Credit for employers who employ members of the Ready Reserve or National Guard

(a)

In general

Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to business-related credits) is amended by inserting after section 45M the following new section:

45N.

Credit for employers who employ members of the Ready Reserve or National Guard

(a)

Allowance of credit

For purposes of section 38, the amount of the Ready Reserve-National Guard employment credit determined under this section with respect to any employer for any taxable year is 15 percent of the qualified wages paid or incurred during the calendar year which ends with or within such taxable year. (b)

Qualified wages

(1)

In general

For purposes of this section, the term qualified wages means any wages paid or incurred by an employer for services performed by a Ready Reserve-National Guard employee. (2)

Only first $10,000 of wages per year taken into account

With respect to each employee, the amount of qualified wages which may be taken into account for a calendar year shall not exceed $10,000. (3)

Coordination with other credits

The $10,000 amount in paragraph (2) shall be reduced for any calendar year by the amount of wages paid or incurred during such year which are taken into account in determining the credit under section 45A(a), 51(a), 1396(a), 1400P(b), or 1400R. (c)

Ready reserve-national guard employee

For purposes of this section— (1)

In general

Except as otherwise provided in this subsection, the term Ready Reserve-National Guard employee means, with respect to any period, any employee of an employer if during such period— (A)substantially all of the services performed by such employee for such employer are performed in a trade or business of the employer, and (B)such employee is a member of the Ready Reserve (as defined in section 10142 of title 10, United States Code) or the National Guard (as defined in section 101(c)(1) of such title 10). (2)

Certain individuals not eligible

The term National Guard-Ready Reserve employee shall not include any individual described in a subparagraph of section 1396(d)(2). (d)

Other definitions and special rules

(1)

Wages

For purposes of this section, the term wages has the meaning given to such term by section 1397(a). (2)

Controlled groups, etc

Rules similar to the rules of subsections (b) and (c) of section 1397 shall apply for purposes of this section. (e)

Termination

The term wages shall not include any amount paid or incurred to an individual who begins work for the employer after December 31, 2011.

(b)

Denial of double benefit

Subsection (a) of section 280C of such Code (relating to denial of deduction for certain expenses for which credits are allowable) is amended by inserting 45N, after 45A,. (c)

Credit to be part of general business credit

Subsection (b) of section 38 of such Code is amended by redesignating paragraphs (25) through (30) as paragraphs (26) through (31), respectively, and by inserting after paragraph (24) the following new paragraph:

(25)the Ready Reserve-National Guard employment credit determined under section 45N(a),

(d)

Clerical amendment

The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 45M the following new item:

Sec. 45N. Credit for employers who employ members of the Ready Reserve or National Guard..

(e)

Effective date

The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.