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To provide a Federal income tax credit for State income taxes paid by individuals temporarily providing certain health or emergency services in the State, and to provide a corresponding reduction in Federal highway funds to the State.

H.R. 312 · 117th Congress · Jan 13, 2021 · Lineage

A BILL

Section 1 Credit for State income taxes paid by individuals temporarily providing certain health or emergency services

(a)
In general— Subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to refundable credits) is amended by inserting after section 36B the following new section:

“36C. Credit for State income taxes paid by individuals temporarily providing certain health or emergency services

“(a) In general—In the case of an eligible individual, there shall be allowed as a credit against the tax imposed by this subtitle for any taxable year an amount equal to the income taxes imposed by a service-recipient State on the wages (as defined in section 3401) paid to such eligible individual for providing specified health or emergency services in such State on a temporary basis during such taxable year.

“(b) Eligible individual—For purposes of this section, the term eligible individual means any individual legally domiciled in a State who provides specified health or emergency services in another State on a temporary basis.

“(c) Specified health or emergency services—For purposes of this section, the term specified health or emergency services means service as a first responder, doctor, nurse, or such other health or emergency service as may be specified by the Secretary for purposes of this section.

“(d) Service-Recipient State—For purposes of this section, the term service-recipient State means the State referred to in subsection (b) in which the eligible individual provides specified health or emergency services on a temporary basis.

“(e) Determination of tax—The amount of the income tax referred to in subsection (a) shall be equal to the excess (if any) of—

“(1) the amount of income taxes imposed by the service-recipient State on the income of such eligible individual, over

“(2) the amount of such income taxes which would be imposed without regard to the wages referred to in subsection (a).

“(f) Termination—Subsection (a) shall not apply with respect to wages paid for services which are provided after the date on which the Secretary certifies that the COVID–19 emergency has concluded.”

(b)
Corresponding reduction in Federal highway funds paid to service-Recipient States— The amount made available by the Federal Government as Federal highway funds to any service-recipient State (as defined in section 36C(d) of the Internal Revenue Code of 1986) shall be reduced by the aggregate amount of credits (as estimated by the Secretary of the Treasury) allowed under section 36C of the Internal Revenue Code of 1986 with respect to income taxes imposed by such State.
(c)
Conforming amendments—
(1)
Section 6211(b)(4)(A) of such Code is amended by inserting “36C,” after “36B,”.
(2)
Section 1324(b)(2) of title 31, United States Code, is amended by inserting “36C,” after “36B,”.
(3)
The table of sections for subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 36B the following new item:
(d)
Effective date— The amendments made by this section shall apply to wages paid for services provided after March 16, 2020.