WORK INCENTIVE PROGRAM EXPENSES.

SEC. 2107. WORK INCENTIVE PROGRAM EXPENSES. (a) Increase in Limitation Based on Amount of Tax.— (1) Paragraph (2) of section 50A(a) (relating to limitation based on amount of tax) is amended by striking out “$25,000” each place it appears and inserting in lieu thereof “$50,000”. (2) Paragraph (4) of section 50A(a) (relating to married individuals) is amended— (A) by striking out “$12,500” and inserting in lieu thereof “$25,000” and (B) by striking out “$25,000” and inserting in lieu thereof “$50,000” (3) Paragraph (5) of section 50A(a) (relating to controlled groups) is amended by striking out “$25,000” each place it appears therein and inserting in lieu thereof “$50,000”. (4) Paragraph (3) of section 50B(e) is amended by striking out “$25,000” each place it appears therein and inserting in lieu thereof “$50,000”. (b) Reduction of Period During Which Discharge of Employee Causes Recapture.— Subparagraph (A) of section 50A(c)(1) (relating to work incentive program expenses) is amended— (1) by striking out “12 months” each place it appears and inserting in lieu thereof “90 days”, (2) by striking out “12th calendar month” and inserting in lieu thereof “90th calendar day”, and (3) by striking out “the calendar month” and inserting in lieu thereof “the day”. 90 STAT. 1904 (c) Recapture Not To Apply Where Termination Is Result of Declining Business.— Subparagraph (A) of section 50A(c)(2) (relating to certain terminations of employment) is amended— (1) by striking out “or” at the end of clause (iii), (2) by striking out the period at the end of clause (iv) and inserting in lieu thereof a comma and “or”, and (3) by adding at the end thereof the following: “(v) a termination of employment of an individual due to a substantial reduction in the trade or business operations of the taxpayer.” (d) Extension of Welfare Employee Incentives.— Paragraph (2) of section 50B(a) (relating to definition of Federal welfare recipient employment incentive expenses) is amended by striking out “before July 1, 1976,” and inserting in lieu thereof “before January 1, 1980,”. (e) Limitation of Federal Welfare Recipient Employment Incentive Expenses to First 12 Months of Employment.— Subparagraph (B) of section 50B (a)(1) is amended to read as follows: “(B) the amount of Federal welfare recipient employment incentive expenses paid or incurred by the taxpayer for services rendered during the first 12 months of employment (whether or not consecutive).” (f) Certification of Welfare Recipient Employees by Secretary of Labor.— Subparagraph (A) of section 50B(g)(1) (relating to eligible employees) is amended by inserting “the Secretary of Labor or by” after “certified by”. (g) Technical Amendments.— (1) The second sentence of section 6411(a) (relating to application for adjustment.) is amended by inserting “(or, in the case of a work incentive program carryback, to an investment credit carryback)” after “capital loss carryback”. (2) The following provisions are each amended by inserting “, an investment credit carryback,” after “net operating loss carryback”: (A) Section 6501(o). (B) Section 6511(d)(7). (C) Section 6601(d)(4). (D) Section 6611(f)(4).