I
113th CONGRESS
2d Session
H. R. 4128
IN THE HOUSE OF REPRESENTATIVES
February 28, 2014
Ms. DelBene (for herself, Ms. Shea-Porter, and Mr. Pallone) 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 expand and modify the credit for employee health insurance expenses of small employers.
Short title
This Act may be cited as the Small Business Tax Credit Accessibility Act
.
Sense of the Congress
It is the sense of the Congress 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.
Expansion and modification of credit for employee health insurance expenses of small employers
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
.
Amendment to phaseout determination
Subsection (c) of section 45R of the Internal Revenue Code of 1986 is amended to read as follows:
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—
the lesser of—
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
1, and
the lesser of—
a fraction the numerator of which is the excess (if any) of—
the dollar amount in effect under subsection (d)(3)(B) for the taxable year, multiplied by 2, over
the average annual wages of the employer for such taxable year, and
1.
.
Partially phased out credit allowed for insurance outside an Exchange
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:
Partially phased out credit allowed for insurance outside an Exchange for 2014
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:
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.
Reduced credit percentage
Subsection (b) shall be applied—
by substituting 25 percent
for 35 percent
,
by substituting 35 percent
for 50 percent
, and
without regard to through an Exchange
in paragraph (1) thereof.
Contribution arrangements
Subsection (d)(4) shall be applied without regard to through an exchange
.
Credit period
In general
The credit under this section shall be determined without regard to whether such taxable year is in a credit period.
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
.
Requirements
A health plan meets the requirements of this paragraph if such plan—
provides the essential health benefits package described in section 1302(a) of the Patient Protection and Affordable Care Act, and
is offered by a health insurance issuer that—
is licensed and in good standing to offer health insurance coverage in each State in which such issuer offers health insurance coverage, and
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.
.
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)
.
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
.
Average annual wage limitation
Subparagraph (B) of section 45R(d)(3) of the Internal Revenue Code of 1986 is amended to read as follows:
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.
.
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
.
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.
.
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:
any individual who is a spouse or dependent (within the meaning of section 152) of an individual described in clause (i), (ii), or (iii).
.
Effective date
The amendments made by this section shall apply to amounts paid or incurred in taxable years beginning after December 31, 2013.