(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 sections 101, 102, and 304 of this 
division, for such quarter) on the wages paid with 
respect to the employment of all the employees of 
the eligible 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, 
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 
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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— 
(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 
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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 
(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, 
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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 80 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 80 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 
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 
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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 ‘‘80 
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) 30 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— 
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(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— 
(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 
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