I
110th CONGRESS
1st Session
H. R. 2330
IN THE HOUSE OF REPRESENTATIVES
May 15, 2007
Mr. McCotter (for himself, Mr. Carter, Mr. Pearce, Mr. Renzi, Mr. Porter, Mrs. Miller of Michigan, Mr. Shuster, Mr. Jones of North Carolina, Mr. Manzullo, Mr. Paul, and Mrs. Myrick) introduced the following bill; which was referred to the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to allow employers a credit against income tax for hiring veterans.
Short title
This Act may be cited as the Veterans’ Employment Transition Support Act of 2007
or the VETS Act of 2007
.
Credit for employers hiring veterans
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 adding at the end the following new section:
Credit for employers hiring veterans
General Rule
For purposes of section 38, the military service personnel employment credit for the taxable year shall be equal to—
in the case of a qualified veteran, 40 percent of the qualified first-year wages with respect to such veteran for such year, and
in the case of a qualified disabled veteran, the applicable percentage of the qualified first-year wages with respect to such veteran for such year.
Veteran taken into account only once
No credit shall be determined under subsection (a) with respect to any veteran unless such veteran has elected (in such form and manner as the Secretary may require) to have his qualified first-year wages taken into account with respect to the employer paying such wages. A veteran may make only one election under this subsection. The Secretary shall require such reporting as the Secretary determines is necessary to carry out the purposes of this subsection.
Qualified wages
For purposes of this section—
In general
The term qualified wages
means, with respect to any individual, the wages paid or incurred by the employer during the taxable year to such individual.
Qualified first-year wages
The term qualified first-year wages
means, with respect to any individual, qualified wages attributable to service rendered during the 1-year period beginning with the day the individual begins work for the employer.
Wages
The term wages
has the meaning given such term by section 51(c), without regard to paragraph (4) thereof.
Qualified veteran; hiring date
For purposes of this section—
Qualified veteran
The term qualified veteran
means any individual who is certified by the designated local agency (as defined in section 51(d)(11)) as being a veteran (as defined in section 51(d)(3)(B)).
Hiring date
The term hiring date
has the meaning given such term by section 51(d).
Qualified disabled veteran; applicable percentage
In general
The term qualified disabled veteran
means any qualified veteran who is certified by the designated local agency (as defined in section 51(d)(11)) as having a disability that has been determined under the laws administered by the Secretary of Veterans Affairs to be service-connected and that is rated by such Secretary (as of the date of the certification) as 10 percent or more disabling.
Applicable percentage
The term applicable percentage
means the percentage determined in accordance with the following table:
| Percentage of disability: | Applicable percentage: |
| At least 10 but not over 20 | 41 |
| At least 20 but not over 30 | 42 |
| At least 30 but not over 40 | 43 |
| At least 40 but not over 50 | 44 |
| At least 50 but not over 60 | 45 |
| At least 60 but not over 70 | 46 |
| At least 70 but not over 80 | 47 |
| At least 80 but not over 90 | 48 |
| At least 90 but not over 100 | 49 |
| 100 percent | 50 |
Certain rules To apply
Rules similar to the rules of section 52, and subsections (d)(11), (f), (g), (i) (as in effect on the day before the date of the enactment of the Taxpayer Relief Act of 1997), (j), and (k) of section 51, shall apply for purposes of this section.
Coordination with work opportunity credit
The credit allowed under this section with respect to any qualified first-year wages shall be in addition to any credit allowed under section 51 with respect to such wages.
.
Credit To be part of general business credit
Subsection (b) of section 38 of such Code is amended by striking plus
at the end of paragraph (30), by striking the period at the end of paragraph (31) and inserting , plus
, and by adding at the end the following new paragraph:
the military service personnel employment credit determined under section 45O(a).
.
Technical amendments
Clause (iii) of section 41(b)(2)(D) of such Code is amended to read as follows:
Exclusion for wages to which employment credits apply
The term wages shall not include any amount taken into account in determining the credit under section 45O(a) or 51(a).
.
Subparagraph (B) of section 45A(b)(1) of such Code is amended to read as follows:
Coordination with other employment credits
The term qualified wages shall not include wages attributable to service rendered during the 1-year period beginning with the day the individual begins work for the employer if any portion of such wages is taken into account in determining the credit under section 45O or 51.
.
Subsection (a) of section 280C of such Code is amended by inserting 45O(a),
after 45A(a),
.
Paragraph (3) of section 1396(c) of such Code is amended to read as follows:
Coordination with other employment credits
In general
The term qualified wages shall not include wages taken into account in determining the credit under section 45O or 51.
Coordination with paragraph (2)
The $15,000 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 credits under sections 45O and 51.
.
Clerical amendment
The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item:
Sec. 45O. Credit for employers hiring veterans.
.
Effective date
The amendments made by this section shall apply to individuals who begin work for the employer after the date of the enactment of this Act.