Epidemic tax credit

(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:

45U.

Epidemic credit

(a)

General rule

For purposes of section 38, the epidemic credit for any taxable year is an amount equal to 90 percent of the amount of qualifying wages paid by a qualified employer to qualifying employees.(b)

Definitions

For purposes of this section—(1)

Qualifying wages

The term qualifying wages means wages paid to a qualifying employee who—(A)is on leave,(B)does not come to the workplace, and(C)performs no substantial work for the employer.(2)

Qualified Employer

The term qualified employer means any employer that is not a government employer. (3)

Government employer

The term government employer means—(A)the Federal Government,(B)any State government,(C)any government of a possession or territory of the United States,(D)the Government of the District of Columbia,(E)the government of any county, city, town, township, parish, village, or other general purpose political subdivision of a State,(F)any Indian Tribal Government (as defined in section 7701(a)(40)),(G)any foreign government, or(H)any international organization (as defined in section 7701(a)(18)).(4)

Tax-Exempt Employer

The term tax-exempt employer means—(A)any employer that is exempt from taxation pursuant to subchapter F of chapter 1 of subtitle A, or(B)any other employer designated by the Secretary as a tax-exempt employer for purposes of this section.(5)

Qualifying Employee

The term qualifying employee means a person who—(A)has been an employee of the qualified employer for at least one pay period preceding the designation of the epidemic area where the person’s workplace is located,(B)normally performs substantially all of the person’s work in a designated epidemic area,(C)is not a part-time employee (as defined in section 4980E(d)(4)(B)), and(D)cannot, given the nature of the person’s employment, reasonably be expected to telecommute.(6)

Epidemic area

The term epidemic area means any county designated as an epidemic area by the Director of the Centers for Disease Control and Prevention.(7)

County

For purposes of paragraph (6), the term county means— (A)any county or parish that is a subdivision of a State,(B)a city or other political subdivision that is functionally equivalent to a county or parish,(C)a possession or territory of the United States, or(D)the District of Columbia.(c)

Limitation

(1)

Maximum weekly wage creditable

The amount of qualifying wages shall not exceed $2,000 with respect to any calendar week for any qualifying employee.(2)

Maximum leave period creditable

The amount of leave that may be taken into account with respect to any qualifying employee under subsection (a) for any taxable year shall not exceed 8 calendar weeks.(d)

Epidemic area designation

(1)

Designation

The Director of the Centers for Disease Control and Prevention may designate as an epidemic area any county within the United States provided that—(A)a public health emergency has been declared pursuant to section 247d of title 42, United States Code, (B)the Director finds that a substantial number of cases of a communicable disease have occurred in the United States and that such communicable disease is reasonably expected to be life-threatening to at least one-half of 1 percent of those that contract the disease,(C)the Director finds that risk of the introduction, transmission, or spread of such communicable disease will be substantially reduced by encouraging people not to come to work within the county, and(D)the Director finds that a person or persons have been quarantined or otherwise isolated either within the county to be designated as an epidemic area, or within a county geographically adjacent to the county to be designated as an epidemic area, for the purpose of preventing the introduction, transmission, or spread of such communicable disease.(2)

Epidemic Area List

So long as there are any designated epidemic areas, the Director shall maintain a list of designated epidemic areas which shall provide the name of each designated epidemic area, the date on which the designation was made for each county and, if removed from the list, the date a county was removed from the list of designated epidemic areas. The epidemic area list shall be published at least weekly in the Federal Register. The epidemic area list shall be maintained and updated daily on the website of the Centers for Disease Control and Prevention.(3)

Limitation

A county shall maintain its status as a declared epidemic area until the earlier of—(A)a finding by the Director that the county is no longer an epidemic area; or(B)90 days after the declaration of the county as an epidemic area.(e)

Special Rule for Tax-Exempt Employers

(1)

Tax-exempt employers eligible

Tax-exempt employers are eligible to receive the credit provided by this section notwithstanding their tax-exemption.(2)

Application required

Application for payment of the epidemic credit to a tax-exempt employer shall be in such form and contain such information as the Secretary shall prescribe. Any claim for credit under this subsection by a tax-exempt employer shall be filed within 6 months after the date that the last qualifying wages were paid.(3)

Payment

On proof satisfactory to the Secretary that the epidemic credit is due to a tax-exempt employer, the Secretary shall make payment to the tax-exempt employer.(f)

Effective date

The amendment made by this section shall apply to wages paid on or after the date of the enactment of this Act. This section shall not apply to wages paid after December 31, 2020.

(b)

General Business Credit

Subsection (b) of section 38 is amended by striking the period at the end thereof, by striking the word plus in paragraph 32 and by adding at the end thereof:

plus(34)the epidemic credit determined under section 45U.