WORK OPPORTUNITY TAX CREDIT AND WELFARE-TO-WORK CREDIT.

SEC. 105. WORK OPPORTUNITY TAX CREDIT AND WELFARE-TO-WORK CREDIT.(a) In General.—Sections 51(c)(4)(B) and 51A(f) are each amended by striking “2005” and inserting “2007”.(b) Eligibility of Ex-Felons Determined Without Regard to Family Income.—Paragraph (4) of section 51(d) is amended by adding “and” at the end of subparagraph (A), by striking “, and” at the end of subparagraph (B) and inserting a period, and by striking all that follows subparagraph (B).(c) Increase in Maximum Age for Eligibility of Food Stamp Recipients.—Clause (i) of section 51(d)(8)(A) is amended by striking “25” and inserting “40”.(d) Extension of Paperwork Filing Deadline.—Section 51(d)(12)(A)(ii)(II) is amended by striking “21st day” and inserting “28th day”.(e) Consolidation of Work Opportunity Credit With Welfare-to-Work Credit.—(1) In general.—Paragraph (1) of section 51(d) is amended by striking “or” at the end of subparagraph (G), by striking the period at the end of subparagraph (H) and inserting “, or”, and by adding at the end the following new subparagraph:“(I) a long-term family assistance recipient.”.(2) Long-term family assistance recipient.—Subsection (d) of section 51 is amended by redesignating paragraphs (10) through (12) as paragraphs (11) through (13), respectively, and by inserting after paragraph (9) the following new paragraph:120 STAT. 2937 “(10) Long-term family assistance recipient.—The term ‘long-term family assistance recipient’ means any individual who is certified by the designated local agency—“(A) as being a member of a family receiving assistance under a IV–A program (as defined in paragraph (2)(B)) for at least the 18-month period ending on the hiring date,“(B)(i) as being a member of a family receiving such assistance for 18 months beginning after August 5, 1997, and“(ii) as having a hiring date which is not more than 2 years after the end of the earliest such 18-month period, or“(C)(i) as being a member of a family which ceased to be eligible for such assistance by reason of any limitation imposed by Federal or State law on the maximum period such assistance is payable to a family, and“(ii) as having a hiring date which is not more than 2 years after the date of such cessation.”.(3) Increased credit for employment of long-term family assistance recipients.—Section 51 is amended by inserting after subsection (d) the following new subsection:“(e) Credit for Second-Year Wages for Employment of Long-Term Family Assistance Recipients.—“(1) In general.—With respect to the employment of a long-term family assistance recipient—“(A) the amount of the work opportunity credit determined under this section for the taxable year shall include 50 percent of the qualified second-year wages for such year, and“(B) in lieu of applying subsection (b)(3), the amount of the qualified first-year wages, and the amount of qualified second-year wages, which may be taken into account with respect to such a recipient shall not exceed $10,000 per year.“(2) Qualified second-year wages.—For purposes of this subsection, the term ‘qualified second-year wages’ means qualified wages—“(A) which are paid to a long-term family assistance recipient, and“(B) which are attributable to service rendered during the 1-year period beginning on the day after the last day of the 1-year period with respect to such recipient determined under subsection (b)(2).“(3) Special rules for agricultural and railway labor.—If such recipient is an employee to whom subparagraph (A) or (B) of subsection (h)(1) applies, rules similar to the rules of such subparagraphs shall apply except that—“(A) such subparagraph (A) shall be applied by substituting ‘$10,000’ for ‘$6,000’, and“(B) such subparagraph (B) shall be applied by substituting ‘$833.33’ for ‘$500’.”.(4) Repeal of separate welfare-to-work credit.—(A) In general.—Section 51A is hereby repealed.(B) Clerical amendment.—The table of sections for subpart F of part IV of subchapter A of chapter 1 is amended by striking the item relating to section 51A.120 STAT. 2938(f) Effective Dates.—(1) In general.—Except as provided in paragraph (2), the amendments made by this section shall apply to individuals who begin work for the employer after December 31, 2005.(2) Consolidation.—The amendments made by subsections (b), (c), (d), and (e) shall apply to individuals who begin work for the employer after December 31, 2006.