Helping Parents During COVID Act of 2020

II 116TH CONGRESS 2D SESSION S. 4639 To amend the Internal Revenue Code of 1986 to provide a refundable tax credit for expenses relating to school disruption, to provide a monthly payment to families during COVID–19, and for other purposes. IN THE SENATE OF THE UNITED STATES SEPTEMBER 22, 2020 Mr. HAWLEY 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 provide a refundable tax credit for expenses relating to school disruption, to provide a monthly payment to families during COVID–19, 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 ‘‘Helping Parents Dur- 4 ing COVID Act of 2020’’. 5 SEC. 2. CREDIT FOR COSTS OF EDUCATION. 6 (a) IN GENERAL.—Subpart C of part IV of sub- 7 chapter A of chapter 1 of the Internal Revenue Code of 8 VerDate Sep 11 2014 19:33 Oct 05, 2020 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S4639.IS S4639 pamtmann on DSKBC07HB2PROD with BILLS 2 •S 4639 IS 1986 is amended by inserting after section 36 the fol- 1 lowing new section: 2 ‘‘SEC. 36A. CREDIT FOR COSTS OF EDUCATION. 3 ‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in- 4 dividual with respect to whom there is 1 or more eligible 5 children for any taxable year, there shall be allowed as 6 a credit against the tax imposed by this subtitle for such 7 taxable year an amount equal to— 8 ‘‘(1) $800, multiplied by 9 ‘‘(2) the number of eligible children with re- 10 spect to the individual. 11 ‘‘(b) LIMITATION BASED ON ADJUSTED GROSS IN- 12 COME.—The amount of the credit allowed by subsection 13 (a) (determined without regard to this subsection) shall 14 be reduced (but not below zero) by 5 percent of so much 15 of the taxpayer’s adjusted gross income as exceeds— 16 ‘‘(1) $150,000 in the case of a joint return, 17 ‘‘(2) $112,500 in the case of a head of house- 18 hold, and 19 ‘‘(3) $75,000 in the case of a taxpayer not de- 20 scribed in paragraph (1) or (2). 21 ‘‘(c) ELIGIBLE CHILD.—The term ‘eligible child’ with 22 respect to an individual for a taxable year means a quali- 23 fying child (as defined in section 152(c)) of the individual 24 who is an elementary or secondary student (including kin- 25 VerDate Sep 11 2014 19:33 Oct 05, 2020 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S4639.IS S4639 pamtmann on DSKBC07HB2PROD with BILLS 3 •S 4639 IS dergarten), if the school district in which such child re- 1 sides was closed, in part or in full, or utilizing virtual, 2 distance, or other alternative education models or a hybrid 3 of such models and in-person attendance, during any part 4 of the taxable year due to COVID–19. 5 ‘‘(d) TERMINATION.—This section shall not apply to 6 taxable years beginning after December 31, 2021.’’. 7 (b) CLERICAL AMENDMENT.—The table of sections 8 for subpart C of part IV of subchapter A of chapter 1 9 of the Internal Revenue Code of 1986 is amended by in- 10 serting after the item relating to section 36 the following 11 new item: 12 ‘‘Sec. 36A. Credit for costs of education.’’. (c) CONFORMING AMENDMENT.—Section 13 6211(b)(4)(A) of the Internal Revenue Code of 1986 is 14 amended by inserting ‘‘, 36A’’ after ‘‘36’’. 15 (d) EFFECTIVE DATE.—The amendments made by 16 this section shall apply to taxable years beginning after 17 December 31, 2019. 18 SEC. 3. FAMILY EDUCATION ASSISTANCE. 19 (a) ESTABLISHMENT OF FAMILY EDUCATION AS- 20 SISTANCE CREDIT.—Subpart C of part IV of subchapter 21 A of chapter 1 of subtitle A of the Internal Revenue Code 22 of 1986, as amended by section 2, is further amended by 23 inserting after section 36B the following new section: 24 VerDate Sep 11 2014 19:33 Oct 05, 2020 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S4639.IS S4639 pamtmann on DSKBC07HB2PROD with BILLS 4 •S 4639 IS ‘‘SEC. 36C. FAMILY EDUCATION ASSISTANCE. 1 ‘‘(a) IN GENERAL.—As soon as practicable and not 2 later than two weeks after the date of the enactment of 3 this section, the Secretary shall establish a program for 4 making family education assistance credit payments, in- 5 cluding electronic payments, on a monthly basis, without 6 respect to tax liability, for each citizen residing with a de- 7 pendent qualifying child equal to $1,200 for each eligible 8 month. 9 ‘‘(b) LIMITATIONS.— 10 ‘‘(1) LIMITATION BASED ON ADJUSTED GROSS 11 INCOME.—The amount of the credit allowed by sub- 12 section (a) (determined without regard to this sub- 13 section) shall be reduced (but not below zero) by 5 14 percent of so much of the taxpayer’s adjusted gross 15 income as exceeds— 16 ‘‘(A) $150,000 in the case of a joint re- 17 turn, 18 ‘‘(B) $112,500 in the case of a head of 19 household, and 20 ‘‘(C) $75,000 in the case of a taxpayer not 21 described in subparagraph (A) or (B). 22 ‘‘(2) HOUSEHOLD LIMIT.—Family education as- 23 sistance credit payments may only be claimed by one 24 member of a household, and only one credit may be 25 claimed per residence. 26 VerDate Sep 11 2014 19:33 Oct 05, 2020 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S4639.IS S4639 pamtmann on DSKBC07HB2PROD with BILLS 5 •S 4639 IS ‘‘(c) QUALIFYING CHILD.— 1 ‘‘(1) IN GENERAL.—In this section, the term 2 ‘qualifying child’ means a qualifying child of the filer 3 (as defined in section 152(c)) who has not attained 4 18 years of age. 5 ‘‘(2) EXCEPTION FOR CERTAIN NON-CITI- 6 ZENS.—The term ‘qualifying child’ shall not include 7 any individual who would not be a dependent if sub- 8 paragraph (A) of section 152(b)(3) were applied 9 without regard to all that follows ‘resident of the 10 United States’. 11 ‘‘(d) ELIGIBLE MONTH.—For purposes of this sec- 12 tion— 13 ‘‘(1) IN GENERAL.—The term ‘eligible month’ 14 means, with respect to a qualifying child, any month 15 during which— 16 ‘‘(A) such child is an elementary or sec- 17 ondary student (including kindergarten), and 18 ‘‘(B) either— 19 ‘‘(i) the school district in which such 20 child resides is closed, in part or in full, or 21 utilizing virtual, distance, or other alter- 22 native education models or a hybrid of 23 such models and in-person attendance, 24 VerDate Sep 11 2014 19:33 Oct 05, 2020 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S4639.IS S4639 pamtmann on DSKBC07HB2PROD with BILLS 6 •S 4639 IS during any part of the month due to 1 COVID–19, or 2 ‘‘(ii) the parent or guardian of such 3 child elects not to send the child to school 4 due to COVID–19. 5 ‘‘(2) APPLICATION AND TERMINATION.—The 6 term ‘eligible month’ shall include only months be- 7 ginning after July 31, 2020, and before July 1, 8 2021. In the case of eligible months occurring before 9 the establishment of the program described in sub- 10 section (a), the credit amount attributable to such 11 months shall be paid to the recipient in combination 12 with the credit amount for the first eligible month 13 during which such program is operational. 14 ‘‘(e) APPLICATION AND VERIFICATION.— 15 ‘‘(1) APPLICATION.—The Secretary shall estab- 16 lish an expedited process by which citizens may 17 apply for and provide all necessary information to 18 obtain access to installments of the family education 19 assistance credit outside the annual tax return proc- 20 ess utilizing— 21 ‘‘(A) information from the beneficiary’s 22 most recent tax return if the beneficiary has 23 filed previously and such return is for 2018 or 24 2019, and 25 VerDate Sep 11 2014 19:33 Oct 05, 2020 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S4639.IS S4639 pamtmann on DSKBC07HB2PROD with BILLS 7 •S 4639 IS ‘‘(B) any additional or alternative informa- 1 tion submissions deemed necessary by the Sec- 2 retary to facilitate application, verification of 3 eligibility for, and prompt delivery of the family 4 education assistance credit. 5 ‘‘(2) VERIFICATION.—No credit shall be allowed 6 under this section to a taxpayer on the basis of a 7 qualifying child unless the taxpayer has provided the 8 name and taxpayer identification number of such 9 qualifying child in a manner deemed appropriate for 10 the application process by the Secretary. 11 ‘‘(3) TREATMENT OF FAMILY EDUCATION AS- 12 SISTANCE CREDITS FOR INCOME TAX PURPOSES.— 13 ‘‘(A) NONTAXATION OF CREDIT.—Notwith- 14 standing any other provision of law, no amount 15 received as a family education assistance credit 16 shall be treated as income for the purpose of 17 calculating Federal, State, or local tax liability. 18 ‘‘(B) EFFECT ON TAX LIABILITY.—The tax 19 liability of a recipient of the family education 20 assistance credit for a taxable year in which 21 payments of such credit are received shall be 22 determined without respect to such credit.’’. 23 (b) CONFORMING AMENDMENTS.— 24 VerDate Sep 11 2014 04:20 Oct 07, 2020 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S4639.IS S4639 pamtmann on DSKBC07HB2PROD with BILLS 8 •S 4639 IS (1) Section 1324(b)(2) of title 31, United 1 States Code, is amended by inserting ‘‘, 36C’’ after 2 ‘‘36B’’. 3 (2) The table of sections for subpart C of part 4 IV of subchapter A of chapter 1 of the Internal Rev- 5 enue Code of 1986 is amended by inserting before 6 the item relating to section 37 the following new 7 item: 8 ‘‘Sec. 36C. Family education assistance.’’. Æ VerDate Sep 11 2014 19:33 Oct 05, 2020 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6301 E:\BILLS\S4639.IS S4639 pamtmann on DSKBC07HB2PROD with BILLS