[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[S. 2434 Introduced in Senate (IS)]
<DOC>
117th CONGRESS
1st Session
S. 2434
To provide tax incentives that support local newspapers and other local
media, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
July 22, 2021
Ms. Cantwell (for herself, Mr. Kelly, and Mr. Wyden) introduced the
following bill; which was read twice and referred to the Committee on
Finance
_______________________________________________________________________
A BILL
To provide tax incentives that support local newspapers and other local
media, 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 ``Local Journalism Sustainability
Act''.
SEC. 2. CREDIT FOR LOCAL NEWSPAPER SUBSCRIPTIONS.
(a) In General.--Subpart A of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended by inserting after
section 25D the following new section:
``SEC. 25E. LOCAL NEWSPAPER SUBSCRIPTIONS.
``(a) In General.--In the case of an individual, there shall be
allowed as a credit against the tax imposed by this chapter for the
taxable year an amount equal to the applicable percentage of amounts
paid or incurred for subscriptions to one or more local newspapers for
the personal use of the taxpayer.
``(b) Annual Dollar Limitation.--The credit allowed under
subsection (a) to any taxpayer for any taxable year shall not exceed
$250.
``(c) Applicable Percentage.--For purposes of this section, the
term `applicable percentage' means--
``(1) in the case of the first taxable year to which this
section applies, 80 percent, and
``(2) in the case of any subsequent taxable year, 50
percent.
``(d) Local Newspaper.--For purposes of this section--
``(1) In general.--The term `local newspaper' means any
print or digital publication if--
``(A) the primary content of such publication is
original content derived from primary sources and
relating to news and current events,
``(B) such publication primarily serves the needs
of a regional or local community,
``(C) the publisher of such publication employs at
least one local news journalist who resides in such
regional or local community, and
``(D) the publisher of such publication employs not
greater than 1,000 employees.
``(2) Local news journalist.--For purposes of paragraph
(1)(C), the term `local news journalist' means any individual
who regularly gathers, collects, photographs, records, writes,
or reports news or information that concerns local events or
other matters of local public interest.
``(3) Aggregation rule.--
``(A) In general.--For purposes of subparagraphs
(C) and (D) of paragraph (1), all persons treated as a
single employer under subsection (a) or (b) of section
52, or subsection (m) or (o) of section 414, shall be
treated as one person.
``(B) Exception.--Subparagraph (A) shall not apply
unless such persons are involved in the production of
the same print or digital publication.
``(4) Continuous qualification.--The requirements of
subparagraphs (A) and (B) of paragraph (1) shall not be treated
as met unless such requirements are met at all times during the
period beginning on the date which is 2 years before the date
of the enactment of this section and ending on the date that
the subscription described in subsection (a) is paid or
incurred.
``(5) Application to certain organizations exempt from
tax.--In the case of any print or digital publication which is
published by any organization described in section 501(c) and
exempt from tax under section 501(a)--
``(A) such publication shall be treated as a local
newspaper only if the publication of print and digital
publications is the primary activity of such
organization, and
``(B) any person making a charitable contribution
(as defined in section 170(c)) to such organization may
elect to treat such contribution as an amount paid or
incurred for a subscription to which this section
applies in lieu of treating such contribution as a
charitable contribution for purposes of section 170.
``(e) Termination.--No credit shall be allowed under this section
for any amount paid or incurred in a taxable year ending after the
close of 5-year period beginning on the date of the enactment of this
section.''.
(b) Clerical Amendment.--The table of sections for subpart A 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 25D the
following new item:
``Sec. 25E. Local newspaper subscriptions.''.
(c) Effective Date.--The amendments made by this section shall
apply to amounts paid or incurred in taxable years beginning after the
date of the enactment of this Act.
SEC. 3. PAYROLL CREDIT FOR COMPENSATION OF LOCAL NEWS JOURNALISTS.
(a) In General.--Subchapter D of chapter 21 of the Internal Revenue
Code of 1986 is amended by adding at the end the following new section:
``SEC. 3135. LOCAL NEWS JOURNALIST COMPENSATION CREDIT.
``(a) In General.--In the case of an eligible local news journalist
employer, there shall be allowed as a credit against the taxes imposed
by section 3111(a) for each calendar quarter an amount equal to the
applicable percentage of wages paid by such employer to local news
journalists for such calendar quarter.
``(b) Limitations and Refundability.--
``(1) Wages taken into account.--The amount of wages paid
with respect to any individual which may be taken into account
under subsection (a) during any calendar quarter by the
eligible local news journalist employer shall not exceed
$12,500.
``(2) Credit limited to employment taxes.--The credit
allowed by subsection (a) with respect to any calendar quarter
shall not exceed the applicable employment taxes (reduced by
any credits allowed under subsections (e) and (f) of section
3111, section 3131, 3132, and 3134) on the wages paid with
respect to the employment of all the employees of the eligible
local news journalist employer for such calendar quarter.
``(3) Refundability of excess credit.--If the amount of the
credit under subsection (a) exceeds the limitation of paragraph
(2) for any calendar quarter, such excess shall be treated as
an overpayment that shall be refunded under sections 6402(a)
and 6413(b).
``(c) Definitions.--For purposes of this section--
``(1) Applicable percentage.--The term `applicable
percentage' means--
``(A) in the case of each of the first 4 calendar
quarters to which this section applies, 50 percent, and
``(B) in the case of each calendar quarter
thereafter, 30 percent.
``(2) Eligible local news journalist employer.--
``(A) In general.--The term `eligible local news
journalist employer' means, with respect to any
calendar quarter, any employer which--
``(i) is--
``(I) an eligible local newspaper
publisher,
``(II) an eligible digital news
organization,
``(III) a broadcast station, or
``(IV) a public broadcasting
entity, and
``(ii) employs local news journalists.
``(B) Eligible local newspaper publisher.--The term
`eligible local newspaper publisher' means, with
respect to any calendar quarter, any employer if
substantially all of the gross receipts of such
employer for such calendar quarter are derived in the
trade or business of publishing local newspapers (as
defined in section 25E(d)(1)).
``(C) Eligible digital news organization.--The term
`eligible digital news organization' means a digital
information content provider which is engaged in the
creation of original local or regional news and
information.
``(D) Broadcast station.--The term `broadcast
station' has the meaning given such term under section
3 of the Communications Act of 1934 (47 U.S.C. 153).
``(E) Public broadcasting entity.--The term `public
broadcasting entity' has the meaning given such term
under section 397(11) of the Communications Act of 1934
(47 U.S.C. 397(11)).
``(3) Local news journalist.--The term `local news
journalist' means--
``(A) with respect to any eligible local newspaper
publisher for any calendar quarter, any individual who
provides at least 100 hours of service during such
quarter in the gathering, collecting, photographing,
recording, writing, or reporting news or information
that concerns local events or other matters of local
public interest during such calendar quarter to such
employer, and
``(B) with respect to any eligible digital news
organization, broadcast station, or public broadcasting
entity for any calendar quarter, any individual who
provides at least 100 hours of service during such
quarter in the original reporting, gathering,
collecting, writing, editing, producing, verification,
recording, photographing, presentation, design, or
technology support of news or information that concerns
regional or local events or other matters of regional
or local public interest.
``(4) Other terms.--Any term used in this section which is
also used in this chapter shall have the same meaning as when
used in such chapter.
``(d) Aggregation Rule.--
``(1) In general.--All persons treated as a single employer
under subsection (a) or (b) of section 52, or subsection (m) or
(o) of section 414, shall be treated as one employer for
purposes of this section.
``(2) Exception.--Paragraph (1) shall not apply unless such
persons are involved in the production of the same print or
digital publication.
``(e) Certain Rules To Apply.--For purposes of this section, rules
similar to the rules of sections 51(i)(1) and 280C(a) shall apply.
``(f) Certain Governmental Employers.--
``(1) In general.--This credit shall not apply to the
Government of the United States, the government of any State or
political subdivision thereof, or any agency or instrumentality
of any of the foregoing.
``(2) Exception.--Paragraph (1) shall not apply to any
public broadcasting entity (as defined in section 397(11) of
the Communications Act of 1934 (47 U.S.C. 397(11))).
``(g) Election To Have Section Not Apply.--This section shall not
apply with respect to any eligible local news journalist employer for
any calendar quarter if such person elects (at such time and in such
manner as the Secretary may prescribe) not to have this section apply.
``(h) Special Rules.--
``(1) Employee not taken into account more than once.--An
employee shall not be included for purposes of this section for
any period with respect to any employer if such employer is
allowed a credit under section 51 with respect to such employee
for such period.
``(2) Denial of double benefit.--Any wages taken into
account in determining the credit allowed under this section
shall not be taken into account for purposes of determining the
credit allowed under section 45S.
``(3) Third-party payors.--Any credit allowed under this
section shall be treated as a credit described in section
3511(d)(2) of such Code.
``(i) Treatment of Deposits.--The Secretary shall waive any penalty
under section 6656 for any failure to make a deposit of any applicable
employment taxes if the Secretary determines that such failure was due
to the reasonable anticipation of the credit allowed under this
section.
``(j) Extension of Limitation on Assessment.--Notwithstanding
section 6501, the limitation on the time period for the assessment of
any amount attributable to a credit claimed under this section shall
not expire before the date that is 5 years after the later of--
``(1) the date on which the original return which includes
the calendar quarter with respect to which such credit is
determined is filed, or
``(2) the date on which such return is treated as filed
under section 6501(b)(2).
``(k) Regulations and Guidance.--The Secretary shall issue such
forms, instructions, regulations, and guidance as are necessary--
``(1) to allow the advance payment of the credit under
subsection (a), subject to the limitations provided in this
section, based on such information as the Secretary shall
require,
``(2) to provide for the reconciliation of such advance
payment with the amount advanced at the time of filing the
return of tax for the applicable calendar quarter or taxable
year,
``(3) with respect to the application of the credit under
subsection (a) to third-party payors (including professional
employer organizations, certified professional employer
organizations, or agents under section 3504), including
regulations or guidance allowing such payors to submit
documentation necessary to substantiate the eligible employer
status of employers that use such payors, and
``(4) to prevent the avoidance of the purposes of the
limitations under this section.
Any forms, instructions, regulations, or other guidance described in
paragraph (3) shall require the customer to be responsible for the
accounting of the credit and for any liability for improperly claimed
credits and shall require the certified professional employer
organization or other third-party payor to accurately report such tax
credits based on the information provided by the customer.
``(l) Application.--This section shall only apply to wages paid in
calendar quarters beginning after the date of the enactment of this
section and beginning before the date that is 5 years after the first
day of the first calendar quarter to which this section applies.''.
(b) Refunds.--Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting ``3135,'' after ``3134,''.
(c) Clerical Amendment.--The table of sections for subchapter D of
chapter 21 of the Internal Revenue Code of 1986 is amended by adding at
the end the following:
``Sec. 3135. Local news journalist compensation credit.''.
(d) Effective Date.--The amendments made by this section shall
apply to calendar quarters beginning after the date of the enactment of
this Act.
SEC. 4. CREDIT FOR ADVERTISING IN LOCAL NEWSPAPERS AND LOCAL MEDIA.
(a) In General.--Subpart D of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended by adding at the end
the following new section:
``SEC. 45U. ADVERTISING IN LOCAL NEWSPAPERS AND LOCAL MEDIA.
``(a) In General.--For purposes of section 38, in the case of any
eligible small business, the local media advertising credit determined
under this section for any taxable year is an amount equal to the
applicable percentage of the qualified local media advertising expenses
paid or incurred by the taxpayer during such taxable year.
``(b) Limitation.--The credit allowed under subsection (a) to any
taxpayer for any taxable year shall not exceed--
``(1) in the case of the first taxable year to which this
section applies, $5,000, and
``(2) in the case of any subsequent taxable year, $2,500.
``(c) Applicable Percentage.--For purposes of this section, the
term `applicable percentage' means--
``(1) in the case of the first taxable year to which this
section applies, 80 percent, and
``(2) in the case of any subsequent taxable year, 50
percent.
``(d) Eligible Small Business.--For purposes of this section, the
term `eligible small business' means any person for any taxable year if
the average number of full-time employees (as determined for purposes
of determining whether an employer is an applicable large employer for
purposes of section 4980H(c)(2) of the Internal Revenue Code of 1986)
employed by such person during such taxable year was less than 50.
``(e) Qualified Local Media Advertising Expenses.--For purposes of
this section--
``(1) In general.--The term `qualified local media
advertising expenses' means amounts paid or incurred in the
ordinary course of a trade or business for advertising--
``(A) in a local newspaper (as defined in section
25E(d)), or
``(B) through a broadcast of, or in the digital
content or digital publications of, a local radio or
television station.
``(2) Local radio or television station.--The term `local
radio or television station' means any broadcast radio or
television station licensed by the Federal Communications
Commission to serve a local community.
``(f) Special Rules.--
``(1) Denial of double benefit.--No deduction shall be
allowed for any qualified local media advertising expenses
otherwise allowable as a deduction for the taxable year which
is equal to the amount of the credit determined for such
taxable year under subsection (a).
``(2) Aggregation rule.--All persons treated as a single
employer under subsection (a) or (b) of section 52 of the
Internal Revenue Code of 1986, or subsection (m) or (o) of
section 414 of such Code, shall be treated as one employer for
purposes of this section.
``(g) Termination.--No credit shall be allowed under this section
for any amount paid or incurred in a taxable year ending after the
close of 5-year period beginning on the date of the enactment of this
section.''.
(b) Credit Allowed as Part of General Business Credit.--Section
38(b) of the Internal Revenue Code of 1986 is amended by striking
``plus'' at the end of paragraph (32), by striking the period at the
end of paragraph (33) and inserting ``, plus'', and by adding at the
end the following new paragraph:
``(34) in the case of an eligible small business, the local
media advertising credit determined under section 45U(a).''.
(c) Clerical Amendment.--The table of sections for subpart D of
part IV of subchapter A of chapter 1 of such Code is amended by adding
at the end the following new item:
``Sec. 45U. Advertising in local newspapers and local media.''.
(d) Effective Date.--The amendments made by this section shall
apply to amounts paid or incurred in taxable years beginning after the
date of the enactment of this Act.
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