Title: ENCORES Act
Policy area: Taxation

Summary:
Entertainments New Credit Opportunity for Relief & Economic Sustainability Act or the ENCORES Act
This bill allows certain businesses and tax-exempt entities that conduct live events for which tickets are sold to the general public a tax credit for 50% of any refund made during the period beginning on January 31, 2020, and ending on the enactment date of this bill. The bill defines live event as any live concert, comedy show, sporting event, or theatrical production for which tickets were made available to the general public not less than six weeks prior to the event. The credit does not apply to an entity engaged in professional football, basketball, baseball, or other professional sport.
The ticket refund paid by the entity to a ticket purchaser for a live event includes events cancelled or postponed due to the COVID-19 (i.e., the coronavirus disease 2019) pandemic

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 4344 Introduced in Senate (IS)]

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116th CONGRESS
  2d Session
                                S. 4344

 To provide a tax credit to live event venues that provided refunds on 
tickets for events that were cancelled due to the coronavirus pandemic.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 28, 2020

Mr. Tester (for himself and Mr. Carper) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To provide a tax credit to live event venues that provided refunds on 
tickets for events that were cancelled due to the coronavirus pandemic.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Entertainments New Credit 
Opportunity for Relief and Economic Sustainability Act'' or the 
``ENCORES Act''.

SEC. 2. ESTABLISHMENT OF TAX CREDIT FOR TICKET REFUNDS ISSUED BY LIVE 
              EVENT VENUES.

    (a) In General.--Subject to subsections (b) and (c), for purposes 
of section 38 of the Internal Revenue Code of 1986, in the case of an 
eligible entity, the live event refund credit shall be treated as a 
credit listed at the end of subsection (b) of such section. For 
purposes of this subsection, the live event refund credit shall be an 
amount equal to 50 percent of any qualified ticket refund made by the 
eligible entity during the period--
            (1) beginning on January 31, 2020, and
            (2) ending on the date of enactment of this Act.
    (b) Limited Carryback of Credit.--In the case of the live event 
refund credit allowed under subsection (a)--
            (1) at the election of the eligible entity--
                    (A) such credit shall not be applied to the taxable 
                year in which the qualified ticket refunds were made by 
                such taxpayer and the amount of the credit with respect 
                to such refunds shall be reduced to zero for such 
                taxable year, and
                    (B) the amount of such credit shall be a live event 
                refund credit carryback to either of the 2 taxable 
                years preceding such taxable year, and
            (2) section 39 of the Internal Revenue Code of 1986 shall 
        not apply with respect to such credit.
    (c) Credit Made Available to Tax Exempt Entities.--
            (1) In general.--In the case of an eligible entity which is 
        an organization described in section 501(c) of the Internal 
        Revenue Code of 1986 which is exempt from taxation under 
        section 501(a) of such Code, there shall be treated as a credit 
        allowable under subpart C of part IV of subchapter A of chapter 
        1 of such Code (and not allowable under subpart D of such part) 
        the lesser of--
                    (A) the amount of the credit determined under 
                subsection (a) with respect to such entity, or
                    (B) the amount of the payroll taxes (as defined in 
                section 45R(f)(3) of such Code) of such entity during 
                the calendar year in which the taxable year begins, as 
                determined without regard to any credit against such 
                taxes.
            (2) Limited carryback.--Rules similar to subsection (b)(1) 
        shall apply for purposes of this subsection.
    (d) Definitions.--For purposes of this section--
            (1) Eligible entity.--
                    (A) In general.--The term ``eligible entity'' means 
                a person engaged in a trade or business which--
                            (i) includes--
                                    (I) organizing, promoting, 
                                producing, or managing live events, and
                                    (II) the sale to members of the 
                                general public (directly or through a 
                                third party) of tickets to attend such 
                                events, and
                            (ii) for the preceding taxable year, had an 
                        average number of full-time equivalent 
                        employees (as defined in section 45R(d)(2) of 
                        the Internal Revenue Code of 1986) which is 
                        equal to or less than 500.
                    (B) Aggregation rule.--All persons treated as a 
                single employer under subsection (b), (c), (m), or (o) 
                of section 414 of the Internal Revenue Code of 1986 
                shall be treated as a single taxpayer for purposes of 
                subparagraph (A).
                    (C) Exclusion.--The term ``eligible entity'' shall 
                not include any person engaged in professional 
                football, basketball, baseball, or other professional 
                sport.
            (2) Live event.--The term ``live event'' means any live 
        concert, comedy show, sporting event, or theatrical production 
        for which tickets were made available to members of the general 
        public by the eligible entity not less than 6 weeks prior to 
        such concert, show, event, or production.
            (3) Qualified ticket refund.--The term ``qualified ticket 
        refund'' means any refund paid by the eligible entity to an 
        individual who purchased a ticket which entitled such 
        individual to attend a live event which was cancelled or 
        postponed due to the virus SARS-CoV-2 or coronavirus disease 
        2019 (COVID-19), provided that--
                    (A) the eligible entity made a good faith effort to 
                offer such individual the option to receive a voucher 
                or discount for any live event at a later date in an 
                amount which was equal to or greater than the price 
                paid by such individual for such ticket, and
                    (B) such individual elected to receive a refund.
            (4) Other terms.--Except as otherwise provided under this 
        subsection, any term used in this section which is also used in 
        chapter 1 of the Internal Revenue Code of 1986 shall have the 
        meaning given such term under such chapter.
    (e) Denial of Double Benefit.--No deduction shall be allowed under 
any provision of chapter 1 of the Internal Revenue Code of 1986 with 
respect to any amount taken in account in determining the credit 
allowed to a taxpayer under this section.
    (f) Regulations and Guidance.--The Secretary of the Treasury (or 
the Secretary's delegate) may prescribe such regulations and other 
guidance as may be appropriate or necessary to carry out the purposes 
of this section.
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