[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 2069 Introduced in Senate (IS)]

113th CONGRESS
  2d Session
                                S. 2069

  To amend the Internal Revenue Code of 1986 to expand and modify the 
   credit for employee health insurance expenses of small employers.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           February 27, 2014

  Mr. Begich (for himself, Mr. Franken, Mr. Warner, Mrs. Shaheen, Mr. 
  Walsh, Ms. Hirono, and Ms. Landrieu) 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 expand and modify the 
   credit for employee health insurance expenses of small employers.

    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 ``Small Business Tax Credit 
Accessibility Act''.

SEC. 2. SENSE OF THE SENATE.

    It is the sense of the Senate that the Obama administration should 
work to make the small business health care tax credit under section 
45R of the Internal Revenue Code of 1986 more accessible for small 
employers.

SEC. 3. EXPANSION AND MODIFICATION OF CREDIT FOR EMPLOYEE HEALTH 
              INSURANCE EXPENSES OF SMALL EMPLOYERS.

    (a) Expansion of Definition of Eligible Small Employer.--
Subparagraph (A) of section 45R(d)(1) of the Internal Revenue Code of 
1986 is amended by striking ``25'' and inserting ``50''.
    (b) Amendment to Phaseout Determination.--Subsection (c) of section 
45R of the Internal Revenue Code of 1986 is amended to read as follows:
    ``(c) Phaseout of Credit Amount Based on Number of Employees and 
Average Wages.--The amount of the credit determined under subsection 
(b) (without regard to this subsection) shall be adjusted (but not 
below zero) by multiplying such amount by the product of--
            ``(1) the lesser of--
                    ``(A) a fraction the numerator of which is the 
                excess (if any) of 50 over the total number of full-
                time equivalent employees of the employer and the 
                denominator of which is 30, and
                    ``(B) 1, and
            ``(2) the lesser of--
                    ``(A) a fraction the numerator of which is the 
                excess (if any) of--
                            ``(i) the dollar amount in effect under 
                        subsection (d)(3)(B) for the taxable year, 
                        multiplied by 2, over
                            ``(ii) the average annual wages of the 
                        employer for such taxable year, and
                the denominator of which is the dollar amount so in 
                effect under subsection (d)(3)(B), and
                    ``(B) 1.''.
    (c) Partially Phased Out Credit Allowed for Insurance Outside an 
Exchange.--
            (1) In general.--Section 45R of the Internal Revenue Code 
        of 1986 is amended by redesignating subsections (h) and (i) as 
        subsections (i) and (j), respectively, and by inserting after 
        subsection (g) the following new subsection:
    ``(h) Partially Phased Out Credit Allowed for Insurance Outside an 
Exchange for 2014.--
            ``(1) In general.--If an eligible small employer offers to 
        its employees in a manner other than through an Exchange a 
        health plan that meets the requirements of paragraph (2), the 
        following modifications shall apply with respect to a taxable 
        year beginning in 2014:
                    ``(A) Qualified health plan.--This section and 
                section 280C(h) shall be applied for such taxable year 
                by treating such plan as a qualified health plan.
                    ``(B) Reduced credit percentage.--Subsection (b) 
                shall be applied--
                            ``(i) by substituting `25 percent' for `35 
                        percent',
                            ``(ii) by substituting `35 percent' for `50 
                        percent', and
                            ``(iii) without regard to `through an 
                        Exchange' in paragraph (1) thereof.
                    ``(C) Contribution arrangements.--Subsection (d)(4) 
                shall be applied without regard to `through an 
                exchange'.
                    ``(D) Credit period.--
                            ``(i) In general.--The credit under this 
                        section shall be determined without regard to 
                        whether such taxable year is in a credit 
                        period.
                            ``(ii) Year taken into account as portion 
                        of credit period in subsequent years.--For 
                        purposes of applying this section to taxable 
                        years beginning after 2014 in which the 
                        employer offers a qualified health plan 
                        (without regard to subparagraph (A)) to its 
                        employees through an Exchange, subsection 
                        (e)(2) shall be applied by substituting `2-
                        consecutive-taxable' for `3-consecutive-
                        taxable'.
            ``(2) Requirements.--A health plan meets the requirements 
        of this paragraph if such plan--
                    ``(A) provides the essential health benefits 
                package described in section 1302(a) of the Patient 
                Protection and Affordable Care Act, and
                    ``(B) is offered by a health insurance issuer 
                that--
                            ``(i) is licensed and in good standing to 
                        offer health insurance coverage in each State 
                        in which such issuer offers health insurance 
                        coverage, and
                            ``(ii) if such issuer offers health plans 
                        through an Exchange, agrees to charge the same 
                        premium rate for each qualified health plan of 
                        the issuer without regard to whether the plan 
                        is offered through an Exchange or whether the 
                        plan is offered directly from the issuer or 
                        through an agent.''.
            (2) Conforming amendment.--Section 6055(b)(2)(C) of such 
        Code is amended by striking ``Exchange'' and inserting 
        ``Exchange (or a plan with respect to which a credit is allowed 
        under section 45R by reason of subsection (h) thereof)''.
    (d) Extension of Credit Period.--Paragraph (2) of section 45R(e) of 
the Internal Revenue Code of 1986 is amended by striking ``2-
consecutive-taxable'' and inserting ``3-consecutive-taxable''.
    (e) Average Annual Wage Limitation.--Subparagraph (B) of section 
45R(d)(3) of the Internal Revenue Code of 1986 is amended to read as 
follows:
                    ``(B) Dollar amount.--For purposes of paragraph 
                (1)(B) and subsection (c)(2), the dollar amount in 
                effect under this paragraph is the amount equal to 110 
                percent of the poverty line (within the meaning of 
                section 36B(d)(3)) for a family of 4.''.
    (f) Elimination of Uniform Percentage Contribution Requirement.--
Paragraph (4) of section 45R(d) of the Internal Revenue Code of 1986 is 
amended by striking ``a uniform percentage (not less than 50 percent)'' 
and inserting ``at least 50 percent''.
    (g) Elimination of Cap Relating to Average Local Premiums.--
Subsection (b) of section 45R of the Internal Revenue Code of 1986 is 
amended by striking ``the lesser of'' and all that follows and 
inserting ``the aggregate amount of nonelective contributions the 
employer made on behalf of its employees during the taxable year under 
the arrangement described in subsection (d)(4) for premiums for 
qualified health plans offered by the employer to its employees through 
an Exchange.''.
    (h) Credit Availability for Family Members in Certain Cases.--
Clause (iv) of section 45R(e)(1)(A) of the Internal Revenue Code of 
1986 is amended to read as follows:
                            ``(iv) any individual who is a spouse or 
                        dependent (within the meaning of section 152) 
                        of an individual described in clause (i), (ii), 
                        or (iii).''.
    (i) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred in taxable years beginning after 
December 31, 2013.
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