INCREASE IN RESEARCH CREDIT AGAINST PAYROLL TAX FOR SMALL BUSINESSES.

SEC. 13902. INCREASE IN RESEARCH CREDIT AGAINST PAYROLL TAX FOR SMALL BUSINESSES.(a) In General.—Clause (i) of section 41(h)(4)(B) is amended—(1) by striking “Amount.—The amount” and inserting “Amount.—“(I) In general.—The amount” , and (2) by adding at the end the following new subclause:“(II) Increase.—In the case of taxable years beginning after December 31, 2022, the amount in subclause (I) shall be increased by $250,000.” . (b) Allowance of Credit.—(1) In general.—Paragraph (1) of section 3111(f) is amended—(A) by striking “for a taxable year, there shall be allowed” and inserting “for a taxable year—“(A) there shall be allowed” , (B) by striking “equal to the” and inserting “equal to so much of the”, (C) by striking the period at the end and inserting “as does not exceed the limitation of subclause (I) of section 41(h)(4)(B)(i) (applied without regard to subclause (II) thereof), and”, and136 STAT. 2014 (D) by adding at the end the following new subparagraph:“(B) there shall be allowed as a credit against the tax imposed by subsection (b) for the first calendar quarter which begins after the date on which the taxpayer files the return specified in section 41(h)(4)(A)(ii) an amount equal to so much of the payroll tax credit portion determined under section 41(h)(2) as is not allowed as a credit under subparagraph (A).” . (2) Limitation.—Paragraph (2) of section 3111(f) is amended—(A) by striking “paragraph (1)” and inserting “paragraph (1)(A)”, and (B) by inserting “, and the credit allowed by paragraph (1)(B) shall not exceed the tax imposed by subsection (b) for any calendar quarter,” after “calendar quarter”. (3) Carryover.—Paragraph (3) of section 3111(f) is amended by striking “the credit” and inserting “any credit”. (4) Deduction allowed.—Paragraph (4) of section 3111(f) is amended—(A) by striking “credit” and inserting “credits”, and (B) by striking “subsection (a)” and inserting “subsection (a) or (b)”. (c) Aggregation Rules.—Clause (ii) of section 41(h)(5)(B) is amended by striking “the $250,000 amount” and inserting “each of the $250,000 amounts”. (d) Effective Date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2022.