I 
111TH CONGRESS 
1ST SESSION H. R. 1836 
To amend the Internal Revenue Code of 1986 to provide a payroll tax 
holiday for small businesses. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 1, 2009 
Mr. MINNICK (for himself and Mr. SCHOCK) 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 provide 
a payroll tax holiday for small businesses. 
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 ‘‘Payroll Tax Holiday 
Act of 2009’’. 
SEC. 2. PAYROLL TAX HOLIDAY FOR SMALL BUSINESSES. 
(a) IN GENERAL.—Subchapter C of chapter 21 of the 
Internal Revenue Code of 1986 (relating to Federal Insur-
ance Contributions Act) is amended by redesignating sec-
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tion 3128 as section 3129 and by inserting after section 
3127 the following new section: 
‘‘SEC. 3128. PAYROLL TAX HOLIDAY FOR SMALL BUSI-
NESSES DURING PORTION OF 2009. 
‘‘(a) PAYROLL TAXES.—In the case of an eligible 
small business, the rate of the taxes imposed by sections 
3101(a) and 3111(a) shall be zero with respect to remu-
neration paid during the payroll tax holiday period, includ-
ing for purposes of determining the rates of tax under sec-
tions 3201(a) and 3221(a) with respect to compensation 
paid during such period. 
‘‘(b) SELF-EMPLOYMENT TAXES.—In the case of an 
eligible small business— 
‘‘(1) IN GENERAL.—For purposes of the tax im-
posed by section 1401(a), the self-employment in-
come of the taxpayer for the taxable year (deter-
mined without regard to this subsection) shall be re-
duced by the payroll tax holiday period income for 
such taxable year. 
‘‘(2) TAX
ON
EMPLOYEE
REPRESENTATIVES 
UNDER THE RAILROAD RETIREMENT TAX ACT.—For 
purposes of the tax imposed by section 3211(a), the 
compensation of the taxpayer subject to tax under 
such section for the taxable year (determined with-
out regard to this subsection) shall be reduced by 
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‘‘(A) IN
GENERAL.—The term ‘eligible 
small business’ means any person engaged in a 
trade or business if such person employed no 
more than 50 employees on the first day of the 
payroll tax holiday period. 
‘‘(B) SPECIAL
RULES.—For purposes of 
subparagraph (A)— 
‘‘(i) all persons treated as a single em-
ployer under subsection (b), (c), (m), or 
(o) of section 414 shall be treated as 1 tax-
payer, and 
‘‘(ii) temporary lay-offs shall be dis-
regarded. 
‘‘(2) PAYROLL
TAX
HOLIDAY
PERIOD.—The 
term ‘payroll tax holiday period’ means the period— 
‘‘(A) after the last day of the month which 
includes the date of the enactment of this sec-
tion, and 
‘‘(B) before January 1, 2010. 
‘‘(d) LIMITATION
ON REDUCTION
IN EMPLOYER 
TAXES.— 
‘‘(1) IN GENERAL.—If at the close of the pay-
roll tax holiday period— 
‘‘(A) the aggregate reduction under this 
section in the employer taxes, exceeds 
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‘‘(B) the aggregate increase in employee 
compensation or capital expenditures during the 
payroll tax holiday period as compared to the 
comparable period ending on the day before the 
payroll tax holiday period, 
then the applicable employer tax (determined with-
out regard to this subsection) for the first payroll 
period beginning after the payroll tax holiday period 
shall be increased by such excess. 
‘‘(2) EMPLOYER TAXES.—For purposes of sub-
paragraph (A), the term ‘employer taxes’ means— 
‘‘(A) the taxes imposed by sections 
3111(a) and 3221(a), and 
‘‘(B) so much of the taxes imposed by sec-
tions 1401(a) and 3211(a) as does not exceed 
the tax determined at the rate imposed by sec-
tion 3111(a). 
‘‘(e) TRUST FUNDS HELD HARMLESS.—There are 
hereby appropriated (out of any money in the Treasury 
not otherwise appropriated) for each fiscal year to the 
trust funds under section 201 of the Social Security Act 
and the Social Security Equivalent Benefit Account under 
section 15A of the Railroad Retirement Act of 1974 (45 
U.S.C. 231n–1) an amount equal to the reduction in the 
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transfers to such fund for such fiscal year by reason of 
this section. 
‘‘(f) EMPLOYER NOTIFICATION.—The Secretary shall 
notify small business employers of the payroll tax holiday 
period in any manner the Secretary deems appropriate.’’. 
(b) CONFORMING AMENDMENT.—The table of sec-
tions for such subchapter C is amended by redesignating 
the item relating to section 3128 as relating to section 
3129 and by inserting after the item relating to section 
3127 the following new item: 
‘‘Sec. 3128. Payroll tax holiday for small businesses during portion of 2009.’’. 
(c) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section 
shall apply to remuneration paid after the last day 
of the month which includes the date of the enact-
ment of this Act. 
(2) SELF-EMPLOYMENT
TAXES.—So much of 
section 3128 of the Internal Revenue Code of 1986 
(as added by this section) as relates to the taxes im-
posed by sections 1401(a) and 3211(a) shall apply 
to taxable years ending after such last day. 
Æ 
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