I 
111TH CONGRESS 
1ST SESSION H. R. 1644 
To amend the Internal Revenue Code of 1986 to provide for a tax credit 
for qualified donations of employee services. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 19, 2009 
Mr. LEWIS of Georgia introduced the following bill; which was referred to the 
Committee on Ways and Means, and in addition to the Committee on 
Education and Labor, for a period to be subsequently determined by the 
Speaker, in each case for consideration of such provisions as fall within 
the jurisdiction of the committee concerned 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
for a tax credit for qualified donations of employee services. 
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 ‘‘Incentive to Serve Tax 
Act’’. 
SEC. 2. TAX CREDIT FOR QUALIFIED DONATIONS OF EM-
PLOYEE SERVICES. 
(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 is amended by adding at the end the following new 
section: 
‘‘SEC. 45R. QUALIFIED EMPLOYEE SERVICE DONATIONS. 
‘‘(a) IN GENERAL.—For purposes of section 38, the 
qualified employee service donation credit under this sec-
tion is an amount equal to 25 percent of the qualified 
wages paid or incurred by the taxpayer. 
‘‘(b) QUALIFIED WAGES.—For purposes of this sec-
tion— 
‘‘(1) IN GENERAL.—The term ‘qualified wages’ 
means the wages paid or incurred by an employer 
during the taxable year to an eligible employee dur-
ing periods in which the eligible employee is per-
forming qualified services. 
‘‘(2) WAGES.—The term ‘wages’ has the mean-
ing given to such term by subsection (b) of section 
3306 (determined without regard to the dollar limi-
tation contained in such section). 
‘‘(3) LIMITATION ON WAGES TAKEN INTO AC-
COUNT.—The amount of qualified wages which may 
be taken into account with respect to any individual 
shall not exceed $100,000 per year. 
‘‘(4) COORDINATION WITH OTHER CREDITS.— 
‘‘(A) WORK OPPORTUNITY CREDIT.—The 
term ‘qualified wages’ shall not include wages 
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attributable to service rendered during the 1- 
year period beginning with the day the indi-
vidual begins work for the employer if any por-
tion of such wages is taken into account in de-
termining the credit under section 51. 
‘‘(B) INDIAN EMPLOYMENT CREDIT.—The 
term ‘qualified wages’ shall not include wages 
with respect to any employee if a credit is al-
lowed for wages paid to such employee under 
section 45A. 
‘‘(c) ELIGIBLE EMPLOYEE.—For purposes of this 
section, the term ‘eligible employee’ means any employee 
of the employer who performs qualified services at the di-
rection of the employer and with the employee’s consent 
for a period of not less than 160 hours for which such 
employee was fully compensated during the taxable year 
of the employer. 
‘‘(d) QUALIFIED SERVICES.—For purposes of this 
section— 
‘‘(1) IN GENERAL.—The term ‘qualified serv-
ices’ means— 
‘‘(A) eligible direct services to recipients or 
beneficiaries of charitable organizations and 
community agencies, 
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‘‘(B) the recruitment and coordination of 
activities of volunteers providing such eligible 
direct services, or 
‘‘(C) the building of the capacity of such 
organizations and agencies to provide such eligi-
ble direct services. 
‘‘(2) ELIGIBLE DIRECT SERVICES.—The term 
‘eligible direct services’ means direct services which 
advance 1 or more of the following: 
‘‘(A) Improving the quality of education in 
public schools for economically disadvantaged 
students. 
‘‘(B) Expanding and improving access to 
health care. 
‘‘(C) Improving and conserving energy and 
natural resources. 
‘‘(D) Improving economic opportunities for 
economically disadvantaged individuals. 
‘‘(E) Improving disaster preparedness and 
response. 
‘‘(e) VERIFICATION.—No amount shall be allowed as 
a credit under subsection (a) for qualified wages for quali-
fied services with respect to which the taxpayer has not 
submitted such information or certification as the Sec-
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retary determines necessary to ensure the performance of 
such qualified services. 
‘‘(f) SPECIAL RULES.—For purposes of this section, 
rules similar to the rules of section 52 shall apply.’’. 
(b) CREDIT TREATED AS BUSINESS CREDIT.—Sec-
tion 38(b) of the Internal Revenue Code of 1986 (relating 
to current year business credit) is amended by striking 
‘‘plus’’ at the end of paragraph (34), by striking the period 
at the end of paragraph (35) and inserting ‘‘, plus’’, and 
by adding at the end the following new paragraph: 
‘‘(36) the credit determined under section 
45R(a).’’. 
(c) CONFORMING AMENDMENTS.— 
(1) Section 196(c) of the Internal Revenue 
Code of 1986 is amended by striking ‘‘and’’ at the 
end of paragraph (12), by striking the period at the 
end of paragraph (13) and inserting ‘‘, and’’, and by 
adding at the end the following new paragraph: 
‘‘(14) the qualified employee service credit 
under section 45R(a).’’. 
(2) Section 280C(a) of such Code is amended 
by inserting ‘‘45R(a),’’ after ‘‘45P(a),’’. 
(d) CLERICAL AMENDMENT.—The table of sections 
for subpart D of part IV of subchapter A of chapter 1 
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of the Internal Revenue Code of 1986 is amended by add-
ing at the end the following new item: 
‘‘Sec. 45R. Qualified employee service donations.’’. 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall apply to wages paid or incurred after 
the date of the enactment of this Act. 
SEC. 3. EXCLUSION. 
Section 148 of the National and Community Service 
Act of 1990 (42 U.S.C. 12604) is amended— 
(1) by redesignating subsection (g) as sub-
section (h); and 
(2) by inserting after subsection (f) the fol-
lowing: 
‘‘(g) EXCLUSION FROM INCOME.—The amount of an 
educational award provided to an individual under this 
section shall not be included in the gross income of the 
individual for purposes of the Internal Revenue Code of 
1986.’’. 
Æ 
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