TEGL30-11aB.pdf

ETA Advisory File Text

ATTACHMENT B Public Law 112-56 November 21 2011. The Vow to Hire Heroes Act of 2011 Subtitle E Other Matters SEC. 261. RETURNING HEROES AND WOUNDED WARRIORS WORK OPPORTUNITY TAX CREDITS. a IN GENERAL. Paragraph 3 of section 51 b of the Internal Revenue Code of 1986 is amended by striking 12 000 per year in the case of any individual who is a qualified veteran by reason of subsection d 3 A ii and inserting 12 000 per year in the case of any individual who is a qualified veteran by reason of subsection d 3 A ii I 14 000 per year in the case of any individual who is a qualified veteran by reason of subsection d 3 A iv and 24 000 per year in the case of any individual who is a qualified veteran by reason of subsection d 3 A ii II . b RETURNING HEROES TAX CREDITS. Subparagraph A of section 51 d 3 of the Internal Revenue Code of 1986 is amended 1 by striking or at the end of clause i 2 by striking the period at the end of clause ii II and 3 by adding at the end the following new clauses iii having aggregate periods of unemployment during the 1-year period ending on the hiring date which equal or exceed 4 weeks but less than 6 months or iv having aggregate periods of unemployment during the 1-year period ending on the hiring date which equal or exceed 6 months. . c SIMPLIFIED CERTIFICATION. Paragraph 13 of section 51 d of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph D CREDIT FOR UNEMPLOYED VETERANS. i IN GENERAL. Notwithstanding subparagraph A for purposes of paragraph 3 A I a veteran will be treated as certified by the designated local agency as having aggregate periods of unemployment meeting the requirements of clause ii II or iv of such paragraph whichever is applicable if such veteran is certified by such agency as being in receipt of unemployment compensation under State or Federal law for not less than 6 months during the 1-year period ending on the hiring date and II a veteran will be treated as certified by the designated local agency as having aggregate periods of unemployment meeting the requirements of clause iii of such paragraph if such veteran is certified by such agency as being in receipt of unemployment compensation under State or Federal law for not less than 4 weeks but less than 6 months during the 1-year period ending on the hiring date. ii REGULATORY AUTHORITY. The Secretary may provide alternative methods for certification of a veteran as a qualified veteran described in clause ii II iii or iv of paragraph 3 A at the Secretary s discretion. . d EXTENSION OF CREDIT. Subparagraph B of section 51 c 4 of the Internal Revenue Code of 1986 is amended to read as follows B after ATTACHMENT B i December 31 2012 in the case of a qualified veteran and ii December 31 2011 in the case of any other individual. . e CREDIT MADE AVAILABLE TO TAX-EXEMPT ORGANIZATIONS IN CERTAIN CIRCUMSTANCES. 1 IN GENERAL. Subsection c of section 52 of the Internal Revenue Code of 1986 is amended A by inserting 1 IN GENERAL. before No credit and B by adding at the end the following new paragraph 2 CREDIT MADE AVAILABLE TO QUALIFIED TAX-EXEMPT ORGANIZATIONS EMPLOYING QUALIFIED VETERANS. For credit against payroll taxes for employment of qualified veterans by qualified tax-exempt organizations see section 3111 e . . 2 CREDIT ALLOWABLE. Section 3111 of such Code is amended by adding at the end the following new subsection e CREDIT FOR EMPLOYMENT OF QUALIFIED VETERANS. 1 IN GENERAL. If a qualified tax-exempt organization hires a qualified veteran with respect to whom a credit would be allowable under section 38 by reason of section 51 if the organization were not a qualified tax-exempt organization then there shall be allowed as a credit against the tax imposed by subsection a on wages paid with respect to employment of all employees of the organization during the applicable period an amount equal to the credit determined under section 51 after application of the modifications under paragraph 3 with respect to wages paid to such qualified veteran during such period. 2 OVERALL LIMITATION. The aggregate amount allowed as a credit under this subsection for all qualified veterans for any period with respect to which tax is imposed under subsection a shall not exceed the amount of the tax imposed by subsection a on wages paid with respect to employment of all employees of the organization during such period. 3 MODIFICATIONS. For purposes of paragraph 1 section 51 shall be applied A by substituting 26 percent for 40 percent in subsection a thereof B by substituting 16.25 percent for 25 percent in subsection i 3 A thereof and C by only taking into account wages paid to a qualified veteran for services in furtherance of the activities related to the purpose or function constituting the basis of the organization s exemption under section 501. 4 APPLICABLE PERIOD. The term applicable period means with respect to any qualified veteran the 1-year period beginning with the day such qualified veteran begins work for the organization. 5 DEFINITIONS. For purposes of this subsection A the term qualified tax-exempt organization means an employer that is an organization described in section 501 c and exempt from taxation under section 501 a and B the term qualified veteran has meaning given such term by section 51 d 3 . . 3 TRANSFERS TO FEDERAL OLD-AGE AND SURVIVORS INSURANCE TRUST FUND. There are hereby appropriated to the Federal Old-Age and Survivors Trust Fund and the Federal Disability Insurance Trust Fund established under section 201 of the Social Security Act 42 U.S.C. 401 amounts equal to the reduction in revenues to the Treasury by reason of the amendments made by paragraphs 1 and 2 . 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 had such amendments not been enacted. f TREATMENT OF POSSESSIONS. 1 PAYMENTS TO POSSESSIONS. ATTACHMENT B A MIRROR CODE POSSESSIONS. The Secretary of the Treasury shall pay to each possession of the United States with a mirror code tax system amounts equal to the loss to that possession by reason of the amendments made by this section. Such amounts shall be determined by the Secretary of the Treasury based on information provided by the government of the respective possession of the United States. B OTHER POSSESSIONS. The Secretary of the Treasury shall pay to each possession of the United States which does not have a mirror code tax system the amount estimated by the Secretary of the Treasury as being equal to the loss to that possession that would have occurred by reason of the amendments made by this section if a mirror code tax system had been in effect in such possession. The preceding sentence shall not apply with respect to any possession of the United States unless such possession establishes to the satisfaction of the Secretary that the possession has implemented or at the discretion of the Secretary will implement an income tax benefit which is substantially equivalent to the income tax credit in effect after the amendments made by this section. 2 COORDINATION WITH CREDIT ALLOWED AGAINST UNITED STATES INCOME TAXES. The credit allowed against United States income taxes for any taxable year under the amendments made by this section to section 51 of the Internal Revenue Code of 1986 to any person with respect to any qualified veteran shall be reduced by the amount of any credit or other tax benefit described in paragraph 1 B allowed to such person against income taxes imposed by the possession of the United States by reason of this subsection with respect to such qualified veteran for such taxable year. 3 DEFINITIONS AND SPECIAL RULES. A POSSESSION OF THE UNITED STATES. For purposes of this subsection the term possession of the United States includes American Samoa Guam the Commonwealth of the Northern Mariana Islands the Commonwealth of Puerto Rico and the United States Virgin Islands. B MIRROR CODE TAX SYSTEM. For purposes of this subsection the term mirror code tax system means with respect to any possession of the United States the income tax system of such possession if the income tax liability of the residents of such possession under such system is determined by reference to the income tax laws of the United States as if such possession were the United States. C TREATMENT OF PAYMENTS. For purposes of section 1324 b 2 of title 31 United States Code the payments under this subsection shall be treated in the same manner as a refund due from credit provisions described in such section. g EFFECTIVE DATE. The amendments made by this section shall apply to individuals who begin work for the employer after the date of the enactment of this Act.