I 
111TH CONGRESS 
1ST SESSION H. R. 4056 
To amend the Internal Revenue Code of 1986 to allow small businesses 
a credit against income tax for increasing employment. 
IN THE HOUSE OF REPRESENTATIVES 
NOVEMBER 6, 2009 
Mr. SESTAK introduced the following bill; which was referred to the 
Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to allow small 
businesses a credit against income tax for increasing 
employment. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Jobs Opportunity and 
Business Stability Act of 2009’’. 
SEC. 2. CREDIT FOR SMALL BUSINESSES THAT INCREASE 
EMPLOYMENT. 
(a) IN GENERAL.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of 
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1986 (relating to business-related credits) is amended by 
adding at the end the following new section: 
‘‘SEC. 45R. CREDIT FOR SMALL BUSINESSES THAT IN-
CREASE EMPLOYMENT. 
‘‘(a) GENERAL RULE.—In the case of an eligible 
small business employer, the increased small business em-
ployment credit determined under this section shall be— 
‘‘(1) for any taxable year beginning in 2010, an 
amount equal to 15 percent of the excess of— 
‘‘(A) the aggregate wages paid during 
2010, over 
‘‘(B) 102 percent of the aggregate wages 
paid during 2009, and 
‘‘(2) for any taxable year beginning in 2011, an 
amount equal to 10 percent of the excess of— 
‘‘(A) the aggregate wages paid during 
2011, over 
‘‘(B) 102 percent of the aggregate wages 
paid during 2010. 
‘‘(b) MINIMUM PRECEDING YEAR WAGES.—For pur-
poses of subsection (a)— 
‘‘(1) the amount taken into account under para-
graph (1)(B) thereof shall not be less than 50 per-
cent of the amount described in paragraph (1)(A) 
thereof, and 
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‘‘(2) the amount taken into account under para-
graph (2)(B) thereof shall not be less than 50 per-
cent of the amount described in paragraph (2)(A) 
thereof. 
‘‘(c) TOTAL WAGES MUST INCREASE.—The amount 
of credit determined under this section for any taxable 
year shall not exceed the amount which would be so deter-
mined for such year (without regard to subsection (b)) 
if— 
‘‘(1) the aggregate amounts taken into account 
as wages were determined without any dollar limita-
tion, and 
‘‘(2) ‘105 percent’ were substituted for ‘102 
percent’ in the appropriate subparagraph of sub-
section (a). 
‘‘(d) ELIGIBLE SMALL BUSINESS EMPLOYER.—For 
purposes of this section, the term ‘eligible small business 
employer’ means, with respect to any taxable year, any 
employer if— 
‘‘(1) such employer employed an average of less 
than 20 employees on business days during the pre-
ceding taxable year, and 
‘‘(2) such employer (and any predecessor) met 
the gross receipts test of section 448(c) for the pre-
ceding taxable year. 
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‘‘(e) WAGES.—For purposes of this section— 
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), the term ‘wages’ has the meaning given 
to such term by section 3121(a) with respect to the 
tax imposed by section 3101(a). 
‘‘(2) RAILWAY LABOR.—In the case of remu-
neration subject to the tax imposed by 3201(a), the 
term ‘wages’ means so much of compensation (as de-
fined in section 3231(e)) for the calendar year as 
does not exceed the contribution and benefit base de-
termined under section 230 of the Social Security 
Act for such calendar year. 
‘‘(f) CERTAIN RULES TO APPLY.—Rules similar to 
the following rules shall apply for purposes of this section: 
‘‘(1) Section 51(f) (relating to remuneration 
must be for trade or business employment). 
‘‘(2) Section 51(k) (relating to treatment of 
successor employers; treatment of employees per-
forming services for other persons). 
‘‘(3) Subsections (a) and (b) of section 52 (re-
lating to controlled groups). 
‘‘(g) ELECTION TO HAVE CREDIT NOT APPLY.— 
‘‘(1) IN GENERAL.—A taxpayer may elect to 
have this section not apply for any taxable year. 
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‘‘(2) TIME FOR MAKING ELECTION.—An elec-
tion under paragraph (1) for any taxable year may 
be made (or revoked) at any time before the expira-
tion of the 3-year period beginning on the last date 
prescribed by law for filing the return for such tax-
able year (determined without regard to exten-
sions).’’. 
(b) DENIAL OF DOUBLE BENEFIT.—Subsection (a) 
of section 280C of such Code is amended by inserting 
‘‘45R(a),’’ after ‘‘45P(a),’’. 
(c) CREDIT MADE PART OF GENERAL BUSINESS 
CREDIT.— 
(1) IN GENERAL.—Subsection (b) of section 38 
of such Code (relating to current year business cred-
it) is amended by striking ‘‘plus’’ at the end of para-
graph (34), by striking the period at the end of 
paragraph (35) and inserting ‘‘, plus’’, and by add-
ing at the end the following new paragraph: 
‘‘(36) in the case of an eligible small business 
employer (as defined in section 45R(e)), the in-
creased small business employment credit deter-
mined under section 45R(a).’’. 
(2) DEDUCTION FOR CERTAIN UNUSED BUSI-
NESS CREDITS.—Subsection (c) of section 196 of 
such Code is amended by striking ‘‘and’’ at the end 
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the credit determined under section 45R), 
and 
‘‘(iii) the amount of the credit deter-
mined under section 45R in excess of the 
limitation under paragraph (1) (as modi-
fied by clause (ii)) shall be treated as a 
credit under subpart C.’’. 
(e) CLERICAL AMENDMENT.—The table of sections 
for subpart D of part IV of subchapter A of chapter 1 
of such Code is amended by inserting after the item relat-
ing to section 45Q the following new item: 
‘‘Sec. 45R. Credit for small businesses that increase employment.’’. 
(f) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2009. 
(g) PUBLIC INFORMATION CAMPAIGN.—The Sec-
retary of the Treasury (or the Secretary’s delegate) shall 
undertake a public information campaign to make employ-
ers aware of the credit added by this Act. 
(h) STUDY TO PROVIDE COMPARABLE BENEFITS TO 
NONPROFIT
ORGANIZATIONS.—The Secretary of the 
Treasury (or the Secretary’s delegate) shall conduct a 
study on ways to provide benefits to nonprofit organiza-
tions which are comparable to the credit added by the Act. 
The results of such study shall be submitted to the Com-
mittee on Ways and Means of the House of Representa-
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tives and the Committee on Finance of the Senate not 
later than 90 days after the date of the enactment of this 
Act. 
Æ 
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