Small Business Tax Credit Accessibility Act

Bill: 114-s-379
Sponsor: full_name: Sen. Coons, Christopher A. [D-DE]
Introduced: 2015-02-05
Policy area: Taxation
Subjects: Employee benefits and pensions

Health care costs and insurance

Income tax credits

Small business

Wages and earnings
Latest action: action_date: 2016-05-18
text: Committee on Small Business and Entrepreneurship. Hearings held.

Summaries:
action_date: 2015-02-05
action_desc: Introduced in Senate
text: <p><strong>Small Business Tax Credit Accessibility Act </strong></p> <p>Amends the Internal Revenue Code, with respect to the small employer health care insurance tax credit, to: (1) revise the definition of "eligible small employer" to mean an employer with not more than 50 (currently, 25) full-time employees; (2) modify the phaseout formula for such credit to base such phaseout on number of employees and average annual wages; (3) extend from two to three consecutive taxable years the period during which an employer may claim such credit; and (4)&nbsp;eliminate the requirement that employers contribute the same percentage of cost of each employee's health insurance and the cap limiting eligible employer contributions to average premiums paid to a state health insurance exchange.</p>

tv_txt: II 114th CONGRESS 1st Session S. 379 IN THE SENATE OF THE UNITED STATES February 5, 2015 Mr. Coons (for himself, Mr. Merkley , Mr. King , Mr. Manchin , Ms. Heitkamp , Mrs. Shaheen , Mr. Kaine , Mr. Franken , and Ms. Hirono ) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to expand and modify the credit for employee health insurance expenses of small employers.

1. Short title This Act may be cited as the Small Business Tax Credit Accessibility Act . 2. Expansion and modification of credit for employee health insurance expenses of small employers (a) Expansion of definition of eligible small employer Subparagraph (A) of section 45R(d)(1) of the Internal Revenue Code of 1986 is amended by striking 25 and inserting 50 . (b) Amendment to phaseout determination Subsection (c) of section 45R of the Internal Revenue Code of 1986 is amended to read as follows: (c) Phaseout of credit amount based on number of employees and average wages The amount of the credit determined under subsection (b) (without regard to this subsection) shall be adjusted (but not below zero) by multiplying such amount by the product of— (1) the lesser of— (A) a fraction the numerator of which is the excess (if any) of 50 over the total number of full-time equivalent employees of the employer and the denominator of which is 30, and (B) 1, and (2) the lesser of— (A) a fraction— (i) the numerator of which is the excess (if any) of— (I) the dollar amount in effect under subsection (d)(3)(B) for the taxable year, multiplied by 3, over (II) the average annual wages of the employer for such taxable year, and (ii) the denominator of which is the dollar amount so in effect under subsection (d)(3)(B), multiplied by 2, and (B) 1. . (c) Extension of credit period Paragraph (2) of section 45R(e) of the Internal Revenue Code of 1986 is amended by striking 2-consecutive-taxable year period and all that follows and inserting “3-consecutive-taxable year period beginning with the 1st taxable year beginning after 2014 in which— (A) the employer (or any predecessor) offers 1 or more qualified health plans to its employees through an Exchange, and (B) the employer (or any predecessor) claims the credit under this section. . (d) Average annual wage limitation Subparagraph (B) of section 45R(d)(3) of the Internal Revenue Code of 1986 is amended to read as follows: (B) Dollar amount For purposes of paragraph (1)(B) and subsection (c)(2), the dollar amount in effect under this paragraph is the amount equal to 110 percent of the poverty line (within the meaning of section 36B(d)(3)) for a family of 4. . (e) Elimination of uniform percentage contribution requirement Paragraph (4) of section 45R(d) of the Internal Revenue Code of 1986 is amended by striking a uniform percentage (not less than 50 percent) and inserting at least 50 percent . (f) Elimination of cap relating to average local premiums Subsection (b) of section 45R of the Internal Revenue Code of 1986 is amended by striking the lesser of and all that follows and inserting the aggregate amount of nonelective contributions the employer made on behalf of its employees during the taxable year under the arrangement described in subsection (d)(4) for premiums for qualified health plans offered by the employer to its employees through an Exchange. . (g) Conforming amendment relating to annual wage limitation Subparagraph (B) of section 45R(d)(1) of the Internal Revenue Code of 1986 is amended by striking twice and inserting three times . (h) Effective date The amendments made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2014.