[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 1856 Introduced in Senate (IS)]
107th CONGRESS
1st Session
S. 1856
To amend the Internal Revenue Code of 1986 to promote employer and
employee participation in telework arrangements, and for other
purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
December 19 (legislative day, December 18), 2001
Mr. Kerry (for himself, Mr. Burns, Mr. Corzine, and Mr. Baucus)
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 promote employer and
employee participation in telework arrangements, 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 ``Teleworking Advancement Act''.
SEC. 2. CREDIT FOR TELEWORKING.
(a) In General.--Subpart B of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 (relating to foreign tax credit,
etc.) is amended by inserting after section 30A the following new
section:
``SEC. 30B. TELEWORK CREDIT.
``(a) General Rule.--There shall be allowed as a credit against the
tax imposed by this chapter for any taxable year an amount equal to the
sum of--
``(1) the employer telework tax credit, plus
``(2) the telework equipment tax credit.
``(b) Employer Telework Tax Credit; Telework Equipment Tax
Credit.--For purposes of this section--
``(1) Employer telework tax credit.--Except as provided for
in subsection (c)(1), the employer telework tax credit for any
taxable year is equal to $500 for each employee who
participates in an employer sponsored telework arrangement
during the taxable year.
``(2) Telework equipment tax credit.--Except as provided
for in subsection (c)(2), the telework equipment tax credit for
any taxable year is equal to 10 percent of qualified telework
expenses paid or incurred during the taxable year by either the
employer on behalf of the employee, or directly by the
employee, pursuant to an employer sponsored telework
arrangement.
``(c) Special Rule for Disabled Employees and Employees of Small
Businesses.--For purposes of this section:
``(1) For each employee who is covered under the Americans
with Disabilities Act of 1990 (42 U.S.C. 1201), or for each
employee of a small business, the employer telework tax credit
for any taxable year is equal to $1,000 for each employee who
participates in an employer sponsored telework arrangement
during the taxable year.
``(2) For each employee who is covered under the Americans
with Disabilities Act of 1990 (42 U.S.C. 1201), or for each
employee of a small business, the telework equipment tax credit
for any taxable year is equal to 20 percent of qualified
telework expenses paid or incurred during the taxable year by
either the employer on behalf of the employee, or directly by
the employee, pursuant to an employer sponsored telework
arrangement.
``(d) Credit Adjustments and Limitations.--
``(1) Credit adjustments.--In computing the credit allowed
under subsection (b)(1) or (c)(1) for any taxable year, the
following adjustments shall apply:
``(A) In the case of an employee who participates
in an employer sponsored telework arrangement for less
than the full taxable year, the credit amount
identified in subsection (b)(1) or (c)(1), whichever is
applicable, shall be multiplied by a fraction, the
numerator of which is the total number of months in the
taxable year that the employee participates in an
employer sponsored telework arrangement and the
denominator of which is 12. For purposes of the
preceding sentence, an employee is considered to be
participating in an employer sponsored telework
arrangement for a month if the employee teleworks for
at least one full day of such month.
``(B) In the case of an employee who participates
in an employer sponsored telework arrangement but does
not telework every day of the taxable year that the
employee is required by his or her employer to work,
the credit amount identified in subsection (b)(1) or
(c)(1), whichever is applicable, shall be multiplied by
a fraction, the numerator of which is the total number
of full days in the taxable year that the employee
teleworks and the denominator of which is the total
number of days in the taxable year that the employee is
required by his or her employer to work.
``(2) Telework equipment credit limitations.--
``(A) In computing the credit allowed under
subsection (b)(2) for any taxable year, the following
limitations shall apply:
``(i) The maximum credit claimed by any
employer with respect to qualified telework
expenses paid or incurred on behalf of an
employee shall not exceed $500 for each
employee who participates in an employer
sponsored telework arrangement.
``(ii) The maximum credit claimed by any
employee with respect to qualified telework
expenses paid or incurred directly by the
employee pursuant to an employer sponsored
telework arrangement shall not exceed $500.
``(B) In computing the credit allowed under
subsection (c)(2) for any taxable year with respect to
employees who are covered under the Americans with
Disabilities Act of 1990 (42 U.S.C. 1201), or for each
employee of a small business, the following
limitations shall apply:
``(i) The maximum credit claimed by any
employer with respect to qualified telework
expenses paid or incurred on behalf of an
employee shall not exceed $1,000 for each
employee who participates in an employer
sponsored telework arrangement.
``(ii) The maximum credit claimed by any
employee with respect to qualified telework
expenses paid or incurred directly by the
employee pursuant to an employer sponsored
telework arrangement shall not exceed $1,000.
``(e) Definitions.--For purposes of this section--
``(1) Employer sponsored telework arrangement.--The term
`employer sponsored telework arrangement' means an arrangement
established by an employer that enables employees of the
employer to telework for a minimum of 25 full days per taxable
year. Such an arrangement shall be supported by a written
agreement between the employer and each teleworking employee
that describes the terms of the employer sponsored telework
arrangement.
``(2) Qualified telework expenses.--
``(A) In general.--The term `qualified telework
expenses' shall include expenses paid or incurred for
computers, computer-related hardware and software,
modems, data processing equipment, telecommunications
equipment, and access to Internet or broadband
technologies, including applicable taxes and other
expenses for the delivery, installation, or maintenance
of such equipment.
``(B) Only certain expenses taken into account.--
Expenses shall be taken into account under subparagraph
(A) only to the extent they are authorized by the
employer pursuant to an employer sponsored telework
arrangement and are necessary to enable the employee to
telework.
``(3) Small business.--The term `small business' means a
business with an average of 100 or fewer employees during the
taxable year.
``(4) Telework.--An employee shall be treated as engaged in
telework if--
``(A) the employee's normal and regular work
functions are performed at a fixed location provided by
the employer,
``(B)(i) the employee, under an employer sponsored
telework arrangement, performs such functions at the
employee's residence or at a location specifically
designed to allow employees to perform such functions
closer to their residence, and
``(ii) the performance of such functions at
such residence or location eliminates or
substantially reduces the physical commute of
the employee to the fixed location described in
subparagraph (A), and
``(C) the employee transmits by electronic or other
communications medium the employee's work product from
such residence or location to the fixed location where
such functions would otherwise have been performed.
``(f) Special Rules.--
``(1) Limitation based on amount of tax.--
``(A) Liability for tax.--The credit allowable
under subsection (a) for any taxable year shall not
exceed the excess (if any) of--
``(i) the regular tax for the taxable year,
reduced by the sum of the credits allowable
under subpart A and the preceding sections of
this subpart, over
``(ii) the tentative minimum tax for the
taxable year.
``(B) Carryforward of unused credit.--If the amount
of the credit allowable under subsection (a) for any
taxable year exceeds the limitation under paragraph
(1)(A) for the taxable year, the excess shall be
carried to the succeeding taxable year and added to the
amount allowable as a credit under subsection (a) for
such succeeding taxable year.
``(2) Basis reduction.--The basis of any property for which
a credit is allowable under subsection (a) shall be reduced by
the amount of such credit (determined without regard to
paragraph (1)).
``(3) Recapture.--The Secretary shall, by regulations,
provide for recapturing the benefit of any credit allowable
under subsection (a) with respect to any property which ceases
to be property eligible for such credit.
``(4) Property used outside united states, etc., not
qualified.--No credit shall be allowed under subsection (a)
with respect to any property referred to in section 50(b) or
with respect to the portion of the cost of any property taken
into account under section 179.
``(5) Election not to take credits.--No credits shall be
allowed under subsection (a) for any expense if the taxpayer
elects to not have this section apply with respect to such
expense.
``(6) Denial of double benefit.--No deduction or credit
(other than under this section) shall be allowed under this
chapter with respect to any expense which is taken into account
in determining the credit under this section.
``(7) Documentation.--Employers and employees are
responsible for maintaining adequate documentation to support
any credits claimed under this section.''
(b) Conforming Amendment.--Subsection (a) of section 1016 of the
Internal Revenue Code of 1986 (relating to general rule for adjustments
to basis) is amended by striking ``and'' at the end of paragraph (27),
by striking the period at the end of paragraph (28) and inserting ``,
and'', and by adding at the end the following:
``(29) in the case of property with respect to which a
credit was allowed under section 30B, to the extent provided in
section 30B(f)(2).''
(c) Clerical Amendment.--The table of sections for subpart B 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 30A the
following new item:
``Sec. 30B. Telework credit.''
(d) Regulatory Matters.--
(1) Prohibition.--No Federal or State agency or
instrumentality shall adopt regulations or ratemaking
procedures that would have the effect of confiscating any
credit or portion thereof allowed under sections 30B of the
Internal Revenue Code of 1986 (as added by this Act) or
otherwise subverting the purpose of this Act.
(2) Treasury regulatory authority.--It is the intent of
Congress in providing the telework tax credit under section 30B
of the Internal Revenue Code of 1986 (as added by this Act) to
promote broad participation in employer sponsored telework
arrangements by providing incentives to both employers and
employees. Accordingly, the Secretary of the Treasury shall
prescribe such regulations as may be necessary or appropriate
to carry out the purposes of section 30B of such Code,
including regulations describing the information, records, and
data that employers and employees are required to provide the
Secretary to substantiate compliance with the requirements of
this section and section 30B of such Code. Until the Secretary
prescribes such regulations, employers and employees may base
such determinations on any reasonable method that is consistent
with the purposes of section 30B of such Code.
(e) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2001.
SEC. 3. SMALL BUSINESS TELECOMMUTING PILOT PROGRAM.
(a) In General.--In accordance with this section, the Administrator
shall conduct, in not more than 5 of the Small Business
Administration's regions, a pilot program to raise awareness about
telecommuting among small business employers and to encourage such
employers to offer telecommuting options to employees.
(b) Special Outreach to Individuals With Disabilities.--In carrying
out subsection (a), the Administrator shall make special efforts to do
outreach to--
(1) businesses owned by or employing individuals with
disabilities, and disabled American veterans in particular;
(2) Federal, State, and local agencies having knowledge and
expertise in assisting individuals with disabilities or
disabled American veterans; and
(3) any group or organization, the primary purpose of which
is to aid individuals with disabilities or disabled American
veterans.
(c) Permissible Activities.--In carrying out the pilot program, the
Administrator may only--
(1) produce educational materials and conduct presentations
designed to raise awareness in the small business community of
the benefits and the ease of telecommuting;
(2) conduct outreach--
(A) to small business concerns that are considering
offering telecommuting options; and
(B) as provided in subsection (b); and
(3) acquire telecommuting technologies and equipment to be
used for demonstration purposes.
(d) Selection of Regions.--In determining which regions will
participate in the pilot program, the Administrator shall give priority
consideration to regions in which Federal agencies and private-sector
employers have demonstrated a strong regional commitment to
telecommuting.
(e) Report to Congress.--Not later than 2 years after the first
date on which funds are appropriated to carry out this section, the
Administrator shall transmit to the Committee on Small Business of the
House of Representatives and the Committee on Small Business of the
Senate a report containing the results of an evaluation of the pilot
program and any recommendations as to whether the pilot program, with
or without modification, should be extended to include the
participation of all Small Business Administration regions.
(f) Definitions.--In this section--
(1) the term ``Administrator'' means the Administrator of
the Small Business Administration;
(2) the term ``disability'' has the same meaning as in
section 3 of the Americans with Disabilities Act of 1990 (42
U.S.C. 12102);
(3) the term ``pilot program'' means the program
established under this section; and
(4) the term ``telecommuting'' means the use of
telecommunications to perform work functions under
circumstances which reduce or eliminate the need to commute.
(g) Termination.--The pilot program shall terminate 2 years after
the first date on which funds are appropriated to carry out this
section.
(h) Authorization of Appropriations.--There is authorized to be
appropriated to the Small Business Administration $5,000,000 to carry
out this section.
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