,i  #aacth ,,congress  #ast ,session    
,h4 ,r4 #cjdf  ,,in ,,the ,,house ,,of  
,,representatives  ,august #b1 #bjac    
,mr4 ,pallone introduced the following  
bill2 which was referred to the         
,committee on ,ways and ,means  ,a      
,,bill  ,to amend the ,internal ,revenue
 ,code of #aihf to expand and simplify  
the credit for employee health insurance
 expenses of small employers4  #a4      
,short title ,this ,act may be cited as 
the ,small ,business ,health ,care ,tax 
,credit ,improvement ,act of #bjac4  #b4
 ,expansion and simplification of credit
 for employee health insurance expenses 
of small employers  7a7 ,increase in    
maximum number of eligible full-,time   
employees ,subparagraph 7,a7 of section 
#de,r7d77#a7 of the ,internal ,revenue  
,code of #aihf is amended by striking   
#be full-time equivalent employees and  
inserting #ej full-time equivalent      
employees4  7b7 ,modification of        
phaseout of credit amount  7#a7 ,in     
general ,subsection 7c7 of section #de,r

 of such ,code is amended to read as    
follows3  7c7 ,phaseout of credit amount
 based on number of employees and       
average wages  7#a7 ,in general ,the    
amount of the credit determined under   
subsection 7b7 shall be adjusted by     
multiplying--  7,a7 the amount          
determined under subsection 7b71 by     
7,b7 the product of the amount          
determined under paragraph 7#b7 and the 
amount determined under paragraph 7#c74 
7#b7 ,employee adjustment ,the amount   
determined under this paragraph is a    
fraction 7not more than #a7 the         
numerator of which is the number by     
which the total number of full-time     
equivalent employees of the eligible    
employer is less than #ej and the       
denominator of which is #cj4  7#c7      
,wages adjustment ,the amount determined
 under this paragraph is a fraction 7not
 more than #a7 the numerator of which is
 the amount by which the average annual 
wages of the eligible employer is less  
than twice the dollar amount in effect  

under subsection 7d77#c77;,b7 and the   
denominator of which is such dollar     
amount4  4  7#b7 ,conforming amendments 
7,a7 ,subsection 7a7 of section #de,r of
 such ,code is amended by inserting 1 as
 adjusted under subsection 7c7 after the
 amount determined under subsection 7b74
  7,b7 ,subsection 7b7 of section #de,r 
of such ,code is amended by striking    
,subject to subsection 7c71 the and     
inserting ,the4  7,c7 ,subparagraph 7,b7
 of section #de,r7d77#c7 of such ,code  
is amended by striking subsection       
7c77#b7 and inserting subsection        
7c77#c74  7c7 ,average annual wage      
limitation increase  7#a7 #bjab and     
#bjac ,clause 7i7 of section            
#de,r7d77#c77;,b7 of such ,code is      
amended to read as follows3  7i7 #bjaj1 
#bjaa1 #bjab1 and #bjac ,the dollar     
amount in effect under this paragraph   
is--  7,i7 for taxable years beginning  
in #bjaj1 #bjaa1 or #bjab1 #be1jjj1 and 
7,,ii7 for taxable years beginning in   
#bjac1 #bh1ejj4  4  7#b7 ,subsequent    

years ,clause 7ii7 of section           
#de,r7d77#c77;,b7 of such ,code is      
amended by striking #be1jjj and         
inserting #bh1ejj4  7d7 ,repeal of      
uniformity requirement for contributions
 ,paragraph 7#d7 of section #de,r7d7 of 
such ,code is amended--  7#a7 by        
striking in an amount equal to a uniform
 percentage 7not less than #ej percent7 
of the premium cost of the qualified    
health plan1 and  7#b7 by inserting 7in 
an amount not less than #ej percent of  
the premium cost of the qualified health
 plan7 after nonelective contribution4  
7e7 ,repeal of limitation based on state
 average premiums  7#a7 ,in general     
,subsection 7b7 of section #de,r of such
 ,code is amended to read as follows3   
7b7 ,health insurance credit amount     
,subject to subsection 7c71 the amount  
determined under this subsection with   
respect to any eligible small employer  
is equal to #ej percent 7#ce percent in 
the case of a tax-exempt eligible small 
employer7 of the aggregate amount of    

nonelective contributions the employer  
made on behalf of its employees during  
the taxable year under the arrangement  
described in subsection 7d77#d7 for     
premiums for qualified health plans     
offered by the employer to its employees
 through an ,exchange4  4  7#b7         
,conforming amendment ,paragraph 7#b7 of
 section #de,r7g7 of such ,code is      
amended by inserting and at the end of  
subparagraph 7,a71 by striking 1 and at 
the end of subparagraph 7,b7 and        
inserting a period1 and by striking     
subparagraph 7,c74  7f7 ,effective date 
,the amendments made by this section    
shall apply to taxable years beginning  
after ,december #ca1 #bjab4