Title: To provide a payroll tax credit for certain costs of providing employees with testing for COVID-19.
Policy area: Taxation

Summary:
This bill allows employers a payroll tax credit for 50% of employee testing expenses for COVID-19 (i.e., coronavirus disease 2019). The credit does not apply to the federal government or any state or local government.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7658 Introduced in House (IH)]

<DOC>






116th CONGRESS
  2d Session
                                H. R. 7658

    To provide a payroll tax credit for certain costs of providing 
                  employees with testing for COVID-19.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 16, 2020

Mr. Schweikert introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
    To provide a payroll tax credit for certain costs of providing 
                  employees with testing for COVID-19.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. EMPLOYEE TESTING TAX CREDIT.

    (a) In General.--In the case of an employer, there shall be allowed 
as a credit against applicable employment taxes for each calendar 
quarter an amount equal to 50 percent of the qualified employee testing 
expenses paid or incurred by the employer during such calendar quarter.
    (b) Limitations and Refundability.--
            (1) Overall dollar limitation on credit.--
                    (A) In general.--The amount of the credit allowed 
                under subsection (a) with respect to any employer for 
                any calendar quarter shall not exceed the excess (if 
                any) of--
                            (i) the applicable dollar limit with 
                        respect to such employer for such calendar 
                        quarter, over
                            (ii) the aggregate credits allowed under 
                        subsection (a) with respect to such employer 
                        for all preceding calendar quarters.
                    (B) Applicable dollar limit.--The term ``applicable 
                dollar limit'' means, with respect to any employer for 
                any calendar quarter, the sum of--
                            (i) $500, multiplied so much of the average 
                        number of full-time employees (as determined 
                        for purposes of determining whether an employer 
                        is an applicable large employer for purposes of 
                        section 4980H(c)(2) of the Internal Revenue 
                        Code of 1986, except that an individual shall 
                        not be taken into account as employee for any 
                        period during which substantially all of the 
                        services provided by such individual as an 
                        employee are provided outside the United 
                        States) employed by such employer during such 
                        calendar quarter as does not exceed 500, plus
                            (ii) $375, multiplied by so much of such 
                        average number of full-time employees as 
                        exceeds 500 but does not exceed 1,000, plus
                            (iii) $250, multiplied by so much of such 
                        average number of full-time employees as 
                        exceeds 1,000.
            (2) Credit limited to employment taxes.--The credit allowed 
        by subsection (a) with respect to any calendar quarter shall 
        not exceed the applicable employment taxes (reduced by any 
        credits allowed under subsections (e) and (f) of section 3111 
        of the Internal Revenue Code of 1986, sections 7001 and 7003 of 
        the Families First Coronavirus Response Act, and section 2301 
        of the CARES Act) 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 limitation 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 purposes of section 
                1324 of title 31, United States Code, any amounts due 
                to the 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) Qualified Employee Testing Expenses.--For purposes of this 
section, the term ``qualified employee testing expenses'' means amounts 
paid or incurred by the employer for testing employees of the employer 
for COVID-19 or SARS-CoV-2 (including on a periodic basis).
    (d) Other Definitions.--For purposes of this section--
            (1) Applicable employment taxes.--The term ``applicable 
        employment 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 attributable to the rate in 
                effect under section 3111(a) of such Code.
            (2) Secretary.--The term ``Secretary'' means the Secretary 
        of the Treasury or the Secretary's delegate.
            (3) Other terms.--Any term used in this section (other than 
        subsection (b)(1)(B)) which is also used in chapter 21 or 22 of 
        the Internal Revenue Code of 1986 shall have the same meaning 
        as when used in such chapter.
    (e) Certain Governmental Employers.--This credit shall not apply to 
the Government of the United States, the government of any State or 
political subdivision thereof, or any agency or instrumentality of any 
of the foregoing.
    (f) Special Rules.--
            (1) 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.
            (2) Denial of double benefit.--Rules similar to the rules 
        of section 280C(a) of the Internal Revenue Code of 1986 shall 
        apply for purposes of this section.
            (3) Third-party payors.--Any credit allowed under this 
        section shall be treated as a credit described in section 
        3511(d)(2) of such Code.
            (4) Election not to have section apply.--This section shall 
        not apply with respect to any eligible employer for any 
        calendar quarter if such employer elects (at such time and in 
        such manner as the Secretary may prescribe) not to have this 
        section apply.
    (g) Transfers to Certain Trust Funds.--There are hereby 
appropriated to the Federal Old-Age and Survivors 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 section 15A(a) of 
the Railroad Retirement Act of 1974 (45 U.S.C. 14 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 occurred to such Trust Fund or Account 
had this section not been enacted.
    (h) Treatment of Deposits.--The Secretary shall waive any penalty 
under section 6656 of the Internal Revenue Code of 1986 for any failure 
to make a deposit of any applicable employment taxes if the Secretary 
determines that such failure was due to the reasonable anticipation of 
the credit allowed under this section.
    (i) Regulations and Guidance.--The Secretary shall prescribe such 
regulations and other guidance as may be necessary or appropriate to 
carry out the purposes of this section, including--
            (1) with respect to the application of the credit under 
        subsection (a) to third-party payors (including professional 
        employer organizations, certified professional employer 
        organizations, or agents under section 3504 of the Internal 
        Revenue Code of 1986), regulations or other guidance allowing 
        such payors to submit documentation necessary to substantiate 
        the amount of the credit allowed under subsection (a), and
            (2) regulations or other guidance to prevent abusive 
        transactions.
    (j) Application.--This section shall only apply to amounts paid or 
incurred after March 12, 2020, and before January 1, 2021.
                                 <all>