Bill · S. 400· Senate(119-S-400)
Paid Family and Medical Leave Tax Credit Extension and Enhancement Act
- Introduced
- 2/4/2025
- Last activity
- 2/4/2025 — Read twice and referred to the Committee on Finance.
- Sponsored by
- Deb Fischer
- Cosponsors
- - 2 - 0
- Introduced
- In Committee
What this bill would do
This bill, known as the "Paid Family and Medical Leave Tax Credit Extension and Enhancement Act," seeks to amend the Internal Revenue Code of 1986. It aims to enhance the existing paid family and medical leave credit for eligible employers. Employers can choose between a credit based on wages paid to employees on leave or a credit based on insurance policy premiums. The bill also updates rules regarding employer aggregation and how state or local mandated leave is treated. Additionally, it directs the Small Business Administration and the Internal Revenue Service to conduct outreach regarding the credit. These changes are intended to apply to taxable years beginning after the date of enactment.
Yes· 3 of 7
Does this make it easier to run a small business?+6
The bill directs the Small Business Administration to provide targeted communications, education, and technical assistance regarding the leave credit.
Would business owners be better off under this?+5
The bill provides employers with more flexibility to choose how they claim the paid family and medical leave credit.
Does this cut taxes for small businesses?+5
The bill enhances a tax credit for eligible employers to provide paid family and medical leave.
The opposite
No question was scored the opposite.
Who it would affect, and how
Potential Positive Impacts for People
-
Employer Flexibility in Credit Selection: Under Section 2(a)(1), an eligible employer can elect to receive a credit based on either the percentage of wages paid to qualifying employees on leave or the percentage of total insurance policy premiums paid. This provides employers with different ways to claim the credit.
-
Insurance Policy Protection: Section 2(a)(1)(B) and Section 2(a)(1)(A)(ii) ensure that the rate of payment for insurance policies is determined without regard to whether any qualifying employees actually took leave during the taxable year. This provides a more stable credit for employers with insurance policies.
-
Broader Employee Eligibility: Section 2(a)(4)(A) amends the definition of employees to include those customarily employed for not less than 20 hours per week, and it allows for the credit to be applied for periods of at least 6 months.
-
Enhanced Information and Support: Section 2(c) mandates outreach through the Small Business Administration, including district offices, women's business centers, and veteran business outreach centers. This includes providing targeted communications, education, training, and technical assistance to help relevant parties regarding the credit.
-
Taxpayer Assistance: Section 2(c)(2) requires the Secretary of the Treasury to perform targeted outreach to employers and relevant entities, which includes providing information through regular communications to payroll services, tax professionals, and small businesses.
Potential Negative Impacts for People
-
Restrictions on Deductions: According to Section 2(b), no deduction will be allowed for the portion of insurance premiums that is equal to the portion of the paid family and medical leave credit determined under section 45S(a)(1)(B).
-
Treatment of State and Local Leave: Section 2(a)(3)(4)(B) specifies that leave paid by a State or local government or required by State or local law shall not be taken into account in determining the amount of the paid family and medical leave credit under subsection (a).
Groups and Interests Ranking
Every group the model scored this bill for, from -10 to +10. Hover a score for the reason it gave.
- Demographic And Interest Groups
- Good For Business Owners+5Good For Women+4Good For Low Income Households+3Good For Veterans+3
- Economy And Finance
- Improves Small Business Support+6Reduces Small Business Taxes+5
- Social Issues And Justice
- Improves Childcare Affordability+2
- 3/13/2025
- 1 Cosponsor added.
- 3/6/2025
- 1 Cosponsor added.
- 2/4/2025
- Read twice and referred to the Committee on Finance.
- 1 Cosponsor added.
- Introduced in Senate
One bill Congress.gov lists as related to this one — companions in the other chamber, earlier versions, and bills this one absorbed or was folded into.
Angus KingIndependent · Maine
Roger MarshallRepublican · Kansas
Thomas TillisRepublican · North Carolina