I 111th CONGRESS 2d Session H. R. 4680 IN THE HOUSE OF REPRESENTATIVES February 24, 2010 Mr. Ellsworth introduced the following bill; which was referred to the Committee on Ways and Means A BILL To reduce the employer portion of payroll taxes in the case of employers who expand payroll in 2010 and 2011.

1.

Short title

This Act may be cited as the Jobs Momentum Act of 2010.

2.

Reduction in employer portion of payroll tax for certain employers increasing payroll

(a)

In general

In the case of any calendar quarter beginning in 2010 or 2011, the aggregate amount of employer payroll tax deposits of an employer shall be reduced (but not below zero) by an amount equal to the applicable percentage of the payroll increase of such employer for such calendar quarter. (b)

Definitions and special rules

For purposes of this section— (1)

Employer payroll tax deposits

The term employer payroll tax deposits means deposits an employer is required to make under section 6302 of the Internal Revenue Code of 1986 of taxes imposed on such employer under section 3111 of such Code with respect to individuals in his employ. (2)

Applicable percentage

The applicable percentage shall be— (A)in the case of any calendar quarter beginning in 2010, 10 percent, and (B)in the case of any calendar quarter beginning in 2011, 5 percent. (3)

Payroll increase

(A)

In general

The term payroll increase means, with respect to an employer for a calendar quarter, the excess (if any) of— (i)the aggregate amount of qualified wages (as defined in section 3121(a) of such Code) paid by such employer to all employees for such calendar quarter, over (ii)aggregate amount of inflation adjusted qualified wages paid by such employer to all employees for the same calendar quarter in the preceding calendar year. (B)

Qualified wages

The term qualified wages means, with respect to an employee, so much of such employee’s wages (as defined in section 3121(a)) of such Code) as does not exceed $32,000. (C)

Inflation adjusted qualified wages

The term inflation adjusted qualified wages means an amount equal to— (i)qualified wages with respect to an employee, multiplied by (ii)the cost-of-living adjustment determined under section 1(f)(3) for the calendar year for which the reduction in deposits under this section is being determined occurs, determined by substituting ‘calendar year 2009’ for ‘calendar year 1992’ in subparagraph (B) thereof. (4)

Denial of double benefit

The amount of any deduction allowable to the employer under chapter 1 of such Code for taxes paid under section 3111 of such Code with respect to employment during any calendar quarter shall be reduced by the amount by which the employer payroll tax deposits of such employer are reduced under subsection (a) for such quarter. (5)

Wages must be for trade or business

A rule similar to the rule of section 51(f) of such Code shall apply. (6)

Adjustments for certain acquisitions, etc

Under regulations prescribed by the Secretary— (A)

Acquisitions

If, after December 31, 2009, an employer acquires the major portion of a trade or business of another person (hereafter in this paragraph referred to as the predecessor) or the major portion of a separate unit of a trade or business of a predecessor, then, for purposes of applying this section for any calendar quarter ending after such acquisition, the amount of wages or compensation deemed paid by the employer during periods before such acquisition shall be increased by so much of such wages or compensation paid by the predecessor with respect to the acquired trade or business as is attributable to the portion of such trade or business acquired by the employer. (B)

Dispositions

If, after December 31, 2009— (i)an employer disposes of the major portion of any trade or business of the employer or the major portion of a separate unit of a trade or business of the employer in a transaction to which paragraph (1) applies, and (ii)the employer furnishes the acquiring person such information as is necessary for the application of subparagraph (A), then, for purposes of applying this section for any calendar quarter ending after such disposition, the amount of wages or compensation deemed paid by the employer during periods before such disposition shall be reduced by so much of such wages as is attributable to such trade or business or separate unit.(7)

Employers not on quarterly system

The Secretary of the Treasury shall prescribe rules for the application of this section in the case of an eligible employer whose required income tax deposits are not made on a quarterly basis.