisions 
of this Act, is amended— 
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153 
(1) by redesignating paragraphs (1), (2), and 
(3) as subparagraphs (A), (B), and (C), and by mov-
ing such subparagraphs 2 ems to the right, 
(2) by striking ‘‘REDUCTION OR OFFSET.—Any 
credit’’ and inserting ‘‘REDUCTION, OFFSET, GAR-
NISHMENT, ETC.— 
‘‘(1) IN GENERAL.—Any credit’’, and 
(3) by adding at the end the following new 
paragraphs: 
‘‘(2) ASSIGNMENT OF BENEFITS.— 
‘‘(A) IN
GENERAL.—Any applicable pay-
ment shall not be subject to transfer, assign-
ment, execution, levy, attachment, garnishment, 
or other legal process, or the operation of any 
bankruptcy or insolvency law, to the same ex-
tent as payments described in section 207 of 
the Social Security Act (42 U.S.C. 407) without 
regard to subsection (b) thereof. 
‘‘(B) ENCODING OF PAYMENTS.—As soon 
as practicable after the date of the enactment 
of this paragraph, the Secretary of the Treas-
ury shall encode applicable payments that are 
paid electronically to any account— 
‘‘(i) with a unique identifier that is 
reasonably sufficient to allow a financial 
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154 
institution to identify the payment as a 
payment protected under subparagraph 
(A), and 
‘‘(ii) pursuant to the same specifica-
tions as required for a benefit payment to 
which part 212 of title 31, Code of Federal 
regulations applies. 
‘‘(C) GARNISHMENT.— 
‘‘(i) ENCODED PAYMENTS.—Upon re-
ceipt of a garnishment order that applies 
to an account that has received an applica-
ble payment that is encoded as provided in 
subparagraph (B), a financial institution 
shall follow the requirements and proce-
dures set forth in part 212 of title 31, 
Code of Federal Regulations. This para-
graph shall not alter the status of pay-
ments as tax refunds or other nonbenefit 
payments for purpose of any reclamation 
rights of the Department of Treasury or 
the Internal Revenue Service as per part 
210 of title 31 of the Code of Federal Reg-
ulations. 
‘‘(ii) OTHER PAYMENTS.—If a finan-
cial institution receives a garnishment 
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order (other than an order that has been 
served by the United States) that applies 
to an account into which an applicable 
payment that has not been encoded as pro-
vided in subparagraph (B) has been depos-
ited on any date in the prior 60 days (in-
cluding any date before the date of the en-
actment of this paragraph), the financial 
institution, upon the request of the account 
holder or for purposes of complying in 
good faith with a State order, State law, 
court order, or interpretation by a State 
Attorney General relating to garnishment 
order, may, but is not required to, treat 
the amount of the payment as exempt 
under law from garnishment without re-
quiring the account holder to assert any 
right of garnishment exemption or requir-
ing the consent of the judgment creditor. 
‘‘(iii) LIABILITY.—A financial institu-
tion that complies in good faith with clause 
(i) or that acts in good faith in reliance on 
clause (ii) shall not be liable under any 
Federal or State law, regulation, or court 
or other order to a creditor that initiates 
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156 
an order for any protected amounts, to an 
account holder for any frozen amounts or 
garnishment order applied. 
‘‘(D) DEFINITIONS.—For purposes of this 
paragraph— 
‘‘(i) ACCOUNT
HOLDER.—The term 
‘account holder’ means a natural person 
against whom a garnishment order is 
issued and whose name appears in a finan-
cial institution’s records. 
‘‘(ii) 
APPLICABLE
PAYMENT.—The 
term ‘applicable payment’ means any pay-
ment of credit or refund by reason of sec-
tion 6428 of such Code (as so added) or by 
reason of subsection (c) of this section. 
‘‘(iii) GARNISHMENT.—The term ‘gar-
nishment’ means execution, levy, attach-
ment, garnishment, or other legal process. 
‘‘(iv) 
GARNISHMENT
ORDER.—The 
term ‘garnishment order’ means a writ, 
order, notice, summons, judgment, levy, or 
similar written instruction issued by a 
court, a State or State agency, a munici-
pality or municipal corporation, or a State 
child support enforcement agency, includ-
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157 
ing a lien arising by operation of law for 
overdue child support or an order to freeze 
the assets in an account, to effect a gar-
nishment against a debtor.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the date of the enactment 
of this Act. 
SEC. 20105. PAYMENTS TO REPRESENTATIVE PAYEES AND 
FIDUCIARIES. 
(a) IN GENERAL.—Section 6428(f) of the Internal 
Revenue Code of 1986 is amended by redesignating para-
graph (6) as paragraph (7) and by inserting after para-
graph (5) the following new paragraph: 
‘‘(6) PAYMENT
TO
REPRESENTATIVE
PAYEES 
AND FIDUCIARIES.— 
‘‘(A) IN GENERAL.—In the case of any in-
dividual for which payment information is pro-
vided to the Secretary by the Commissioner of 
Social Security, the Railroad Retirement Board, 
or the Secretary of Veterans Affairs, the pay-
ment by the Secretary under paragraph (3) 
with respect to such individual may be made to 
such individual’s representative payee or fidu-
ciary and the entire payment shall be— 
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158 
‘‘(i) provided to the individual who is 
entitled to the payment, or 
‘‘(ii) used only for the benefit of the 
individual who is entitled to the payment. 
‘‘(B) 
APPLICATION
OF
ENFORCEMENT 
PROVISIONS.— 
‘‘(i) In the case of a payment de-
scribed in subparagraph (A) which is made 
with respect to a social security beneficiary 
or a supplemental security income recipi-
ent, section 1129(a)(3) of the Social Secu-
rity Act (42 U.S.C. 1320a–8(a)(3)) shall 
apply to such payment in the same manner 
as such section applies to a payment under 
title II or XVI of such Act. 
‘‘(ii) In the case of a payment de-
scribed in subparagraph (A) which is made 
with respect to a railroad retirement bene-
ficiary, section 13 of the Railroad Retire-
ment Act (45 U.S.C. 231l) shall apply to 
such payment in the same manner as such 
section applies to a payment under such 
Act. 
‘‘(iii) In the case of a payment de-
scribed in subparagraph (A) which is made 
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159 
with respect to a veterans beneficiary, sec-
tions 5502, 6106, and 6108 of title 38, 
United States Code, shall apply to such 
payment in the same manner as such sec-
tions apply to a payment under such 
title.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall take effect as if included in section 2201 
of the CARES Act. 
SEC. 20106. APPLICATION TO TAXPAYERS WITH RESPECT 
TO WHOM ADVANCE PAYMENT HAS ALREADY 
BEEN MADE. 
In the case of any taxpayer with respect to whom re-
fund or credit was made or allowed before the date of the 
enactment of this Act under subsection (f) of section 6428 
of the Internal Revenue Code of 1986 (as added by the 
CARES Act), such subsection shall be applied separately 
with respect to the excess (if any) of— 
(1) the advance refund amount determined 
under section 6428(f)(2) of such Code after the ap-
plication of the amendments made by this subtitle, 
over 
(2) the amount of such refund or credit so 
made or allowed. 
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160 
Subtitle B—Additional Recovery Rebates to Individuals 
SEC. 20111. ADDITIONAL RECOVERY REBATES TO INDIVID-
UALS. 
(a) IN GENERAL.—Subchapter B of chapter 65 of the 
Internal Revenue Code of 1986 is amended by inserting 
after section 6428 the following new section: 
‘‘SEC. 6428A. ADDITIONAL RECOVERY REBATES TO INDIVID-
UALS. 
‘‘(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 2020 an amount equal to the additional rebate amount 
determined for such taxable year. 
‘‘(b) ADDITIONAL REBATE AMOUNT.—For purposes 
of this section, the term ‘additional rebate amount’ means, 
with respect to any taxpayer for any taxable year, the sum 
of— 
‘‘(1) $1,200 ($2,400 in the case of a joint re-
turn), plus 
‘‘(2) $1,200 multiplied by the number of de-
pendents of the taxpayer for such taxable year (not 
in excess of 3 such dependents). 
‘‘(c) ELIGIBLE INDIVIDUAL.—For purposes of this 
section, the term ‘eligible individual’ means any individual 
other than— 
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‘‘(1) any nonresident alien individual, 
‘‘(2) any individual with respect to whom a de-
duction under section 151 is allowable to another 
taxpayer for a taxable year beginning in the cal-
endar year in which the individual’s taxable year be-
gins, and 
‘‘(3) an estate or trust. 
‘‘(d) LIMITATION BASED ON MODIFIED ADJUSTED 
GROSS INCOME.—The amount of the credit allowed by 
subsection (a) (determined without regard to this sub-
section and subsection (f)) shall be reduced (but not below 
zero) by 5 percent of so much of the taxpayer’s modified 
adjusted gross income as exceeds— 
‘‘(1) $150,000 in the case of a joint return or 
a surviving spouse (as defined in section 2(a)), 
‘‘(2) $112,500 in the case of a head of house-
hold (as defined in section 2(b)), and 
‘‘(3) $75,000 in any other case. 
‘‘(e) DEFINITIONS AND SPECIAL RULES.— 
‘‘(1) MODIFIED
ADJUSTED
GROSS
INCOME.— 
For purposes of this subsection (other than this 
paragraph), the term ‘modified adjusted gross in-
come’ means adjusted gross income determined with-
out regard to sections 911, 931, and 933. 
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162 
‘‘(2) DEPENDENT DEFINED.—For purposes of 
this section, the term ‘dependent’ has the meaning 
given such term by section 152. 
‘‘(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. 
‘‘(4) 
IDENTIFICATION
NUMBER
REQUIRE-
MENT.— 
‘‘(A) IN GENERAL.—The $1,200 amount in 
subsection (b)(1) shall be treated as being zero 
unless the taxpayer includes the TIN of the 
taxpayer on the return of tax for the taxable 
year. 
‘‘(B) JOINT RETURNS.—In the case of a 
joint return, the $2,400 amount in subsection 
(b)(1) shall be treated as being— 
‘‘(i) zero if the TIN of neither spouse 
is included on the return of tax for the 
taxable year, and 
‘‘(ii) $1,200 if the TIN of only one 
spouse is so included. 
‘‘(C) DEPENDENTS.—A dependent shall 
not be taken into account under subsection 
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163 
(b)(2) unless the TIN of such dependent is in-
cluded on the return of tax for the taxable year. 
‘‘(D) COORDINATION
WITH
CERTAIN
AD-
VANCE PAYMENTS.—In the case of any payment 
made pursuant to subsection (g)(5)(A)(ii), a 
TIN shall be treated for purposes of this para-
graph as included on the taxpayer’s return of 
tax if such TIN is provided pursuant to such 
subsection. 
‘‘(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 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.—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-
it shall be treated as having been made or allowed 
to each individual filing such return. 
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164 
‘‘(g) ADVANCE REFUNDS AND CREDITS.— 
‘‘(1) IN GENERAL.—Subject to paragraph (5), 
each individual who was an eligible individual for 
such individual’s first taxable year beginning in 
2019 shall be treated as having made a payment 
against the tax imposed by chapter 1 for such tax-
able year in an amount equal to the advance refund 
amount for such taxable year. 
‘‘(2) ADVANCE
REFUND
AMOUNT.—For pur-
poses of paragraph (1), the advance refund amount 
is the amount that would have been allowed as a 
credit under this section for such taxable year if this 
section (other than subsection (f) and this sub-
section) had applied to such taxable year. 
‘‘(3) TIMING AND MANNER OF PAYMENTS.— 
‘‘(A) TIMING.—The Secretary shall, sub-
ject to the provisions of this title, refund or 
credit any overpayment attributable to this sec-
tion as rapidly as possible. No refund or credit 
shall be made or allowed under this subsection 
after December 31, 2020. 
‘‘(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 any ac-
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165 
count to which the payee authorized, on or after 
January 1, 2018, the delivery of a refund of 
taxes under this title or of a Federal payment 
(as defined in section 3332 of title 31, United 
States Code). 
‘‘(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 sections 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 sec-
tion. 
‘‘(5) APPLICATION
TO
INDIVIDUALS
WHO
DO 
NOT FILE A RETURN OF TAX FOR 2019.— 
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166 
‘‘(A) IN GENERAL.—In the case of an indi-
vidual who, at the time of any determination 
made pursuant to paragraph (3), has not filed 
a tax return for the year described in para-
graph (1), the Secretary shall— 
‘‘(i) apply paragraph (1) by sub-
stituting ‘2018’ for ‘2019’, and 
‘‘(ii) in the case of a specified indi-
vidual who has not filed a tax return for 
such individual’s first taxable year begin-
ning in 2018, determine the advance re-
fund amount with respect to such indi-
vidual without regard to subsections (d) 
and on the basis of information with re-
spect to such individual which is provided 
by— 
‘‘(I) in the case of a specified so-
cial security beneficiary or a specified 
supplemental security income recipi-
ent, the Commissioner of Social Secu-
rity, 
‘‘(II) in the case of a specified 
railroad retirement beneficiary, the 
Railroad Retirement Board, and 
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167 
‘‘(III) in the case of a specified 
veterans beneficiary, the Secretary of 
Veterans 
Affairs 
(in 
coordination 
with, and with the assistance of, the 
Commissioner of Social Security if ap-
propriate). 
‘‘(B) SPECIFIED
INDIVIDUAL.—For pur-
poses of this paragraph, the term ‘specified in-
dividual’ means any individual who is— 
‘‘(i) a specified social security bene-
ficiary, 
‘‘(ii) a specified supplemental security 
income recipient, 
‘‘(iii) a specified railroad retirement 
beneficiary, or 
‘‘(iv) a specified veterans beneficiary. 
‘‘(C) SPECIFIED SOCIAL SECURITY BENE-
FICIARY.—For purposes of this paragraph— 
‘‘(i) IN GENERAL.—The term ‘speci-
fied social security beneficiary’ means any 
individual who, for the last month that 
ends prior to the date of enactment of this 
section, is entitled to any monthly insur-
ance benefit payable under title II of the 
Social Security Act (42 U.S.C. 401 et 
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168 
seq.), including payments made pursuant 
to sections 202(d), 223(g), and 223(i)(7) 
of such Act. 
‘‘(ii) EXCEPTION.—Such term shall 
not include any individual if such benefit is 
not payable for such month by reason of 
section 202(x) of the Social Security Act 
(42 U.S.C. 402(x)) or section 1129A of 
such Act (42 U.S.C. 1320a–8a). 
‘‘(D) SPECIFIED
SUPPLEMENTAL
SECU-
RITY INCOME RECIPIENT.—For purposes of this 
paragraph— 
‘‘(i) IN GENERAL.—The term ‘speci-
fied supplemental security income recipi-
ent’ means any individual who, for the last 
month that ends prior to the date of enact-
ment of this section, is eligible for a 
monthly benefit payable under title XVI of 
the Social Security Act (42 U.S.C. 1381 et 
seq.) (other than a benefit to an individual 
described in section 1611(e)(1)(B) of such 
Act (42 U.S.C. 1382(e)(1)(B)), includ-
ing— 
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174 
6108 of title 38, United States Code, 
shall apply to such payment in the 
same manner as such sections apply 
to a payment under such title. 
‘‘(6) NOTICE TO TAXPAYER.—Not later than 15 
days 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 
shall indicate the method by which such payment 
was made, the amount of such payment, and a 
phone number for the appropriate point of contact 
at the Internal Revenue Service to report any error 
with respect to such payment. 
‘‘(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 
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175 
‘‘(2) regulations or other guidance providing for 
the proper treatment of joint returns and taxpayers 
with dependents to ensure that an individual is not 
taken into account more than once in determining 
the amount of any credit under subsection (a) and 
any credit or refund under subsection (g). 
‘‘(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.— 
(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 
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176 
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) COORDINATION
WITH
CREDIT
ALLOWED 
AGAINST UNITED STATES INCOME TAXES.—No cred-
it shall be allowed against United States income 
taxes under section 6428A 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— 
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177 
(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). 
(4) 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. 
(c) ADMINISTRATIVE PROVISIONS.— 
(1) 
DEFINITION
OF
DEFICIENCY.—Section 
6211(b)(4)(A) of the Internal Revenue Code of 1986 
is amended by striking ‘‘and 6428’’ and inserting 
‘‘6428, and 6428A’’. 
(2) MATHEMATICAL OR CLERICAL ERROR AU-
THORITY.—Section 6213(g)(2) of such Code is 
amended— 
(A) by inserting ‘‘or section 6428A (relat-
ing to additional recovery rebates to individ-
uals)’’ before the comma at the end of subpara-
graph (H), and 
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178 
(B) by striking ‘‘or 6428’’ in subparagraph 
(L) and inserting ‘‘6428, or 6428A’’. 
(3) EXCEPTION
FROM
REDUCTION
OR
OFF-
SET.—Any credit or refund allowed or made to any 
individual by reason of section 6428A of the Internal 
Revenue Code of 1986 (as added by this section) or 
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. 
(4) ASSIGNMENT OF BENEFITS.— 
(A) IN
GENERAL.—Any applicable pay-
ment shall not be subject to transfer, assign-
ment, execution, levy, attachment, garnishment, 
or other legal process, or the operation of any 
bankruptcy or insolvency law, to the same ex-
tent as payments described in section 207 of 
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179 
the Social Security Act (42 U.S.C. 407) without 
regard to subsection (b) thereof. 
(B) ENCODING OF PAYMENTS.—As soon as 
practicable after the date of the enactment of 
the paragraph, the Secretary of the Treasury 
shall encode applicable payments that are paid 
electronically to any account— 
(i) with a unique identifier that is rea-
sonably sufficient to allow a financial insti-
tution to identify the payment as a pay-
ment protected under subparagraph (A), 
and 
(ii) pursuant to the same specifica-
tions as required for a benefit payment to 
which part 212 of title 31, Code of Federal 
regulations applies. 
(C) GARNISHMENT.— 
(i) ENCODED
PAYMENTS.—Upon re-
ceipt of a garnishment order that applies 
to an account that has received an applica-
ble payment that is encoded as provided in 
subparagraph (B), a financial institution 
shall follow the requirements and proce-
dures set forth in part 212 of title 31, 
Code of Federal Regulations. This para-
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180 
graph shall not alter the status of pay-
ments as tax refunds or other nonbenefit 
payments for purpose of any reclamation 
rights of the Department of Treasury or 
the Internal Revenue Serves as per part 
210 of title 31 of the Code of Federal Reg-
ulations. 
(ii) OTHER PAYMENTS.—If a financial 
institution receives a garnishment order 
(other than an order that has been served 
by the United States) that applies to an 
account into which an applicable payment 
that has not been encoded as provided in 
subparagraph (B) has been deposited on 
any date in the prior 60 days (including 
any date before the date of the enactment 
of this paragraph), the financial institu-
tion, upon the request of the account hold-
er or for purposes of complying in good 
faith with a State order, State law, court 
order, or interpretation by a State Attor-
ney General relating to garnishment order, 
may, but is not required to, treat the 
amount of the payment as exempt under 
law from garnishment without requiring 
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181 
the account holder to assert any right of 
garnishment exemption or requiring the 
consent of the judgment creditor. 
(iii) LIABILITY.—A financial institu-
tion that complies in good faith with clause 
(i) or that acts in good faith in reliance on 
clause (ii) shall not be liable under any 
Federal or State law, regulation, or court 
or other order to a creditor that initiates 
an order for any protected amounts, to an 
account holder for any frozen amounts or 
garnishment order applied. 
(D) DEFINITIONS.—For purposes of this 
paragraph— 
(i) ACCOUNT
HOLDER.—The term 
‘‘account holder’’ means a natural person 
against whom a garnishment order is 
issued and whose name appears in a finan-
cial institution’s records. 
(ii) 
APPLICABLE
PAYMENT.—The 
term ‘‘applicable payment’’ means any pay-
ment of credit or refund by reason of sec-
tion 6428 of such Code (as so added) or by 
reason of subsection (c) of this section. 
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182 
(iii) GARNISHMENT.—The term ‘‘gar-
nishment’’ means execution, levy, attach-
ment, garnishment, or other legal process. 
(iv) 
GARNISHMENT
ORDER.—The 
term ‘‘garnishment order’’ means a writ, 
order, notice, summons, judgment, levy, or 
similar written instruction issued by a 
court, a State or State agency, a munici-
pality or municipal corporation, or a State 
child support enforcement agency, includ-
ing a lien arising by operation of law for 
overdue child support or an order to freeze 
the assets in an account, to effect a gar-
nishment against a debtor. 
(5) TREATMENT OF CREDIT AND ADVANCE PAY-
MENTS.—For purposes of section 1324 of title 31, 
United States Code, any credit under section 
6428A(a) of the Internal Revenue Code of 1986, any 
credit or refund under section 6428A(g) of such 
Code, and any payment under subsection (b) of this 
section, shall be treated in the same manner as a re-
fund due from a credit provision referred to in sub-
section (b)(2) of such section 1324. 
(6) AGENCY INFORMATION SHARING AND AS-
SISTANCE.—The Commissioner of Social Security, 
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183 
the Railroad Retirement Board, and the Secretary of 
Veterans Affairs shall each provide the Secretary of 
the Treasury (or the Secretary’s delegate) such in-
formation and assistance as the Secretary of the 
Treasury (or the Secretary’s delegate) may require 
for purposes of making payments under section 
6428A(g) of the Internal Revenue Code of 1986 to 
individuals described in paragraph (5)(A)(ii) thereof. 
(7) CLERICAL AMENDMENT.—The table of sec-
tions for subchapter B of chapter 65 of the Internal 
Revenue Code of 1986 is amended by inserting after 
the item relating to section 6428 the following new 
item: 
‘‘Sec. 6428A. Additional recovery rebates to individuals.’’. 
(d) APPROPRIATIONS
TO CARRY OUT THIS SEC-
TION.— 
(1) IN GENERAL.—Immediately upon the enact-
ment of this Act, the following sums are appro-
priated, out of any money in the Treasury not other-
wise appropriated, for the fiscal year ending Sep-
tember 30, 2020— 
(A) DEPARTMENT OF THE TREASURY.— 
(i) For an additional amount for ‘‘De-
partment of the Treasury—Bureau of Fis-
cal Services—Salaries and Expenses’’, 
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184 
$78,650,000, to remain available until 
September 30, 2021. 
(ii) For an additional amount for 
‘‘Department of the Treasury—Internal 
Revenue 
Service—Taxpayer 
Services’’, 
$298,700,000, to remain available until 
September 30, 2021. 
(iii) For an additional amount for 
‘‘Department of the Treasury—Internal 
Revenue 
Service—Enforcement’’, 
$37,200,000, to remain available until 
September 30, 2021. 
(iv) For an additional amount for 
‘‘Department of the Treasury—Internal 
Revenue Service—Operations Support’’, 
$185,000,000, to remain available until 
September 30, 2021. 
(v) For an additional amount for ‘‘De-
partment of the Treasury—Office of 
Treasury Inspector General for Tax Ad-
ministration’’, $10,000,000, to remain 
available until September 30, 2024, for 
necessary expenses related to COVID–19 
including carrying out investigations. 
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185 
Amounts made available in appropriations 
under clauses (ii), (iii), and (iv) of this subpara-
graph may be transferred between such appro-
priations upon the advance notification of the 
Committees on Appropriations of the House of 
Representatives and the Senate. Such transfer 
authority is in addition to any other transfer 
authority provided by law. 
(B) SOCIAL SECURITY ADMINISTRATION.— 
For an additional amount for ‘‘Social Security 
Administration—Limitation on Administrative 
Expenses’’, $40,500,000, to remain available 
until September 30, 2021: Provided, that 
$2,500,000, to remain available until Sep-
tember 30, 2024, shall be transferred to ‘‘Social 
Security Administration—Office of Inspector 
General’’ for necessary expenses in carrying out 
the provisions of the Inspector General Act of 
1978. 
(C) RAILROAD RETIREMENT BOARD.—For 
an additional amount for ‘‘Railroad Retirement 
Board—Limitation on Administration’’, $8,300, 
to remain available until September 30, 2021. 
(2) REPORTS.—No later than 15 days after en-
actment of this Act, the Secretary of the Treasury 
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186 
shall submit a plan to the Committees on Appropria-
tions of the House of Representatives and the Sen-
ate detailing the expected use of the funds provided 
by clauses (i) through (iv) paragraph (1)(A). Begin-
ning 90 days after enactment of this Act, the Sec-
retary of the Treasury shall submit a quarterly re-
port to the Committees on Appropriations of the 
House of Representatives and the Senate detailing 
the actual expenditure of such funds and the ex-
pected expenditure of such funds in the subsequent 
quarter. 
(e) CERTAIN REQUIREMENTS RELATED TO RECOV-
ERY REBATES AND ADDITIONAL RECOVERY REBATES.— 
(1) SIGNATURES
ON
CHECKS
AND
NOTICES, 
ETC., BY THE DEPARTMENT OF THE TREASURY.— 
Any check issued to an individual by the Depart-
ment of the Treasury pursuant to section 6428 or 
6428A of the Internal Revenue Code of 1986, and 
any notice issued pursuant to section 6428(f)(6) or 
section 6428A(g)(6) of such Code, may not be 
signed by or otherwise bear the name, signature, 
image or likeness of the President, the Vice Presi-
dent or any elected official or cabinet level officer of 
the United States, or any individual who, with re-
spect to any of the aforementioned individuals, bears 
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187 
any relationship described in subparagraphs (A) 
through (G) of section 152(d)(2) of the Internal 
Revenue Code of 1986. 
(2) EFFECTIVE
DATE.—Paragraph (1) shall 
apply to checks and notices issued after the date of 
the enactment of this Act. 
(f) REPORTS TO CONGRESS.—Each week beginning 
after the date of the enactment of this Act and beginning 
before December 31, 2020, on Friday of such week, not 
later than 3 p.m. Eastern Time, the Secretary of the 
Treasury shall provide a written report to the Committee 
on Ways and Means of the House of Representatives and 
the Committee on Finance of the Senate. Such report shall 
include the following information with respect to payments 
made pursuant to each of sections 6428 and 6428A of 
the Internal Revenue Code of 1986: 
(1) The number of scheduled payments sent to 
the Bureau of Fiscal Service for payment by direct 
deposit or paper check for the following week (stated 
separately for direct deposit and paper check). 
(2) The total dollar amount of the scheduled 
payments described in paragraph (1). 
(3) The number of direct deposit payments re-
turned to the Department of the Treasury and the 
total dollar value of such payments, for the week 
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188 
ending on the day prior to the day on which the re-
port is provided. 
(4) The total number of letters related to pay-
ments under section 6428 or 6428A of such Code 
mailed to taxpayers during the week ending on the 
day prior to the day on which the report is provided. 
Subtitle C—Earned Income Tax Credit 
SEC. 20121. STRENGTHENING THE EARNED INCOME TAX 
CREDIT FOR INDIVIDUALS WITH NO QUALI-
FYING CHILDREN. 
(a) SPECIAL RULES FOR 2020.—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, 2019, and before January 
1, 2021— 
‘‘(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— 
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189 
‘‘(i) except as otherwise provided in 
this subparagraph, age 19, 
‘‘(ii) in the case of a full-time student 
(other than a qualified former foster youth 
or a qualified homeless youth), age 25, and 
‘‘(iii) in the case of a qualified former 
foster youth or a qualified homeless youth, 
age 18. 
‘‘(C) FULL-TIME STUDENT.—For purposes 
of this paragraph, the term ‘full-time 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 a State or tribal agency admin-
istering (or eligible to administer) a plan 
under part B or part E of the Social Secu-
rity Act (without regard to whether Fed-
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190 
eral assistance was provided with respect 
to such child under such part E), and 
‘‘(ii) provides (in such manner as the 
Secretary may provide) consent for State 
and tribal agencies which administer a 
plan under part B or part E of the Social 
Security Act to disclose to the Secretary 
information 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. 
Terms used in the preceding sentence 
which are also used in section 480(d)(1) of 
the Higher Education Act of 1965 shall 
have the same meaning as when used in 
such section, and 
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191 
‘‘(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. 
‘‘(2) INCREASE IN MAXIMUM AGE FOR CRED-
IT.—Subsection (c)(1)(A)(ii)(II) shall be applied by 
substituting ‘age 66’ for ‘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 ‘$9,720’ for 
‘$4,220’, and 
‘‘(ii) by substituting ‘$11,490’ for 
‘$5,280’. 
‘‘(B) COORDINATION WITH INFLATION AD-
JUSTMENT.—Subsection (j) shall not apply to 
any dollar amount specified in this paragraph.’’. 
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192 
(b) INFORMATION RETURN MATCHING.—As soon as 
practicable, the Secretary of the Treasury (or the Sec-
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 full-time 
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, 2019. 
SEC. 20122. 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 
the date of the enactment of this Act. 
SEC. 20123. 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— 
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(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) lives 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 
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‘‘(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 
the date of the enactment of this Act. 
SEC. 20124. ELIMINATION OF DISQUALIFIED INVESTMENT 
INCOME TEST. 
(a) IN GENERAL.—Section 32 of the Internal Rev-
enue Code of 1986 is amended by striking subsection (i). 
(b) CONFORMING AMENDMENTS.— 
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(1) Section 32(j)(1) of such Code is amended 
by striking ‘‘subsections (b)(2) and (i)(1)’’ and in-
serting ‘‘subsection (b)(2)’’. 
(2) Section 32(j)(1)(B)(i) of such Code is 
amended by striking ‘‘subsections (b)(2)(A) and 
(i)(1)’’ and inserting ‘‘subsection (b)(2)(A)’’. 
(3) Section 32(j)(2) of such Code is amended— 
(A) by striking subparagraph (B), and 
(B) by striking ‘‘ROUNDING.—’’ and all 
that follows through ‘‘If any dollar amount’’ 
and inserting the following: ‘‘ROUNDING.—If 
any dollar amount’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this Act. 
SEC. 20125. 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: 
‘‘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 
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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 
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-
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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 2020.—In the 
case of calendar year 2020, the term ‘base 
amount’ means the greater of— 
‘‘(I) the cost to Puerto Rico of 
the earned income tax credit for tax-
able years beginning in or with cal-
endar year 2019 (rounded to the 
nearest multiple of $1,000,000), or 
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198 
‘‘(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— 
‘‘(i) after receipt of the report de-
scribed in subparagraph (B) for such cal-
endar year, and 
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199 
‘‘(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 
by, or to, the Secretary (as the case may 
be) as soon as practicable after the deter-
mination that such estimate was inac-
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200 
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. 
‘‘(E) PREVENTION OF MANIPULATION OF 
BASE AMOUNT.—No payments shall be made 
under paragraph (1) if the earned income tax 
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201 
credit as in effect in Puerto Rico for taxable 
years beginning in or with calendar year 2019 
is modified after the date of the enactment of 
this subsection. 
‘‘(b) POSSESSIONS WITH MIRROR CODE TAX SYS-
TEMS.— 
‘‘(1) IN GENERAL.—With respect to calendar 
year 2020 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) 75 percent of the cost to such posses-
sion of the earned income tax credit for taxable 
years beginning in or with such calendar year, 
plus 
‘‘(B) in the case of calendar years 2020 
through 2024, 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. 
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202 
‘‘(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.— 
‘‘(1) IN GENERAL.—With respect to calendar 
year 2020 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) 75 percent of the cost to Amer-
ican Samoa of the earned income tax cred-
it for taxable years beginning in or with 
such calendar year, or 
‘‘(ii) $12,000,000, plus 
‘‘(B) in the case of calendar years 2020 
through 2024, 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. 
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203 
‘‘(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 
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 2020, the $12,000,000 
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 
2019’ 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), 
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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.’’. 
(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. 7529. Application of earned income tax credit to possessions of the 
United States.’’. 
SEC. 20126. 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 
2020 is less than the earned income of the taxpayer for 
the preceding taxable year, the credit allowed under sec-
tion 32 of the Internal Revenue Code of 1986 may, at 
the election of the taxpayer, be determined by sub-
stituting-— 
(1) such earned income for the preceding tax-
able year, for 
(2) such earned income for the taxpayer’s first 
taxable year beginning in 2020. 
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205 
(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-
turn, the earned income of the taxpayer for the pre-
ceding taxable year shall be the sum of the earned 
income of each spouse for such preceding taxable 
year. 
(c) SPECIAL RULES.— 
(1) ERRORS
TREATED
AS
MATHEMATICAL 
ERROR.—For purposes of section 6213 of the Inter-
nal Revenue Code of 1986, an incorrect use on a re-
turn 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-
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206 
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 
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. 
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(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. 
(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. 
Subtitle D—Child Tax Credit 
SEC. 20131. CHILD TAX CREDIT IMPROVEMENTS FOR 2020. 
(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 2020.—In the case of any 
taxable year beginning in 2020— 
‘‘(1) REFUNDABLE CREDIT.—Subsection (h)(5) 
shall not apply and the increase determined under 
the first sentence of subsection (d)(1) shall be the 
amount determined under subsection (d)(1)(A) (de-
termined without regard to subsection (h)(4)). 
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208 
‘‘(2) 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’. 
‘‘(3) 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)(3)(A))’ for ‘described in sub-
section (c)’ in subsection (h)(4)(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.—As soon as practicable after the 
date of the enactment of this Act, the Secretary shall es-
tablish a program for making advance payments of the 
credit allowed under subsection (a) of section 24 on a 
monthly basis (determined without regard to subsection 
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209 
(i)(4)) of such section), or as frequently as the Secretary 
determines to be administratively feasible, to taxpayers de-
termined to be eligible for advance payment of such credit. 
‘‘(b) LIMITATION.— 
‘‘(1) IN GENERAL.—The Secretary may make 
payments under subsection (a) only to the extent 
that the total amount of such payments made to any 
taxpayer during the taxable year does not exceed an 
amount equal to the excess, if any, of— 
‘‘(A) subject to paragraph (2), the amount 
determined under subsection (a) of section 24 
with respect to such taxpayer (determined with-
out regard to subsection (i)(4)) of such section) 
for such taxable year, over 
‘‘(B) the estimated tax imposed by subtitle 
A, as reduced by the credits allowable under 
subparts A and C (other than section 24) of 
such part IV, with respect to such taxpayer for 
such taxable year, as determined in such man-
ner as the Secretary deems appropriate. 
‘‘(2) APPLICATION
OF
THRESHOLD
AMOUNT 
LIMITATION.—The program described in subsection 
(a) shall make reasonable efforts to apply the limita-
tion of section 24(b) with respect to payments made 
under such program. 
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211 
(3) CLERICAL AMEMDMENT.—The table of sec-
tions for chapter 77 of such Code is amended by in-
serting after the item relating to section 7527 the 
following new item: 
‘‘Sec. 7527A. Advance payment of child tax credit.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2019. 
SEC. 20132. APPLICATION OF CHILD TAX CREDIT IN POS-
SESSIONS. 
(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) APPLICATION OF CREDIT IN POSSESSIONS.— 
‘‘(1) MIRROR CODE POSSESSIONS.— 
‘‘(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 to that possession by reason of the ap-
plication of this section (determined without re-
gard to this subsection) with respect to taxable 
years beginning after 2019. Such amounts shall 
be determined by the Secretary based on infor-
mation provided by the government of the re-
spective possession. 
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212 
‘‘(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 with a mirror code tax 
system by reason of the application of this sec-
tion 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 
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.—In the case of any bona 
fide resident of Puerto Rico (within the meaning of 
section 937(a))— 
‘‘(A) the credit determined under this sec-
tion shall be allowable to such resident, 
‘‘(B) in the case of any taxable year begin-
ning during 2020, the increase determined 
under the first sentence of subsection (d)(1) 
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213 
shall be the amount determined under sub-
section (d)(1)(A) (determined without regard to 
subsection (h)(4)), 
‘‘(C) in the case of any taxable year begin-
ning after December 31, 2020, and before Jan-
uary 1, 2026, the increase determined under 
the first sentence of subsection (d)(1) shall be 
the lesser of— 
‘‘(i) the amount determined under 
subsection (d)(1)(A) (determined without 
regard to subsection (h)(4)), or 
‘‘(ii) the dollar amount in effect under 
subsection (h)(5), and 
‘‘(D) in the case of any taxable year after 
December 31, 2025, the increase determined 
under the first sentence of subsection (d)(1) 
shall be the amount determined under sub-
section (d)(1)(A). 
‘‘(3) AMERICAN SAMOA.— 
‘‘(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-
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ning after 2019 if the provisions of this section 
had been in effect in American Samoa. 
‘‘(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 the 
residents of American Samoa in a manner 
which replicates to the greatest degree prac-
ticable the benefits that would have been so 
provided to each such resident. 
‘‘(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 
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), rules similar to 
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the rules of paragraph (2) shall apply with 
respect to bona fide residents of American 
Samoa (within the meaning of section 
937(a)). 
‘‘(4) TREATMENT
OF
PAYMENTS.—The pay-
ments made under this subsection shall be treated in 
the same manner for purposes of section 1324(b)(2) 
of title 31, United States Code, as refunds due from 
the credit allowed under this section.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2019. 
Subtitle E—Dependent Care Assistance 
SEC. 20141. 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 2020.—In the case of any 
taxable year beginning after December 31, 2019, and be-
fore January 1, 2021— 
‘‘(1) CREDIT MADE REFUNDABLE.—In the case 
of an individual other than a nonresident alien, the 
credit allowed under subsection (a) shall be treated 
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as a credit allowed under subpart C (and not allowed 
under this subpart). 
‘‘(2) INCREASE IN APPLICABLE PERCENTAGE.— 
Subsection (a)(2) shall be applied— 
‘‘(A) by substituting ‘50 percent’ for ‘35 
percent ’, and 
‘‘(B) 
by 
substituting 
‘$120,000’ 
for 
‘$15,000’. 
‘‘(3) INCREASE IN DOLLAR LIMIT ON AMOUNT 
CREDITABLE.—Subsection (c) shall be applied— 
‘‘(A) by substituting ‘$6,000’ for ‘$3,000’ 
in paragraph (1) thereof, and 
‘‘(B) by substituting ‘twice the amount in 
effect under paragraph (1)’ for ‘$6,000’ in 
paragraph (2) thereof.’’. 
(b) CONFORMING AMENDMENT.—Section 1324(b)(2) 
of title 31, United States Code, is amended by inserting 
‘‘21 (by reason of subsection (g) thereof),’’ before ‘‘25A’’. 
(c) COORDINATION WITH POSSESSION TAX SYS-
TEMS.—Section 21(g)(1) of the Internal Revenue Code of 
1986 (as added by this section) shall not apply to any per-
son— 
(1) to whom a credit is allowed against taxes 
imposed by a possession with a mirror code tax sys-
tem by reason of the application of section 21 of 
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217 
such Code in such possession for such taxable year, 
or 
(2) to whom a credit would be allowed against 
taxes imposed by a possession which does not have 
a mirror code tax system if the provisions of section 
21 of such Code had been in effect in such posses-
sion for such taxable year. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2019. 
SEC. 20142. 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
2020.—In the 
case of any taxable year beginning during 2020, 
subparagraph (A) shall be applied be sub-
stituting ‘$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, 2019. 
(c) RETROACTIVE PLAN AMENDMENTS.—A plan or 
other arrangement that otherwise satisfies all applicable 
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requirements of sections 106, 125, and 129 of the Internal 
Revenue Code of 1986 (including any rules or regulations 
thereunder) shall not fail to be treated as a cafeteria plan 
or dependent care flexible spending arrangement merely 
because such plan or arrangement is amended pursuant 
to a provision under this section and such amendment is 
retroactive, if— 
(1) such amendment is adopted no later than 
the last day of the plan year in which the amend-
ment is effective, and 
(2) the plan or arrangement is operated con-
sistent 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. 
Subtitle F—Flexibility for Certain Employee Benefits 
SEC. 20151. INCREASE IN CARRYOVER FOR HEALTH FLEXI-
BLE SPENDING ARRANGEMENTS. 
(a) IN GENERAL.—A plan or other arrangement that 
otherwise satisfies all of the applicable requirements of 
sections 106 and 125 of the Internal Revenue Code of 
1986 (including any rules or regulations thereunder) shall 
not fail to be treated as a cafeteria plan or health flexible 
spending arrangement merely because such plan or ar-
rangement permits participants to carry over an amount 
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219 
not in excess of $2,750 of unused benefits or contributions 
remaining in a health flexible spending arrangement from 
the plan year ending in 2020 to the plan year ending in 
2021. 
(b) DEFINITIONS.—Any term used in this section 
which is also used in section 106 or 125 of the Internal 
Revenue Code of 1986 or the rules or regulations there-
under shall have the same meaning as when used in such 
section or rules or regulations. 
SEC. 20152. CARRYOVER FOR DEPENDENT CARE FLEXIBLE 
SPENDING ARRANGEMENTS. 
(a) IN GENERAL.—A plan or other arrangement that 
otherwise satisfies all applicable requirements of sections 
106, 125, and 129 of the Internal Revenue Code of 1986 
(including any rules or regulations thereunder) shall not 
fail to be treated as a cafeteria plan or dependent care 
flexible spending arrangement merely because such plan 
or arrangement permits participants to carry over (under 
rules similar to the rules applicable to health flexible 
spending arrangements) an amount, not in excess of the 
amount in effect under section 129(a)(2)(A) of such Code, 
of unused benefits or contributions remaining in a depend-
ent care flexible spending arrangement from the plan year 
ending in 2020 to the plan year ending in 2021. 
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(b) DEFINITIONS.—Any term used in this section 
which is also used in section 106, 125, or 129 of the Inter-
nal Revenue Code of 1986 or the rules or regulations 
thereunder shall have the same meaning as when used in 
such section or rules or regulations. 
SEC. 20153. CARRYOVER OF PAID TIME OFF. 
(a) IN GENERAL.—A plan that otherwise satisfies all 
applicable requirements of section 125 of the Internal Rev-
enue Code of 1986 (including any rules or regulations 
thereunder) shall not fail to be treated as a cafeteria plan 
merely because such plan permits participants to carry 
over (under rules similar to the rules applicable to health 
flexible spending arrangements) any amount of paid time 
off (without limitation) from the plan year ending in 2020 
to the plan year ending in 2021. 
(b) DEFINITIONS.—Any term used in this section 
which is also used in section 125 of the Internal Revenue 
Code of 1986 or the rules or regulations thereunder shall 
have the same meaning as when used in such section or 
rules or regulations. 
SEC. 20154. CHANGE IN ELECTION AMOUNT. 
(a) IN GENERAL.—A plan or other arrangement that 
otherwise satisfies all applicable requirements of sections 
106 and 125 of the Internal Revenue Code of 1986 (in-
cluding any rules or regulations thereunder) shall not fail 
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221 
to be treated as a cafeteria plan or health flexible spending 
arrangement merely because such plan or arrangement al-
lows an employee to make, with respect to the remaining 
portion of a period of coverage within the applicable pe-
riod— 
(1) an election modifying the amount of such 
employee’s contributions to such a health flexible 
spending arrangement (without regard to any 
change in status), or 
(2) an election modifying the amount of such 
employee’s elective paid time off. 
Any election as modified under paragraph (1) shall not 
exceed the limitation applicable under section 125(i) for 
the taxable year. 
(b) ONE-TIME APPLICATION.—Paragraphs (1) and 
(2) of subsection (a) shall each apply to only 1 election 
change described in such paragraph with respect to an em-
ployee (in addition to any other election changes during 
a period of coverage permitted under the plan or arrange-
ment without regard to this section). 
(c) APPLICABLE PERIOD.—For purposes of this sec-
tion, the term ‘‘applicable period’’ means the period begin-
ning on the date of the enactment of this Act and ending 
on December 31, 2020. 
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(d) DEFINITIONS.—Any term used in this section 
which is also used in section 106 or 125 of the Internal 
Revenue Code of 1986 or the rules or regulations there-
under shall have the same meaning as when used in such 
section or rules or regulations. 
SEC. 20155. EXTENSION OF GRACE PERIODS, ETC. 
(a) IN GENERAL.—A plan or other arrangement that 
otherwise satisfies all applicable requirements of sections 
106, 125, or 129 of the Internal Revenue Code (including 
any rules or regulations thereunder) shall not fail to be 
treated as a cafeteria plan, health flexible spending ar-
rangement, or dependent care flexible spending arrange-
ment (whichever is applicable) merely because such plan 
or arrangement extends the grace period for the plan year 
ending in 2020 to 12 months after the end of such plan 
year, with respect to unused benefits or contributions re-
maining in a health flexible spending arrangement or a 
dependent care flexible spending arrangement. 
(b) POST-TERMINATION REIMBURSEMENTS FROM 
HEALTH FSAS.—A plan or other arrangement that other-
wise satisfies all applicable requirements of sections 106 
and 125 of the Internal Revenue Code of 1986 (including 
any rules or regulations thereunder) shall not fail to be 
treated as a cafeteria plan or health flexible spending ar-
rangement merely because such plan or arrangement al-
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223 
lows (under rules similar to the rules applicable to depend-
ent care flexible spending arrangements) an employee who 
ceases participation in the plan during calendar year 2020 
to continue to receive reimbursements from unused bene-
fits or contributions through the end of the plan year (in-
cluding any grace period, taking into account any modi-
fication of a grace period permitted under subsection (a)). 
(c) DEFINITIONS.—Any term used in this section 
which is also used in section 106, 125, or 129 of the Inter-
nal Revenue Code of 1986 or the rules or regulations 
thereunder shall have the same meaning as when used in 
such section or rules or regulations. 
SEC. 20156. PLAN AMENDMENTS. 
A plan or other arrangement that otherwise satisfies 
all applicable requirements of sections 106, 125, and 129 
of the Internal Revenue Code of 1986 (including any rules 
or regulations thereunder) shall not fail to be treated as 
a cafeteria plan, health flexible spending arrangement, or 
dependent care flexible spending arrangement merely be-
cause such plan or arrangement is amended pursuant to 
a provision under this subtitle 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 amend-
ment is effective, and 
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224 
(2) the plan or arrangement is operated con-
sistent 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. 
Subtitle G—Deduction of State and Local Taxes 
SEC. 20161. ELIMINATION FOR 2020 AND 2021 OF LIMITA-
TION ON DEDUCTION OF STATE AND LOCAL 
TAXES. 
(a) IN GENERAL.—Section 164(b)(6)(B) of the Inter-
nal Revenue Code of 1986 is amended by inserting ‘‘in 
the case of a taxable year beginning before January 1, 
2020, or after December 31, 2021,’’ before ‘‘the aggregate 
amount of taxes’’. 
(b) CONFORMING AMENDMENTS.—Section 164(b)(6) 
of the Internal Revenue Code of 1986 is amended— 
(1) by striking ‘‘For purposes of subparagraph 
(B)’’ and inserting ‘‘For purposes of this section’’, 
(2) by striking ‘‘January 1, 2018’’ and insert-
ing ‘‘January 1, 2022’’, 
(3) by striking ‘‘December 31, 2017, shall’’ and 
inserting ‘‘December 31, 2021, shall’’, and 
(4) by adding at the end the following: ‘‘For 
purposes of this section, in the case of State or local 
taxes with respect to any real or personal property 
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paid during a taxable year beginning in 2020 or 
2021, the Secretary shall prescribe rules which treat 
all or a portion of such taxes as paid in a taxable 
year or years other than the taxable year in which 
actually paid as necessary or appropriate to prevent 
the avoidance of the limitations of this subsection.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxes paid or accrued in taxable 
years beginning after December 31, 2019. 
TITLE II—ADDITIONAL RELIEF FOR WORKERS 
Subtitle A—Additional Relief 
SEC. 20201. INCREASE IN ABOVE-THE-LINE DEDUCTION FOR 
CERTAIN EXPENSES OF ELEMENTARY AND 
SECONDARY SCHOOL TEACHERS. 
(a) INCREASE.—Section 62(a)(2)(D) of the Internal 
Revenue Code of 1986 is amended by striking ‘‘$250’’ and 
inserting ‘‘$500’’. 
(b) CONFORMING AMENDMENTS.—Section 62(d)(3) 
of the Internal Revenue Code of 1986 is amended— 
(1) by striking ‘‘2015’’ and inserting ‘‘2020’’, 
(2) by striking ‘‘$250’’ and inserting ‘‘$500’’, 
and 
(3) in subparagraph (B), by striking ‘‘2014’’ 
and inserting ‘‘2019’’. 
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226 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2019. 
SEC. 20202. ABOVE-THE-LINE DEDUCTION ALLOWED FOR 
CERTAIN EXPENSES OF FIRST RESPONDERS. 
(a) IN GENERAL.—Section 62(a)(2) of the Internal 
Revenue Code of 1986 is amended by adding at the end 
the following new subparagraph: 
‘‘(F) CERTAIN
EXPENSES
OF
FIRST
RE-
SPONDERS.—The deductions allowed by section 
162 which consist of expenses, not in excess of 
$500, paid or incurred by a first responder— 
‘‘(i) as tuition or fees for the partici-
pation of the first responder in profes-
sional development courses related to serv-
ice as a first responder, or 
‘‘(ii) for uniforms used by the first re-
sponder in service as a first responder.’’. 
(b) FIRST RESPONDER DEFINED.—Section 62(d) of 
the Internal Revenue Code of 1986 is amended by adding 
at the end the following new paragraph: 
‘‘(4) FIRST RESPONDER.—For purposes of sub-
section (a)(2)(F), the term ‘first responder’ means, 
with respect to any taxable year, any employee who 
provides at least 1000 hours of service during such 
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227 
taxable year as a law enforcement officer, firefighter, 
paramedic, or emergency medical technician.’’. 
(c) INFLATION ADJUSTMENT.—Section 62(d)(3) of 
the Internal Revenue Code of 1986, as amended by the 
preceding provisions of this Act, is further amended by 
striking ‘‘the $500 amount in subsection (a)(2)(D)’’ and 
inserting ‘‘the $500 amount in each of subparagraphs (D) 
and (F) of subsection (a)(2)’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2019. 
SEC. 20203. TEMPORARY ABOVE-THE-LINE DEDUCTION FOR 
SUPPLIES AND EQUIPMENT OF FIRST RE-
SPONDERS AND COVID–19 FRONT LINE EM-
PLOYEES. 
(a) IN GENERAL.—Section 62(d) 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 of the 
following new paragraph: 
‘‘(5) TEMPORARY RULE FOR FIRST RESPOND-
ERS AND COVID–19 FRONT LINE EMPLOYEES.— 
‘‘(A) IN
GENERAL.—In the case of any 
taxable year beginning in 2020— 
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228 
‘‘(i) subsection (a)(2)(F)(ii) shall be 
applied by substituting ‘uniforms, supplies, 
or equipment’ for ‘uniforms’, and 
‘‘(ii) 
for 
purposes 
of 
subsection 
(a)(2)(F), the term ‘first responder’ shall 
include any COVID–19 front line em-
ployee. 
‘‘(B) 
COVID–19 
FRONT
LINE
EM-
PLOYEE.—For purposes of this paragraph, the 
term ‘COVID–19 front line employee’ means, 
with respect to any taxable year, any individual 
who performs at least 1000 hours of essential 
work (as defined in the COVID–19 Heroes 
Fund Act except without regard to the time pe-
riod during which such work is performed) dur-
ing such taxable year as an employee in a trade 
or business of an employer.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2019. 
SEC. 20204. PAYROLL CREDIT FOR CERTAIN PANDEMIC-RE-
LATED EMPLOYEE BENEFIT EXPENSES PAID 
BY EMPLOYERS. 
(a) IN GENERAL.—In the case of an employer, there 
shall be allowed as a credit against applicable employment 
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229 
taxes for each calendar quarter an amount equal to the 
applicable percentage of the qualified pandemic-related 
employee benefit expenses paid by such employer with re-
spect to such calendar quarter. 
(b) LIMITATIONS AND REFUNDABILITY.— 
(1) DOLLAR LIMITATION PER EMPLOYEE.—The 
qualified pandemic-related employee benefit expenses 
which may be taken into account under subsection 
(a) with respect to any employee for any calendar 
quarter shall not exceed $5,000. 
(2) CREDIT LIMITED TO CERTAIN EMPLOYMENT 
TAXES.—The credit allowed by subsection (a) with 
respect to any calendar quarter shall not exceed the 
applicable employment taxes for such calendar quar-
ter (reduced by any credits allowed under sub-
sections (e) and (f) of section 3111 of such Code, 
sections 7001 and 7003 of the Families First 
Coronavirus Response Act, and section 2301 of the 
CARES Act, for such quarter) on the wages paid 
with respect to the employment of all the employees 
of the employer for such calendar quarter. 
(3) REFUNDABILITY OF EXCESS CREDIT.— 
(A) IN GENERAL.—If the amount of the 
credit under subsection (a) exceeds the limita-
tion of paragraph (2) for any calendar quarter, 
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230 
such excess shall be treated as an overpayment 
that shall be refunded under sections 6402(a) 
and 6413(b) of the Internal Revenue Code of 
1986. 
(B) TREATMENT OF PAYMENTS.—For pur-
poses of section 1324 of title 31, United States 
Code, any amounts due to an employer under 
this paragraph shall be treated in the same 
manner as a refund due from a credit provision 
referred to in subsection (b)(2) of such section. 
(4) 
COORDINATION
WITH
GOVERNMENT 
GRANTS.—The qualified pandemic-related employee 
benefit expenses taken into account under this sec-
tion by any employer shall be reduced by any 
amounts provided by and Federal, State, or local 
government for purposes of making or reimbursing 
such expenses. 
(c) QUALIFIED
PANDEMIC-RELATED
EMPLOYEE 
BENEFIT EXPENSES.—For purposes of this section, the 
term ‘‘qualified pandemic-related employee benefit ex-
penses’’ means any amount paid to or for the benefit of 
an employee in the employment of the employer if— 
(1) such amount is excludible from the gross in-
come of the employee under section 139 of the Inter-
nal Revenue Code of 1986 by reason of being a 
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qualified disaster relief payment described in sub-
section (b)(1) of such section with respect to a quali-
fied disaster described in subsection (c)(2) of such 
section which was declared by reason of COVID–19, 
and 
(2) the employer elects (at such time and in 
such manner as the Secretary may provide) to treat 
such amount as a qualified pandemic-related em-
ployee benefit expense. 
(d) APPLICABLE PERCENTAGE.—For purposes of 
this section— 
(1) IN GENERAL.—The term ‘‘applicable per-
centage’’ means— 
(A) 50 percent, in the case of qualified 
pandemic-related employee benefit expenses 
paid with respect to an essential employee, and 
(B) 30 percent, in any other case. 
(2) ESSENTIAL EMPLOYEE.—The term ‘‘essen-
tial employee’’ means, with respect to any employer 
for any calendar quarter, any employee of such em-
ployer if a substantial portion of the services per-
formed by such employee for such employer during 
such calendar quarter are essential work (as defined 
in the COVID–19 Heroes Fund Act except without 
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232 
regard to the time period during which such work is 
performed). 
(e) SPECIAL RULES; OTHER DEFINITIONS.— 
(1) APPLICATION OF CERTAIN NON-DISCRIMINA-
TION RULES.—No credit shall be allowed under this 
section to any employer for any calendar quarter if 
qualified pandemic-related employee benefit expenses 
are provided by such employer to employees for such 
calendar quarter in a manner which discriminates in 
favor of highly compensated individuals (within the 
meaning of section 125) as to eligibility for, or the 
amount of, such benefit expenses. An employer may 
elect with respect to any calendar quarter to apply 
this paragraph separately with respect to essential 
employees and with respect to all other employees. 
(2) DENIAL OF DOUBLE BENEFIT.—For pur-
poses of chapter 1 of such Code, no deduction or 
credit (other than the credit allowed under this sec-
tion) shall be allowed for so much of qualified pan-
demic-related employee benefit expenses as is equal 
to the credit allowed under this section. 
(3) THIRD PARTY PAYORS.—Any credit allowed 
under this section shall be treated as a credit de-
scribed in section 3511(d)(2) of such Code. 
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(4) APPLICABLE
EMPLOYMENT
TAXES.—For 
purposes of this section, the term ‘‘applicable em-
ployment taxes’’ means the following: 
(A) The taxes imposed under section 
3111(a) of the Internal Revenue Code of 1986. 
(B) So much of the taxes imposed under 
section 3221(a) of such Code as are attrib-
utable to the rate in effect under section 
3111(a) of such Code. 
(5) SECRETARY.—For purposes of this section, 
the term ‘‘Secretary’’ means the Secretary of the 
Treasury or the Secretary’s delegate. 
(6) CERTAIN TERMS.— 
(A) IN GENERAL.—Any term used in this 
section which is also used in chapter 21 or 22 
of such Code shall have the same meaning as 
when used in such chapter (as the case may 
be). 
(B) CERTAIN
PROVISIONS
NOT
TAKEN 
INTO ACCOUNT EXCEPT FOR PURPOSES OF LIM-
ITING CREDIT TO EMPLOYMENT TAXES.—For 
purposes of subparagraph (A) (other than with 
respect to subsection (b)(2)), section 3121(b) of 
such Code shall be applied without regard to 
paragraphs (1), (5), (6), (7), (8), (10), (13), 
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234 
(18), (19), and (22) thereof (except with re-
spect to services performed in a penal institu-
tion by an inmate thereof) and section 
3231(e)(1) shall be applied without regard to 
the sentence that begins ‘‘Such term does not 
include remuneration’’. 
(f) CERTAIN GOVERNMENTAL EMPLOYERS.— 
(1) IN GENERAL.—The credit under this section 
shall not be allowed to the Federal Government or 
any agency or instrumentality thereof. 
(2) EXCEPTION.—Paragraph (1) shall not 
apply to any organization described in section 
501(c)(1) of the Internal Revenue Code of 1986 and 
exempt from tax under section 501(a) of such Code. 
(g) TREATMENT OF DEPOSITS.—The Secretary shall 
waive any penalty under section 6656 of such Code for 
any failure to make a deposit of applicable employment 
taxes if the Secretary determines that such failure was due 
to the anticipation of the credit allowed under this section. 
(h) REGULATIONS.—The Secretary shall prescribe 
such regulations or other guidance as may be necessary 
to carry out the purposes of this section, including regula-
tions or other guidance— 
(1) to allow the advance payment of the credit 
determined under subsection (a), subject to the limi-
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235 
tations provided in this section, based on such infor-
mation as the Secretary shall require, 
(2) to provide for the reconciliation of such ad-
vance payment with the amount of the credit at the 
time of filing the return of tax for the applicable 
quarter or taxable year, 
(3) for recapturing the benefit of credits deter-
mined under this section in cases where there is a 
subsequent adjustment to the credit determined 
under subsection (a), and 
(4) with respect to the application of the credit 
to third party payors (including professional em-
ployer organizations, certified professional employer 
organizations, or agents under section 3504 of such 
Code), including to allow such payors to submit doc-
umentation necessary to substantiate eligibility for, 
and the amount of, the credit allowed under this sec-
tion. 
(i) APPLICATION OF SECTION.—This section shall 
apply only to qualified pandemic-related employee benefit 
expenses paid after March 12, 2020, and before January 
1, 2021. 
(j) TRANSFERS TO CERTAIN TRUST FUNDS.—There 
are hereby appropriated to the Federal Old-Age and Sur-
vivors Insurance Trust Fund and the Federal Disability 
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236 
Insurance Trust Fund established under section 201 of 
the Social Security Act (42 U.S.C. 401) and the Social 
Security Equivalent Benefit Account established under 
section 15A(a) of the Railroad Retirement Act of 1974 
(45 U.S.C. 231n–1(a)) amounts equal to the reduction in 
revenues to the Treasury by reason of this section (without 
regard to this subsection). Amounts appropriated by the 
preceding sentence shall be transferred from the general 
fund at such times and in such manner as to replicate 
to the extent possible the transfers which would have oc-
curred to such Trust Fund or Account had this section 
not been enacted. 
Subtitle B—Tax Credits to Prevent Business 
Interruption 
SEC. 20211. IMPROVEMENTS TO EMPLOYEE RETENTION 
CREDIT. 
(a) INCREASE
IN CREDIT PERCENTAGE.—Section 
2301(a) of the CARES Act is amended by striking ‘‘50 
percent’’ and inserting ‘‘80 percent’’. 
(b) INCREASE IN PER EMPLOYEE LIMITATION.—Sec-
tion 2301(b)(1) of the CARES Act is amended by striking 
‘‘for all calendar quarters shall not exceed $10,000.’’ and 
inserting ‘‘shall not exceed— 
‘‘(A) $15,000 in any calendar quarter, and 
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‘‘(B) $45,000 in the aggregate for all cal-
endar quarters.’’. 
(c) MODIFICATION OF THRESHOLD FOR TREATMENT 
AS A LARGE EMPLOYER.— 
(1) IN GENERAL.—Section 2301(c)(3)(A) of the 
CARES Act is amended— 
(A) by striking ‘‘for which the average 
number of full-time employees (within the 
meaning of section 4980H of the Internal Rev-
enue Code of 1986) employed by such eligible 
employer during 2019 was greater than 100’’ in 
clause (i) and inserting ‘‘which is a large em-
ployer’’, and 
(B) by striking ‘‘for which the average 
number of full-time employees (within the 
meaning of section 4980H of the Internal Rev-
enue Code of 1986) employed by such eligible 
employer during 2019 was not greater than 
100’’ in clause (ii) and inserting ‘‘which is not 
a large employer’’. 
(2) 
LARGE
EMPLOYER
DEFINED.—Section 
2301(c) of the CARES Act is amended by redesig-
nating paragraph (6) as paragraph (7) and by in-
serting after paragraph (5) the following new para-
graph: 
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‘‘(6) LARGE EMPLOYER.—The term ‘large em-
ployer’ means any eligible employer if— 
‘‘(A) the average number of full-time em-
ployees (as determined for purposes of deter-
mining whether an employer is an applicable 
large 
employer 
for 
purposes 
of 
section 
4980H(c)(2) of the Internal Revenue Code of 
1986) employed by such eligible employer dur-
ing calendar year 2019 was greater than 1,500, 
and 
‘‘(B) the gross receipts (within the mean-
ing of section 448(c) of the Internal Revenue 
Code of 1986) of such eligible employer during 
calendar 
year 
2019 
was 
greater 
than 
$41,500,000.’’. 
(d) PHASE-IN OF ELIGIBILITY BASED ON REDUC-
TION IN GROSS RECEIPTS.— 
(1) DECREASE OF REDUCTION IN GROSS RE-
CEIPTS NECESSARY TO QUALIFY FOR CREDIT.—Sec-
tion 2301(c)(2)(B) of the CARES Act is amended— 
(A) by striking ‘‘50 percent’’ in clause (i) 
and inserting ‘‘90 percent’’, and 
(B) by striking ‘‘80 percent’’ in clause (ii) 
and inserting ‘‘90 percent’’. 
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(2) PHASE-IN
OF
CREDIT
IF
REDUCTION
IN 
GROSS RECEIPTS IS LESS THAN 50 PERCENT.—Sec-
tion 2301(c)(2) of the CARES Act is amended by 
adding at the end the following new subparagraph: 
‘‘(D) PHASE-IN OF CREDIT WHERE BUSI-
NESS
NOT
SUSPENDED
AND
REDUCTION
IN 
GROSS RECEIPTS LESS THAN 50 PERCENT.— 
‘‘(i) IN GENERAL.—In the case of any 
calendar quarter with respect to which an 
eligible employer would not be an eligible 
employer if subparagraph (B)(i) were ap-
plied by substituting ‘50 percent’ for ‘90 
percent’, the amount of the credit allowed 
under subsection (a) shall be reduced by 
the amount which bears the same ratio to 
the amount of such credit (determined 
without regard to this subparagraph) as— 
‘‘(I) the excess gross receipts per-
centage point amount, bears to 
‘‘(II) 40 percentage points. 
‘‘(ii) EXCESS GROSS RECEIPTS PER-
CENTAGE POINT AMOUNT.—For purposes 
of this subparagraph, the term ‘excess 
gross receipts percentage point amount’ 
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240 
means, with respect to any calendar quar-
ter, the excess of— 
‘‘(I) the lowest of the gross re-
ceipts percentage point amounts de-
termined with respect to any calendar 
quarter during the period ending with 
such calendar quarter and beginning 
with the first calendar quarter during 
the period described in subparagraph 
(B), over 
‘‘(II) 50 percentage points. 
‘‘(iii) GROSS RECEIPTS PERCENTAGE 
POINT
AMOUNTS.—For purposes of this 
subparagraph, the term ‘gross receipts per-
centage point amount’ means, with respect 
to any calendar quarter, the percentage 
(expressed as a number of percentage 
points) obtained by dividing— 
‘‘(I) the gross receipts (within 
the meaning of subparagraph (B)) for 
such calendar quarter, by 
‘‘(II) the gross receipts for the 
same calendar quarter in calendar 
year 2019.’’. 
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241 
(3) GROSS RECEIPTS OF TAX-EXEMPT ORGANI-
ZATIONS.—Section 2301(c)(2)(C) of the CARES Act 
is amended— 
(A) by striking ‘‘of such Code, clauses (i) 
and (ii)(I)’’ and inserting ‘‘of such Code— 
‘‘(i) clauses (i) and (ii)(I)’’, 
(B) by striking the period at the end and 
inserting ‘‘, and’’, and 
(C) by adding at the end the following new 
clause: 
‘‘(ii) any reference in this section to 
gross receipts shall be treated as a ref-
erence to gross receipts within the meaning 
of section 6033 of such Code.’’. 
(e) MODIFICATION
OF TREATMENT
OF HEALTH 
PLAN EXPENSES.— 
(1) IN
GENERAL.—Section 2301(c)(5) of the 
CARES Act is amended to read as follows: 
‘‘(5) WAGES.— 
‘‘(A) IN
GENERAL.—The term ‘wages’ 
means wages (as defined in section 3121(a) of 
the Internal Revenue Code of 1986) and com-
pensation (as defined in section 3231(e) of such 
Code). 
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242 
‘‘(B) ALLOWANCE FOR CERTAIN HEALTH 
PLAN EXPENSES.— 
‘‘(i) IN
GENERAL.—Such term shall 
include amounts paid or incurred by the el-
igible employer to provide and maintain a 
group health plan (as defined in section 
5000(b)(1) of the Internal Revenue Code 
of 1986), but only to the extent that such 
amounts are excluded from the gross in-
come of employees by reason of section 
106(a) of such Code. 
‘‘(ii) ALLOCATION RULES.—For pur-
poses of this section, amounts treated as 
wages under clause (i) shall be treated as 
paid with respect to any employee (and 
with respect to any period) to the extent 
that such amounts are properly allocable to 
such employee (and to such period) in such 
manner as the Secretary may prescribe. 
Except as otherwise provided by the Sec-
retary, such allocation shall be treated as 
properly made if made on the basis of 
being pro rata among periods of cov-
erage.’’. 
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243 
(2) 
CONFORMING
AMENDMENT.—Section 
2301(c)(3) of the CARES Act is amended by strik-
ing subparagraph (C). 
(f) QUALIFIED WAGES PERMITTED
TO INCLUDE 
AMOUNTS FOR TIP REPLACEMENT.— 
(1) IN GENERAL.—Section 2301(c)(3)(B) of the 
CARES Act is amended by inserting ‘‘(including tips 
which would have been deemed to be paid by the em-
ployer under section 3121(q))’’ after ‘‘would have 
been paid’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
2301(h)(2) of the CARES Act is amended by insert-
ing ‘‘45B or’’ before ‘‘45S’’. 
(g) CERTAIN GOVERNMENTAL EMPLOYERS ELIGIBLE 
FOR CREDIT.— 
(1) IN
GENERAL.—Section 2301(f) of the 
CARES Act is amended to read as follows: 
‘‘(f) CERTAIN GOVERNMENTAL EMPLOYERS.— 
‘‘(1) IN GENERAL.—The credit under this sec-
tion shall not be allowed to the Federal Government 
or any agency or instrumentality thereof. 
‘‘(2) EXCEPTION.—Paragraph (1) shall not 
apply to any organization described in section 
501(c)(1) of the Internal Revenue Code of 1986 and 
exempt from tax under section 501(a) of such Code. 
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244 
‘‘(3) SPECIAL RULES.—In the case of any State 
government, Indian tribal government, or any agen-
cy, instrumentality, or political subdivision of the 
foregoing— 
‘‘(A) clauses (i) and (ii)(I) of subsection 
(c)(2)(A) shall apply to all operations of such 
entity, and 
‘‘(B) 
subclause 
(II) 
of 
subsection 
(c)(2)(A)(ii) shall not apply.’’. 
(2) COORDINATION WITH APPLICATION OF CER-
TAIN DEFINITIONS.— 
(A) IN GENERAL.—Section 2301(c)(5)(A) 
of the CARES Act, as amended by the pre-
ceding provisions of this Act, is amended by 
adding at the end the following: ‘‘For purposes 
of the preceding sentence (other than for pur-
poses of subsection (b)(2)), wages as defined in 
section 3121(a) of the Internal Revenue Code 
of 1986 shall be determined without regard to 
paragraphs (1), (5), (6), (7), (8), (10), (13), 
(18), (19), and (22) of section 3212(b) of such 
Code (except with respect to services performed 
in a penal institution by an inmate thereof).’’. 
(B) 
CONFORMING
AMENDMENTS.—Sec-
tions 2301(c)(6) of the CARES Act is amended 
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245 
by striking ‘‘Any term’’ and inserting ‘‘Except 
as otherwise provided in this section, any 
term’’. 
(h) EFFECTIVE DATE.—The amendments made by 
this section shall take effect as if included in section 2301 
of the CARES Act. 
SEC. 20212. PAYROLL CREDIT FOR CERTAIN FIXED EX-
PENSES OF EMPLOYERS SUBJECT TO CLO-
SURE BY REASON OF COVID–19. 
(a) IN GENERAL.—In the case of an eligible em-
ployer, there shall be allowed as a credit against applicable 
employment taxes for each calendar quarter an amount 
equal to 50 percent of the qualified fixed expenses paid 
or incurred by such employer during such calendar quar-
ter. 
(b) LIMITATIONS AND REFUNDABILITY.— 
(1) LIMITATION.—The qualified fixed expenses 
which may be taken into account under subsection 
(a) by any eligible employer for any calendar quarter 
shall not exceed the least of— 
(A) the qualified fixed expenses paid by the 
eligible employer in the same calendar quarter 
of calendar year 2019, 
(B) $50,000, or 
(C) the greater of— 
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246 
(i) 25 percent of the wages paid with 
respect to the employment of all the em-
ployees of the eligible employer for such 
calendar quarter, or 
(ii) 6.25 percent of the gross receipts 
of the eligible employer for calendar year 
2019. 
(2) CREDIT LIMITED TO CERTAIN EMPLOYMENT 
TAXES.—The credit allowed by subsection (a) with 
respect to any calendar quarter shall not exceed the 
applicable employment taxes for such calendar quar-
ter (reduced by any credits allowed under sub-
sections (e) and (f) of section 3111 of such Code, 
sections 7001 and 7003 of the Families First 
Coronavirus Response Act, section 2301 of the 
CARES Act, and section 20204 of this division, for 
such quarter) on the wages paid with respect to the 
employment of all the employees of the eligible em-
ployer for such calendar quarter. 
(3) REFUNDABILITY OF EXCESS CREDIT.— 
(A) IN GENERAL.—If the amount of the 
credit under subsection (a) exceeds the limita-
tion of paragraph (2) for any calendar quarter, 
such excess shall be treated as an overpayment 
that shall be refunded under sections 6402(a) 
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247 
and 6413(b) of the Internal Revenue Code of 
1986. 
(B) TREATMENT OF PAYMENTS.—For pur-
poses of section 1324 of title 31, United States 
Code, any amounts due to an employer under 
this paragraph shall be treated in the same 
manner as a refund due from a credit provision 
referred to in subsection (b)(2) of such section. 
(c) DEFINITIONS.—For purposes of this section— 
(1) APPLICABLE
EMPLOYMENT
TAXES.—The 
term ‘‘applicable employment taxes’’ means the fol-
lowing: 
(A) The taxes imposed under section 
3111(a) of the Internal Revenue Code of 1986. 
(B) So much of the taxes imposed under 
section 3221(a) of such Code as are attrib-
utable to the rate in effect under section 
3111(a) of such Code. 
(2) ELIGIBLE EMPLOYER.— 
(A) IN GENERAL.—The term ‘‘eligible em-
ployer’’ means any employer— 
(i) which was carrying on a trade or 
business during calendar year 2020, 
(ii) which had either— 
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248 
(I) not more than 1,500 full-time 
equivalent employees (as determined 
for purposes of determining whether 
an employer is an applicable large em-
ployer 
for 
purposes 
of 
section 
4980H(c)(2) of the Internal Revenue 
Code of 1986) for calendar year 2019, 
or 
(II) not more than $41,500,000 
of gross receipts in the last taxable 
year ending in 2019, and 
(iii) with respect to any calendar 
quarter, for which— 
(I) the operation of the trade or 
business described in clause (i) is fully 
or partially suspended during the cal-
endar quarter due to orders from an 
appropriate governmental authority 
limiting commerce, travel, or group 
meetings (for commercial, social, reli-
gious, or other purposes) due to the 
coronavirus disease 2019 (COVID– 
19), or 
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249 
(II) such calendar quarter is 
within the period described in sub-
paragraph (B). 
(B) SIGNIFICANT DECLINE IN GROSS RE-
CEIPTS.—The period described in this subpara-
graph is the period— 
(i) beginning with the first calendar 
quarter beginning after December 31, 
2019, for which gross receipts (within the 
meaning of section 448(c) of the Internal 
Revenue Code of 1986) for the calendar 
quarter are less than 90 percent of gross 
receipts for the same calendar quarter in 
the prior year, and 
(ii) ending with the calendar quarter 
following the first calendar quarter begin-
ning after a calendar quarter described in 
clause (i) for which gross receipts of such 
employer are greater than 90 percent of 
gross receipts for the same calendar quar-
ter in the prior year. 
(C) TAX-EXEMPT ORGANIZATIONS.—In the 
case of an organization which is described in 
section 501(c) of the Internal Revenue Code of 
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1986 and exempt from tax under section 501(a) 
of such Code— 
(i) clauses (i) and (iii)(I) of subpara-
graph (A) shall apply to all operations of 
such organization, and 
(ii) any reference in this section to 
gross receipts shall be treated as a ref-
erence to gross receipts within the meaning 
of section 6033 of the Internal Revenue 
Code of 1986. 
(D) PHASE-IN OF CREDIT WHERE BUSI-
NESS
NOT
SUSPENDED
AND
REDUCTION
IN 
GROSS RECEIPTS LESS THAN 50 PERCENT.— 
(i) IN GENERAL.—In the case of any 
calendar quarter with respect to which an 
eligible employer would not be an eligible 
employer if subparagraph (B)(i) were ap-
plied by substituting ‘‘50 percent’’ for ‘‘90 
percent’’, the amount of the credit allowed 
under subsection (a) shall be reduced by 
the amount which bears the same ratio to 
the amount of such credit (determined 
without regard to this subparagraph) as— 
(I) the excess gross receipts per-
centage point amount, bears to 
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251 
(II) 40 percentage points. 
(ii) EXCESS
GROSS
RECEIPTS
PER-
CENTAGE POINT AMOUNT.—For purposes 
of this subparagraph, the term ‘‘excess 
gross receipts percentage point amount’’ 
means, with respect to any calendar quar-
ter, the excess of— 
(I) the lowest of the gross re-
ceipts percentage point amounts de-
termined with respect to any calendar 
quarter during the period ending with 
such calendar quarter and beginning 
with the first calendar quarter during 
the period described in subparagraph 
(B), over 
(II) 50 percentage points. 
(iii) GROSS
RECEIPTS
PERCENTAGE 
POINT
AMOUNTS.—For purposes of this 
subparagraph, the term ‘‘gross receipts 
percentage point amount’’ means, with re-
spect to any calendar quarter, the percent-
age (expressed as a number of percentage 
points) obtained by dividing— 
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252 
(I) the gross receipts (within the 
meaning of subparagraph (B)) for 
such calendar quarter, by 
(II) the gross receipts for the 
same calendar quarter in calendar 
year 2019. 
(3) QUALIFIED FIXED EXPENSES.— 
(A) IN
GENERAL.—The term ‘‘qualified 
fixed expenses’’ means the payment or accrual, 
in the ordinary course of the eligible employer’s 
trade or business, of any covered mortgage obli-
gation, covered rent obligation, or covered util-
ity payment. Such term shall not include the 
prepayment of any obligation for a period in ex-
cess of a month unless the payment for such 
period is customarily due in advance. 
(B) APPLICATION OF DEFINITIONS.—The 
terms ‘‘covered mortgage obligation’’, ‘‘covered 
rent obligation’’, and ‘‘covered utility payment’’ 
shall each have the same meaning as when used 
in section 1106 of the CARES Act. 
(4) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of the Treasury or the Secretary’s del-
egate. 
(5) WAGES.— 
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253 
(A) IN
GENERAL.—The term ‘‘wages’’ 
means wages (as defined in section 3121(a) of 
the Internal Revenue Code of 1986) and com-
pensation (as defined in section 3231(e) of such 
Code). For purposes of the preceding sentence 
(other than for purposes of subsection (b)(2)), 
wages as defined in section 3121(a) of such 
Code shall be determined without regard to 
paragraphs (1), (8), (10), (13), (18), (19), and 
(22) of section 3121(b) of such Code. 
(B) ALLOWANCE
FOR
CERTAIN
HEALTH 
PLAN EXPENSES.— 
(i) IN GENERAL.—Such term shall in-
clude amounts paid or incurred by the eli-
gible employer to provide and maintain a 
group health plan (as defined in section 
5000(b)(1) of the Internal Revenue Code 
of 1986), but only to the extent that such 
amounts are excluded from the gross in-
come of employees by reason of section 
106(a) of such Code. 
(ii) ALLOCATION
RULES.—For pur-
poses of this section, amounts treated as 
wages under clause (i) shall be treated as 
paid with respect to any employee (and 
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254 
with respect to any period) to the extent 
that such amounts are properly allocable to 
such employee (and to such period) in such 
manner as the Secretary may prescribe. 
Except as otherwise provided by the Sec-
retary, such allocation shall be treated as 
properly made if made on the basis of 
being pro rata among periods of coverage. 
(6) EMPLOYER.—The term ‘‘employer’’ means 
any employer (as defined in section 3401(d) of such 
Code) of at least one employee on any day in cal-
endar year 2020. 
(7) OTHER TERMS.—Except as otherwise pro-
vided in this section, any term used in this section 
which is also used in chapter 21 or 22 of the Inter-
nal Revenue Code of 1986 shall have the same 
meaning as when used in such chapter. 
(d) AGGREGATION RULE.—All persons treated as a 
single employer under subsection (a) or (b) of section 52 
of the Internal Revenue Code of 1986, or subsection (m) 
or (o) of section 414 of such Code, shall be treated as 
one employer for purposes of this section. 
(e) DENIAL OF DOUBLE BENEFIT.—For purposes of 
chapter 1 of such Code, the gross income of any eligible 
employer, for the taxable year which includes the last day 
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255 
of any calendar quarter with respect to which a credit is 
allowed under this section, shall be increased by the 
amount of such credit. 
(f) CERTAIN GOVERNMENTAL EMPLOYERS.— 
(1) IN GENERAL.—The credit under this section 
shall not be allowed to the Federal Government, the 
government of any State, of the District of Colum-
bia, or of any possession of the United States, any 
tribal government, or any political subdivision, agen-
cy, or instrumentality of any of the foregoing. 
(2) EXCEPTION.—Paragraph (1) shall not 
apply to any organization described in section 
501(c)(1) of the Internal Revenue Code of 1986 and 
exempt from tax under section 501(a) of such Code. 
(g) ELECTION NOT TO HAVE SECTION APPLY.—This 
section shall not apply with respect to any eligible em-
ployer for any calendar quarter if such employer elects (at 
such time and in such manner as the Secretary may pre-
scribe) not to have this section apply. 
(h) TRANSFERS TO CERTAIN TRUST FUNDS.—There 
are hereby appropriated to the Federal Old-Age and Sur-
vivors Insurance Trust Fund and the Federal Disability 
Insurance Trust Fund established under section 201 of 
the Social Security Act (42 U.S.C. 401) and the Social 
Security Equivalent Benefit Account established under 
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section 15A(a) of the Railroad Retirement Act of 1974 
(45 U.S.C. 231n–1(a)) amounts equal to the reduction in 
revenues to the Treasury by reason of this section (without 
regard to this subsection). Amounts appropriated by the 
preceding sentence shall be transferred from the general 
fund at such times and in such manner as to replicate 
to the extent possible the transfers which would have oc-
curred to such Trust Fund or Account had this section 
not been enacted. 
(i) TREATMENT OF DEPOSITS.—The Secretary shall 
waive any penalty under section 6656 of such Code for 
any failure to make a deposit of applicable employment 
taxes if the Secretary determines that such failure was due 
to the anticipation of the credit allowed under this section. 
(j) THIRD PARTY PAYORS.—Any credit allowed 
under this section shall be treated as a credit described 
in section 3511(d)(2) of such Code. 
(k) REGULATIONS AND GUIDANCE.—The Secretary 
shall issue such forms, instructions, regulations, and guid-
ance as are necessary— 
(1) to allow the advance payment of the credit 
under subsection (a), subject to the limitations pro-
vided in this section, based on such information as 
the Secretary shall require, 
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(2) regulations or other guidance to provide for 
the reconciliation of such advance payment with the 
amount of the credit at the time of filing the return 
of tax for the applicable quarter or taxable year, 
(3) with respect to the application of the credit 
under subsection (a) to third party payors (including 
professional employer organizations, certified profes-
sional employer organizations, or agents under sec-
tion 3504 of the Internal Revenue Code of 1986), 
including regulations or guidance allowing such 
payors to submit documentation necessary to sub-
stantiate the eligible employer status of employers 
that use such payors, 
(4) for application of subsection (b)(1)(A) and 
subparagraphs (A)(ii)(II) and (B) of subsection 
(c)(2) in the case of any employer which was not 
carrying on a trade or business for all or part of the 
same calendar quarter in the prior year, and 
(5) for recapturing the benefit of credits deter-
mined under this section in cases where there is a 
subsequent adjustment to the credit determined 
under subsection (a). 
(l) APPLICATION OF SECTION.—This section shall 
apply only to qualified fixed expenses paid or accrued after 
March 12, 2020, and before January 1, 2021. 
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