Credit for small employer and self-employed pension contributions

(a) In general Subpart C of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 36 the following new section: 36A. Credit for small employer and self-employed pension contributions (a) In general In the case of an eligible taxpayer, there shall be allowed as a credit against the tax imposed by subtitle A an amount equal to the contribution assistance amount with respect to such taxpayer for the taxable year. (b) Contribution assistance amount In the case of an eligible taxpayer, for purposes of this section— (1) In general The contribution assistance amount is an amount equal to the applicable percentage of the qualified pension contributions paid by the eligible taxpayer during the taxable year. (2) Applicable percentage For purposes of paragraph (1), the applicable percentage is 50 percent, reduced (but not below zero) by the number of percentage points which— (A) in the case of an employer, bears the same ratio to 50 as the excess of— (i) the gross receipts of the employer for the taxable year, over (ii) $25,000,000, bears to $75,000,000, and (B) in the case of a self-employed individual, bears the same ratio to 50 as the excess of— (i) the income of the individual for the taxable year, over (ii) $75,000, bears to $50,000. (3) Qualified pension contributions The term qualified pension contributions means— (A) in the case of a covered non-Federal employer or covered self-employed individual, the contributions made by such employer or individual under sections 8423(a) and 8432(c) of title 5, United States Code, (B) in the case of any other employer, the nonelective contributions made by such employer to a covered retirement program (as defined in section 2 of the Pensions for All Act) on behalf of the employees of the employer, and (C) in the case of any other self-employed individual, the contributions made by such individual to a covered retirement program (as so defined) of the individual. (c) Eligible taxpayers, etc For purposes of this section— (1) In general The term eligible taxpayer means— (A) any covered non-Federal employer making an election under both sections 8423(a)(4)(E)(i) and 8432(c)(4)(E)(i) of title 5, United States Code not to receive a reduction in employer contributions, (B) any employer which is not a covered non-Federal employer, (C) any covered self-employed individual making an election under both sections 8423(a)(4)(E)(ii) and 8432(c)(4)(E)(ii) of title 5, United States Code not to receive a reduction in contributions, and (D) any self-employed individual who is not a covered self-employed individual. (2) Covered non-Federal employer; covered self-employed individual The terms covered non-Federal employer and covered self-employed individual have the respective meanings given such terms by section 8401 of title 5, United States Code. (d) Coordination with other credits (1) Business credit treated as part of general business credit In the case of an employer, the credit which (but for this paragraph) would otherwise be allowed under subsection (a) for any taxable year shall be treated as a credit listed in section 38(b) for such taxable year (and not allowed under subsection (a)). (2) Denial of double benefit No deduction or credit shall be allowed under any other section of this title with respect to contributions to a plan (including the Federal Employees Retirement System under chapter 84 of title 5, United States Code) if credit is allowable with respect to such contributions under subsection (a) (determined without regard to this subsection).. (b) Employer credit To be part of general business credit Subsection (b) of section 38 of the Internal Revenue Code of 1986 is amended by striking plus at the end of paragraph (40), by striking the period at the end of paragraph (41) and inserting, plus, and by adding at the end the following new paragraph: (42) in the case of an eligible taxpayer (as defined in section 36A(c)), the portion of the credit for small employer and self-employed pension contributions to which section 36A(d)(1) applies.. (c) Conforming amendment Section 6211(b)(4)(A) of the Internal Revenue Code of 1986 is amended by inserting, 36A after 36. (d) Clerical amendment 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 36 the following new item: Sec. 36A. Credit for small employer and self-employed pension contributions.. (e) Effective date The amendments made by this section shall apply to contributions made after the date of the enactment of this Act.