Title: Local Journalism Sustainability Act
Policy area: Taxation

Summary:
Local Journalism Sustainability Act
This bill allows individual taxpayers a tax credit up to $250 in any taxable year for subscriptions to one or more local newspapers for the taxpayer's personal use. It also allows a local news journalist employer a payroll credit for wages paid to local news journalists.
The bill allows certain small businesses a tax credit for amounts paid for advertising in a local newspaper or through a broadcast of a radio or television station serving a local community.

[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 2434 Introduced in Senate (IS)]

<DOC>






117th CONGRESS
  1st Session
                                S. 2434

To provide tax incentives that support local newspapers and other local 
                     media, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 22, 2021

  Ms. Cantwell (for herself, Mr. Kelly, and Mr. Wyden) introduced the 
 following bill; which was read twice and referred to the Committee on 
                                Finance

_______________________________________________________________________

                                 A BILL


 
To provide tax incentives that support local newspapers and other local 
                     media, and for other purposes.

    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 ``Local Journalism Sustainability 
Act''.

SEC. 2. CREDIT FOR LOCAL NEWSPAPER SUBSCRIPTIONS.

    (a) In General.--Subpart A of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by inserting after 
section 25D the following new section:

``SEC. 25E. LOCAL NEWSPAPER SUBSCRIPTIONS.

    ``(a) In General.--In the case of an individual, there shall be 
allowed as a credit against the tax imposed by this chapter for the 
taxable year an amount equal to the applicable percentage of amounts 
paid or incurred for subscriptions to one or more local newspapers for 
the personal use of the taxpayer.
    ``(b) Annual Dollar Limitation.--The credit allowed under 
subsection (a) to any taxpayer for any taxable year shall not exceed 
$250.
    ``(c) Applicable Percentage.--For purposes of this section, the 
term `applicable percentage' means--
            ``(1) in the case of the first taxable year to which this 
        section applies, 80 percent, and
            ``(2) in the case of any subsequent taxable year, 50 
        percent.
    ``(d) Local Newspaper.--For purposes of this section--
            ``(1) In general.--The term `local newspaper' means any 
        print or digital publication if--
                    ``(A) the primary content of such publication is 
                original content derived from primary sources and 
                relating to news and current events,
                    ``(B) such publication primarily serves the needs 
                of a regional or local community,
                    ``(C) the publisher of such publication employs at 
                least one local news journalist who resides in such 
                regional or local community, and
                    ``(D) the publisher of such publication employs not 
                greater than 1,000 employees.
            ``(2) Local news journalist.--For purposes of paragraph 
        (1)(C), the term `local news journalist' means any individual 
        who regularly gathers, collects, photographs, records, writes, 
        or reports news or information that concerns local events or 
        other matters of local public interest.
            ``(3) Aggregation rule.--
                    ``(A) In general.--For purposes of subparagraphs 
                (C) and (D) of paragraph (1), all persons treated as a 
                single employer under subsection (a) or (b) of section 
                52, or subsection (m) or (o) of section 414, shall be 
                treated as one person.
                    ``(B) Exception.--Subparagraph (A) shall not apply 
                unless such persons are involved in the production of 
                the same print or digital publication.
            ``(4) Continuous qualification.--The requirements of 
        subparagraphs (A) and (B) of paragraph (1) shall not be treated 
        as met unless such requirements are met at all times during the 
        period beginning on the date which is 2 years before the date 
        of the enactment of this section and ending on the date that 
        the subscription described in subsection (a) is paid or 
        incurred.
            ``(5) Application to certain organizations exempt from 
        tax.--In the case of any print or digital publication which is 
        published by any organization described in section 501(c) and 
        exempt from tax under section 501(a)--
                    ``(A) such publication shall be treated as a local 
                newspaper only if the publication of print and digital 
                publications is the primary activity of such 
                organization, and
                    ``(B) any person making a charitable contribution 
                (as defined in section 170(c)) to such organization may 
                elect to treat such contribution as an amount paid or 
                incurred for a subscription to which this section 
                applies in lieu of treating such contribution as a 
                charitable contribution for purposes of section 170.
    ``(e) Termination.--No credit shall be allowed under this section 
for any amount paid or incurred in a taxable year ending after the 
close of 5-year period beginning on the date of the enactment of this 
section.''.
    (b) Clerical Amendment.--The table of sections for subpart A of 
part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
1986 is amended by inserting after the item relating to section 25D the 
following new item:

``Sec. 25E. Local newspaper subscriptions.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred in taxable years beginning after the 
date of the enactment of this Act.

SEC. 3. PAYROLL CREDIT FOR COMPENSATION OF LOCAL NEWS JOURNALISTS.

    (a) In General.--Subchapter D of chapter 21 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new section:

``SEC. 3135. LOCAL NEWS JOURNALIST COMPENSATION CREDIT.

    ``(a) In General.--In the case of an eligible local news journalist 
employer, there shall be allowed as a credit against the taxes imposed 
by section 3111(a) for each calendar quarter an amount equal to the 
applicable percentage of wages paid by such employer to local news 
journalists for such calendar quarter.
    ``(b) Limitations and Refundability.--
            ``(1) Wages taken into account.--The amount of wages paid 
        with respect to any individual which may be taken into account 
        under subsection (a) during any calendar quarter by the 
        eligible local news journalist employer shall not exceed 
        $12,500.
            ``(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, section 3131, 3132, and 3134) on the wages paid with 
        respect to the employment of all the employees of the eligible 
        local news journalist employer for such calendar quarter.
            ``(3) Refundability of excess credit.--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).
    ``(c) Definitions.--For purposes of this section--
            ``(1) Applicable percentage.--The term `applicable 
        percentage' means--
                    ``(A) in the case of each of the first 4 calendar 
                quarters to which this section applies, 50 percent, and
                    ``(B) in the case of each calendar quarter 
                thereafter, 30 percent.
            ``(2) Eligible local news journalist employer.--
                    ``(A) In general.--The term `eligible local news 
                journalist employer' means, with respect to any 
                calendar quarter, any employer which--
                            ``(i) is--
                                    ``(I) an eligible local newspaper 
                                publisher,
                                    ``(II) an eligible digital news 
                                organization,
                                    ``(III) a broadcast station, or
                                    ``(IV) a public broadcasting 
                                entity, and
                            ``(ii) employs local news journalists.
                    ``(B) Eligible local newspaper publisher.--The term 
                `eligible local newspaper publisher' means, with 
                respect to any calendar quarter, any employer if 
                substantially all of the gross receipts of such 
                employer for such calendar quarter are derived in the 
                trade or business of publishing local newspapers (as 
                defined in section 25E(d)(1)).
                    ``(C) Eligible digital news organization.--The term 
                `eligible digital news organization' means a digital 
                information content provider which is engaged in the 
                creation of original local or regional news and 
                information.
                    ``(D) Broadcast station.--The term `broadcast 
                station' has the meaning given such term under section 
                3 of the Communications Act of 1934 (47 U.S.C. 153).
                    ``(E) Public broadcasting entity.--The term `public 
                broadcasting entity' has the meaning given such term 
                under section 397(11) of the Communications Act of 1934 
                (47 U.S.C. 397(11)).
            ``(3) Local news journalist.--The term `local news 
        journalist' means--
                    ``(A) with respect to any eligible local newspaper 
                publisher for any calendar quarter, any individual who 
                provides at least 100 hours of service during such 
                quarter in the gathering, collecting, photographing, 
                recording, writing, or reporting news or information 
                that concerns local events or other matters of local 
                public interest during such calendar quarter to such 
                employer, and
                    ``(B) with respect to any eligible digital news 
                organization, broadcast station, or public broadcasting 
                entity for any calendar quarter, any individual who 
                provides at least 100 hours of service during such 
                quarter in the original reporting, gathering, 
                collecting, writing, editing, producing, verification, 
                recording, photographing, presentation, design, or 
                technology support of news or information that concerns 
                regional or local events or other matters of regional 
                or local public interest.
            ``(4) Other terms.--Any term used in this section which is 
        also used in this chapter shall have the same meaning as when 
        used in such chapter.
    ``(d) Aggregation Rule.--
            ``(1) In general.--All persons treated as a single employer 
        under subsection (a) or (b) of section 52, or subsection (m) or 
        (o) of section 414, shall be treated as one employer for 
        purposes of this section.
            ``(2) Exception.--Paragraph (1) shall not apply unless such 
        persons are involved in the production of the same print or 
        digital publication.
    ``(e) Certain Rules To Apply.--For purposes of this section, rules 
similar to the rules of sections 51(i)(1) and 280C(a) shall apply.
    ``(f) Certain Governmental Employers.--
            ``(1) In general.--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.
            ``(2) Exception.--Paragraph (1) shall not apply to any 
        public broadcasting entity (as defined in section 397(11) of 
        the Communications Act of 1934 (47 U.S.C. 397(11))).
    ``(g) Election To Have Section Not Apply.--This section shall not 
apply with respect to any eligible local news journalist employer for 
any calendar quarter if such person elects (at such time and in such 
manner as the Secretary may prescribe) not to have this section apply.
    ``(h) Special Rules.--
            ``(1) Employee not taken into account more than once.--An 
        employee shall not be included for purposes of this section for 
        any period with respect to any employer if such employer is 
        allowed a credit under section 51 with respect to such employee 
        for such period.
            ``(2) Denial of double benefit.--Any wages taken into 
        account in determining the credit allowed under this section 
        shall not be taken into account for purposes of determining the 
        credit allowed under section 45S.
            ``(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.
    ``(i) Treatment of Deposits.--The Secretary shall waive any penalty 
under section 6656 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.
    ``(j) Extension of Limitation on Assessment.--Notwithstanding 
section 6501, the limitation on the time period for the assessment of 
any amount attributable to a credit claimed under this section shall 
not expire before the date that is 5 years after the later of--
            ``(1) the date on which the original return which includes 
        the calendar quarter with respect to which such credit is 
        determined is filed, or
            ``(2) the date on which such return is treated as filed 
        under section 6501(b)(2).
    ``(k) Regulations and Guidance.--The Secretary shall issue such 
forms, instructions, regulations, and guidance as are necessary--
            ``(1) to allow the advance payment of the credit under 
        subsection (a), subject to the limitations provided in this 
        section, based on such information as the Secretary shall 
        require,
            ``(2) to provide for the reconciliation of such advance 
        payment with the amount advanced at the time of filing the 
        return of tax for the applicable calendar quarter or taxable 
        year,
            ``(3) 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), including 
        regulations or guidance allowing such payors to submit 
        documentation necessary to substantiate the eligible employer 
        status of employers that use such payors, and
            ``(4) to prevent the avoidance of the purposes of the 
        limitations under this section.
Any forms, instructions, regulations, or other guidance described in 
paragraph (3) shall require the customer to be responsible for the 
accounting of the credit and for any liability for improperly claimed 
credits and shall require the certified professional employer 
organization or other third-party payor to accurately report such tax 
credits based on the information provided by the customer.
    ``(l) Application.--This section shall only apply to wages paid in 
calendar quarters beginning after the date of the enactment of this 
section and beginning before the date that is 5 years after the first 
day of the first calendar quarter to which this section applies.''.
    (b) Refunds.--Paragraph (2) of section 1324(b) of title 31, United 
States Code, is amended by inserting ``3135,'' after ``3134,''.
    (c) Clerical Amendment.--The table of sections for subchapter D of 
chapter 21 of the Internal Revenue Code of 1986 is amended by adding at 
the end the following:

``Sec. 3135. Local news journalist compensation credit.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to calendar quarters beginning after the date of the enactment of 
this Act.

SEC. 4. CREDIT FOR ADVERTISING IN LOCAL NEWSPAPERS AND LOCAL MEDIA.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new section:

``SEC. 45U. ADVERTISING IN LOCAL NEWSPAPERS AND LOCAL MEDIA.

    ``(a) In General.--For purposes of section 38, in the case of any 
eligible small business, the local media advertising credit determined 
under this section for any taxable year is an amount equal to the 
applicable percentage of the qualified local media advertising expenses 
paid or incurred by the taxpayer during such taxable year.
    ``(b) Limitation.--The credit allowed under subsection (a) to any 
taxpayer for any taxable year shall not exceed--
            ``(1) in the case of the first taxable year to which this 
        section applies, $5,000, and
            ``(2) in the case of any subsequent taxable year, $2,500.
    ``(c) Applicable Percentage.--For purposes of this section, the 
term `applicable percentage' means--
            ``(1) in the case of the first taxable year to which this 
        section applies, 80 percent, and
            ``(2) in the case of any subsequent taxable year, 50 
        percent.
    ``(d) Eligible Small Business.--For purposes of this section, the 
term `eligible small business' means any person for any taxable year if 
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) 
employed by such person during such taxable year was less than 50.
    ``(e) Qualified Local Media Advertising Expenses.--For purposes of 
this section--
            ``(1) In general.--The term `qualified local media 
        advertising expenses' means amounts paid or incurred in the 
        ordinary course of a trade or business for advertising--
                    ``(A) in a local newspaper (as defined in section 
                25E(d)), or
                    ``(B) through a broadcast of, or in the digital 
                content or digital publications of, a local radio or 
                television station.
            ``(2) Local radio or television station.--The term `local 
        radio or television station' means any broadcast radio or 
        television station licensed by the Federal Communications 
        Commission to serve a local community.
    ``(f) Special Rules.--
            ``(1) Denial of double benefit.--No deduction shall be 
        allowed for any qualified local media advertising expenses 
        otherwise allowable as a deduction for the taxable year which 
        is equal to the amount of the credit determined for such 
        taxable year under subsection (a).
            ``(2) 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.
    ``(g) Termination.--No credit shall be allowed under this section 
for any amount paid or incurred in a taxable year ending after the 
close of 5-year period beginning on the date of the enactment of this 
section.''.
    (b) Credit Allowed as Part of General Business Credit.--Section 
38(b) of the Internal Revenue Code of 1986 is amended by striking 
``plus'' at the end of paragraph (32), by striking the period at the 
end of paragraph (33) and inserting ``, plus'', and by adding at the 
end the following new paragraph:
            ``(34) in the case of an eligible small business, the local 
        media advertising credit determined under section 45U(a).''.
    (c) Clerical Amendment.--The table of sections for subpart D of 
part IV of subchapter A of chapter 1 of such Code is amended by adding 
at the end the following new item:

``Sec. 45U. Advertising in local newspapers and local media.''.
    (d) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred in taxable years beginning after the 
date of the enactment of this Act.
                                 <all>