S. 4639 - Helping Parents During COVID Act of 2020

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 Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the "Helping Parents During COVID Act of 2020".

SEC. 2. CREDIT FOR COSTS OF EDUCATION.

(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:

"SEC. 36A. CREDIT FOR COSTS OF EDUCATION.

"(a) ALLOWANCE OF CREDIT. — In the case of an individual with respect to whom there is 1 or more eligible children for any taxable year, there shall be allowed as a credit against the tax imposed by this subtitle for such taxable year an amount equal to —

"(1) $800, multiplied by

"(2) the number of eligible children with respect to the individual.

"(b) LIMITATION BASED ON ADJUSTED GROSS INCOME. — The amount of the credit allowed by subsection (a) (determined without regard to this subsection) shall be reduced (but not below zero) by 5 percent of so much of the taxpayer's adjusted gross income as exceeds —

"(1) $150,000 in the case of a joint return,

"(2) $112,500 in the case of a head of household, and

"(3) $75,000 in the case of a taxpayer not described in paragraph (1) or (2).

"(c) ELIGIBLE CHILD. — The term 'eligible child' with respect to an individual for a taxable year means a qualifying child (as defined in section 152(c)) of the individual who is an elementary or secondary student (including kindergarten), if the school district in which such child resides was closed, in part or in full, or utilizing virtual, distance, or other alternative education models or a hybrid of such models and in-person attendance, during any part of the taxable year due to COVID–19.

"(d) TERMINATION. — This section shall not apply to taxable years beginning after December 31, 2021.".

(b) 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 costs of education.".

(c) CONFORMING AMENDMENT. — Section 6211(b)(4)(A) of the Internal Revenue Code of 1986 is amended by inserting ", 36A" after "36".

(d) EFFECTIVE DATE. — The amendments made by this section shall apply to taxable years beginning after December 31, 2019.

SEC. 3. FAMILY EDUCATION ASSISTANCE.

(a) ESTABLISHMENT OF FAMILY EDUCATION ASSISTANCE CREDIT. — Subpart C of part IV of subchapter A of chapter 1 of subtitle A of the Internal Revenue Code of 1986, as amended by section 2, is further amended by inserting after section 36B the following new section:

"SEC. 36C. FAMILY EDUCATION ASSISTANCE.

"(a) IN GENERAL. — As soon as practicable and not later than two weeks after the date of the enactment of this section, the Secretary shall establish a program for making family education assistance credit payments, including electronic payments, on a monthly basis, without respect to tax liability, for each citizen residing with a dependent qualifying child equal to $1,200 for each eligible month.

"(b) LIMITATIONS. —

"(1) LIMITATION BASED ON ADJUSTED GROSS INCOME. — The amount of the credit allowed by subsection (a) (determined without regard to this subsection) shall be reduced (but not below zero) by 5 percent of so much of the taxpayer's adjusted gross income as exceeds —

"(A) $150,000 in the case of a joint return,

"(B) $112,500 in the case of a head of household, and

"(C) $75,000 in the case of a taxpayer not described in subparagraph (A) or (B).

"(2) HOUSEHOLD LIMIT. — Family education assistance credit payments may only be claimed by one member of a household, and only one credit may be claimed per residence.

"(c) QUALIFYING CHILD. —

"(1) IN GENERAL. — In this section, the term 'qualifying child' means a qualifying child of the filer (as defined in section 152(c)) who has not attained 18 years of age.

"(2) EXCEPTION FOR CERTAIN NON-CITIZENS. — The term 'qualifying child' shall not include any individual who would not be a dependent if subparagraph (A) of section 152(b)(3) were applied without regard to all that follows 'resident of the United States'.

"(d) ELIGIBLE MONTH. — For purposes of this section —

"(1) IN GENERAL. — The term 'eligible month' means, with respect to a qualifying child, any month during which —

"(A) such child is an elementary or secondary student (including kindergarten), and

"(B) either —

"(i) the school district in which such child resides is closed, in part or in full, or utilizing virtual, distance, or other alternative education models or a hybrid of such models and in-person attendance, during any part of the month due to COVID–19, or

"(ii) the parent or guardian of such child elects not to send the child to school due to COVID–19.

"(2) APPLICATION AND TERMINATION. — The term 'eligible month' shall include only months beginning after July 31, 2020, and before July 1, 2021. In the case of eligible months occurring before the establishment of the program described in subsection (a), the credit amount attributable to such months shall be paid to the recipient in combination with the credit amount for the first eligible month during which such program is operational.

"(e) APPLICATION AND VERIFICATION. —

"(1) APPLICATION. — The Secretary shall establish an expedited process by which citizens may apply for and provide all necessary information to obtain access to installments of the family education assistance credit outside the annual tax return process utilizing —

"(A) information from the beneficiary's most recent tax return if the beneficiary has filed previously and such return is for 2018 or 2019, and

"(B) any additional or alternative information submissions deemed necessary by the Secretary to facilitate application, verification of eligibility for, and prompt delivery of the family education assistance credit.

"(2) VERIFICATION. — No credit shall be allowed under this section to a taxpayer on the basis of a qualifying child unless the taxpayer has provided the name and taxpayer identification number of such qualifying child in a manner deemed appropriate for the application process by the Secretary.

"(3) TREATMENT OF FAMILY EDUCATION ASSISTANCE CREDITS FOR INCOME TAX PURPOSES. —

"(A) NONTAXATION OF CREDIT. — Notwithstanding any other provision of law, no amount received as a family education assistance credit shall be treated as income for the purpose of calculating Federal, State, or local tax liability.

"(B) EFFECT ON TAX LIABILITY. — The tax liability of a recipient of the family education assistance credit for a taxable year in which payments of such credit are received shall be determined without respect to such credit.".

(b) CONFORMING AMENDMENTS. —

(1) Section 1324(b)(2) of title 31, United States Code, is amended by inserting ", 36C" after "36B".

(2) 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 before the item relating to section 37 the following new item:

"Sec. 36C. Family education assistance."