Hospitality and Commerce Job Recovery Act of 2021

II 117TH CONGRESS 1ST SESSION S. 477 To amend the Internal Revenue Code of 1986 to create a refundable tax credit for travel expenditures, and for other purposes. IN THE SENATE OF THE UNITED STATES FEBRUARY 25, 2021 Ms. CORTEZ MASTO (for herself and Mr. CRAMER) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to create a refundable tax credit for travel expenditures, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Hospitality and Com- 4 merce Job Recovery Act of 2021’’. 5 SEC. 2. ESTABLISHMENT OF TAX CREDIT TO SUPPORT THE 6 CONVENTION AND TRADE SHOW INDUSTRY. 7 (a) IN GENERAL.—For purposes of section 38 of the 8 Internal Revenue Code of 1986, the convention and trade 9 show restart credit shall be treated as a credit listed at 10 VerDate Sep 11 2014 04:55 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S477.IS S477 pbinns on DSKJLVW7X2PROD with BILLS 2 •S 477 IS the end of subsection (b) of such section. For purposes 1 of this section, the convention and trade show restart cred- 2 it for any taxable year is an amount equal to the sum 3 of— 4 (1) 50 percent of the qualified participation 5 costs paid or incurred by a taxpayer during such 6 taxable year, and 7 (2) in the case of an eligible provider, 100 per- 8 cent of the qualified restart costs paid or incurred 9 by such provider during such taxable year. 10 (b) QUALIFIED PARTICIPATION COSTS.—For pur- 11 poses of this section, the term ‘‘qualified participation 12 costs’’ means any costs or expenses paid or incurred by 13 the taxpayer after December 31, 2020, for any employee 14 or officer of the taxpayer to attend or participate in a 15 qualified event, including registration fees, lodging, and 16 costs with respect to carrying out an exhibition relating 17 to the taxpayer. Such term shall not include any costs 18 which are not necessary for the attendance or participa- 19 tion of such employee or officer at such event. 20 (c) ELIGIBLE PROVIDER; QUALIFIED RESTART 21 COSTS.—In this section— 22 (1) ELIGIBLE PROVIDER.—The term ‘‘eligible 23 provider’’ means any person which— 24 VerDate Sep 11 2014 04:55 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S477.IS S477 pbinns on DSKJLVW7X2PROD with BILLS 3 •S 477 IS (A) provides facilities at which a qualified 1 event may be held, or 2 (B) sponsors, operates, or is otherwise re- 3 sponsible for the administration of a qualified 4 event. 5 (2) QUALIFIED RESTART COSTS.—The term 6 ‘‘qualified restart costs’’ means any costs paid or in- 7 curred by an eligible provider after December 31, 8 2020, in reopening after such date a facility de- 9 scribed in paragraph (1)(A) which was closed or 10 forced to reduce services due to the virus SARS– 11 CoV–2 or coronavirus disease 2019 (referred to in 12 this section as ‘‘COVID–19’’), including— 13 (A) any renovation, remediation, personal 14 protective equipment, cleaning, or additional 15 labor and rental costs related to preventing in- 16 dividuals present in such facility from con- 17 tracting COVID–19, and 18 (B) any testing of employees of the tax- 19 payer or guests of such facility for symptoms of 20 COVID–19. 21 (d) QUALIFIED EVENT.— 22 (1) IN GENERAL.—In this section, the term 23 ‘‘qualified event’’ means— 24 VerDate Sep 11 2014 04:55 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S477.IS S477 pbinns on DSKJLVW7X2PROD with BILLS 4 •S 477 IS (A) a convention, seminar, or similar meet- 1 ing (as such terms are used in section 274 of 2 the Internal Revenue Code of 1986), 3 (B) a business meeting (as such term is 4 used in such section), or 5 (C) a trade show, 6 which takes place after December 31, 2021. 7 (2) TRADE SHOW.—For purposes of this sub- 8 section, the term ‘‘trade show’’ means any exhibition 9 at which different businesses within a particular in- 10 dustry promote their products and services. 11 (e) DENIAL OF DOUBLE BENEFIT.—No deduction 12 shall be allowed under any provision of chapter 1 of the 13 Internal Revenue Code of 1986 with respect to any 14 amount taken in account in determining the credit allowed 15 to a taxpayer under this section. 16 (f) LOCATION REQUIREMENT.—No credit shall be al- 17 lowed under this section with respect to any qualified 18 event unless such event is held within the United States 19 (including any territory or possession of the United 20 States). 21 (g) PAYROLL CREDIT FOR NONPROFIT EMPLOY- 22 ERS.— 23 (1) IN GENERAL.—In the case of an organiza- 24 tion which is described in section 501(c) of the In- 25 VerDate Sep 11 2014 04:55 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S477.IS S477 pbinns on DSKJLVW7X2PROD with BILLS 5 •S 477 IS ternal Revenue Code of 1986 and exempt from tax 1 under section 501(a) of such Code, the credit deter- 2 mined under this section shall be allowed as a credit 3 against applicable employment taxes paid by such 4 organization for calendar quarters in the taxable 5 year, and not treated as a credit listed at the end 6 of section 38(b) of such Code. 7 (2) LIMITATIONS AND REFUNDABILITY.— 8 (A) CREDIT LIMITED TO EMPLOYMENT 9 TAXES.—The credit allowed by paragraph (1) 10 with respect to calendar quarters in any taxable 11 year shall not exceed the applicable employment 12 taxes (reduced by any credits allowed under 13 subsections (e) and (f) of section 3111 of the 14 Internal Revenue Code of 1986 and sections 15 7001 and 7003 of the Families First 16 Coronavirus Response Act) on the wages paid 17 with respect to the employment of all the em- 18 ployees of the organization for such taxable 19 year. 20 (B) REFUNDABILITY OF EXCESS CRED- 21 IT.— 22 (i) IN GENERAL.—If the amount of 23 the credit under paragraph (1) exceeds the 24 limitation of subparagraph (A) for any cal- 25 VerDate Sep 11 2014 04:55 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S477.IS S477 pbinns on DSKJLVW7X2PROD with BILLS 6 •S 477 IS endar quarter, such excess shall be treated 1 as an overpayment that shall be refunded 2 under sections 6402(a) and 6413(b) of the 3 Internal Revenue Code of 1986. 4 (ii) TREATMENT OF PAYMENTS.—For 5 purposes of section 1324 of title 31, 6 United States Code, any amounts due to 7 the employer under this paragraph shall be 8 treated in the same manner as a refund 9 due from a credit provision referred to in 10 subsection (b)(2) of such section. 11 (3) APPLICABLE EMPLOYMENT TAXES.—For 12 purposes of this subsection, the term ‘‘applicable em- 13 ployment taxes’’ means the following: 14 (A) The taxes imposed under section 15 3111(a) of the Internal Revenue Code of 1986. 16 (B) So much of the taxes imposed under 17 section 3221(a) of such Code as are attrib- 18 utable to the rate in effect under section 19 3111(a) of such Code. 20 (h) REGULATIONS AND GUIDANCE.—The Secretary 21 of the Treasury (or the Secretary’s delegate) may pre- 22 scribe such regulations and other guidance as may be ap- 23 propriate or necessary to carry out the purposes of this 24 section. 25 VerDate Sep 11 2014 04:55 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S477.IS S477 pbinns on DSKJLVW7X2PROD with BILLS 7 •S 477 IS (i) TERMINATION.—This section shall not apply to 1 any costs paid or incurred in taxable years beginning after 2 December 31, 2024. 3 SEC. 3. EXTENSION OF EMPLOYEE RETENTION TAX CRED- 4 IT. 5 (a) IN GENERAL.—Section 2301(m) of the CARES 6 Act (Public Law 116–136) is amended by striking ‘‘July 7 1, 2021’’ and inserting ‘‘January 1, 2022’’. 8 (b) EFFECTIVE DATE.—The amendments made by 9 this section shall apply to calendar quarters beginning 10 after June 30, 2021. 11 SEC. 4. SUSPENSION OF LIMITATION ON ENTERTAINMENT, 12 ETC. EXPENSES RELATED TO TRADE OR BUSI- 13 NESS. 14 (a) IN GENERAL.—Section 274 of the Internal Rev- 15 enue Code of 1986 is amended by adding at the end the 16 following new subsection: 17 ‘‘(q) SPECIAL RULES FOR TAXABLE YEARS 2021 18 THROUGH 2022.—In the case of a taxable year beginning 19 after December 31, 2020, and before January 1, 2023— 20 ‘‘(1) subsection (a)(1)(A) shall not apply to any 21 expense if the taxpayer establishes that the item was 22 directly related to, or, in the case of an item directly 23 preceding or following a substantial and bona fide 24 business discussion (including business meetings at 25 VerDate Sep 11 2014 04:55 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S477.IS S477 pbinns on DSKJLVW7X2PROD with BILLS 8 •S 477 IS a convention or otherwise), that such item was asso- 1 ciated with, the active conduct of the taxpayer’s 2 trade or business, except that the deduction under 3 this section with respect to any such expense shall 4 in no event exceed the portion of such expense with 5 respect to which the taxpayer so establishes, 6 ‘‘(2) in the case of a club, subsection (a)(1)(B) 7 shall not apply if the taxpayer establishes that the 8 facility was used primarily for the furtherance of the 9 taxpayer’s trade or business and that the item was 10 directly related to the active conduct of such trade 11 or business, 12 ‘‘(3) no deduction or credit shall be allowed for 13 any item (not including any qualified nonpersonal 14 use vehicle (as defined in subsection (i)) with respect 15 to an activity which is of a type generally considered 16 to constitute entertainment, amusement, or recre- 17 ation, or with respect to a facility used in connection 18 with such an activity, unless the taxpayer substan- 19 tiates by adequate records or by sufficient evidence 20 corroborating the taxpayer’s own statement— 21 ‘‘(A) the amount of such expense or other 22 item, 23 VerDate Sep 11 2014 04:55 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S477.IS S477 pbinns on DSKJLVW7X2PROD with BILLS 9 •S 477 IS ‘‘(B) the time and place of the entertain- 1 ment, amusement, recreation, or use of the fa- 2 cility or property, 3 ‘‘(C) the business purpose of the expense 4 or other item, and 5 ‘‘(D) the business relationship to the tax- 6 payer of the persons entertained or using the 7 facility or property, 8 except as the Secretary may by regulations provide 9 in the case of an expense which does not exceed an 10 amount prescribed pursuant to such regulations, 11 ‘‘(4) in determining the amount allowable as a 12 deduction under this chapter for any ticket for any 13 activity or facility described in paragraph (3), the 14 amount taken into account shall not exceed the face 15 value of such ticket, except that— 16 ‘‘(A) this paragraph shall not apply to any 17 ticket for any sports event— 18 ‘‘(i) which is organized for the pri- 19 mary purpose of benefiting an organization 20 which is described in section 501(c)(3) and 21 exempt from tax under section 501(a), 22 ‘‘(ii) all of the net proceeds of which 23 are contributed to such organization, and 24 VerDate Sep 11 2014 04:55 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S477.IS S477 pbinns on DSKJLVW7X2PROD with BILLS 10 •S 477 IS ‘‘(iii) which utilizes volunteers for sub- 1 stantially all of the work performed in car- 2 rying out such event, and 3 ‘‘(B) in the case of a skybox or other pri- 4 vate luxury box leased for more than 1 event, 5 the amount allowable as a deduction under this 6 chapter with respect to such events shall not ex- 7 ceed the sum of the face value of non-luxury 8 box seat tickets for the seats in such box cov- 9 ered by the lease (determined by treating 2 or 10 more related leases as 1 lease), 11 ‘‘(5) the amount allowable as a deduction under 12 this chapter for any item with respect to an activity 13 which is of a type generally considered to constitute 14 entertainment, amusement, or recreation, or with re- 15 spect to a facility used in connection with such activ- 16 ity, shall not exceed 50 percent of the amount of 17 such expense or item which would (but for this para- 18 graph) be allowable as a deduction under this chap- 19 ter, and 20 ‘‘(6) paragraph (5) shall not apply to any ex- 21 pense if— 22 ‘‘(A) such expense is described in para- 23 graph (2), (3), (4), (7), (8), or (9) of subsection 24 (e), 25 VerDate Sep 11 2014 04:55 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S477.IS S477 pbinns on DSKJLVW7X2PROD with BILLS 11 •S 477 IS ‘‘(B) such expense is excludable from the 1 gross income of the recipient under section 132 2 by reason of subsection (e) thereof (relating to 3 de minimis fringes), or 4 ‘‘(C) such expense is covered by a package 5 involving a ticket described in paragraph 6 (4)(A).’’. 7 (b) EFFECTIVE DATE.—The amendment made by 8 this section shall apply to taxable years beginning after 9 December 31, 2020. 10 SEC. 5. ESTABLISHMENT OF TAX CREDIT TO SUPPORT THE 11 RESTAURANT INDUSTRY. 12 (a) IN GENERAL.—For purposes of section 38 of the 13 Internal Revenue Code of 1986, in the case of an eligible 14 taxpayer, the restaurant and dining restart credit shall be 15 treated as a credit listed at the end of subsection (b) of 16 such section. For purposes of this section, the restaurant 17 and dining restart credit for any taxable year is an amount 18 equal to the qualified restart costs paid or incurred by the 19 eligible taxpayer during the taxable year. 20 (b) ELIGIBLE TAXPAYER.—For purposes of this sec- 21 tion, the term ‘‘eligible taxpayer’’ means a taxpayer— 22 (1) which owns a trade or business devoted to 23 preparation of food and beverages for on-premises 24 consumption or carry out (not including a trade or 25 VerDate Sep 11 2014 04:55 Mar 19, 2021 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S477.IS S477 pbinns on DSKJLVW7X2PROD with BILLS 12 •S 477 IS business which sells items other than prepared food 1 and beverages), or 2 (2) which owns property on which such a trade 3 or business operates, if more than 50 percent of the 4 square footage of such property is devoted to prepa- 5 ration of, and seating for on-premises consumption 6 of, prepared meals. 7 (c) QUALIFIED RESTART COSTS.—For purposes of 8 this section, the term ‘‘qualified restart costs’’ means any 9 costs paid or incurred by an eligible taxpayer on or after 10 the date of the enactment of this Act in reopening a trade 11 or business or property described in subsection (b), or in- 12 creasing meal and beverage services provided by such 13 trade or business or at such property, which was closed 14 or forced to reduce services due to the virus SARS–CoV– 15 2 or coronavirus disease 2019 (referred to in this section [Text truncated for display. 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