HIRE CREDIT Act

Bill Number

H.R. 1914

Origin Chamber

House

Congress

119th Congress, Session 1

Policy Area

Taxation

Status

Introduced

Latest Action

2025-03-06: Referred to the House Committee on Ways and Means.

Last Updated

2025-05-08T14:02:06Z

AI-Generated Summary

Purpose of the Legislation

The HIRE CREDIT Act aims to support economic recovery in areas affected by major disasters by incentivizing employers to hire individuals displaced by these events. It expands an existing tax credit to encourage employment opportunities for disaster victims, helping communities rebuild through job creation.

Key Provisions

• Expansion of Work Opportunity Tax Credit (WOTC): Adds "displaced disaster victim" as a new eligible category under Section 51(d) of the Internal Revenue Code (IRC), which provides tax credits to employers for hiring certain groups facing employment barriers.
• Definition of Displaced Disaster Victim:
• An individual certified by a designated local agency (typically a state workforce agency) as:
• Having a principal home in a "qualified disaster zone" that became uninhabitable due to the disaster.
• Previously employed in that zone at a location made inoperable by the disaster.
• Currently unemployed.
• Hiring must occur within one year after the end of the disaster's "incident period" (the time frame defined by the Federal Emergency Management Agency, or FEMA, when the disaster occurred, starting no earlier than January 1, 2024).
• Limitations:
• If the job is full-time (30+ hours per week) outside the disaster zone, wages for that week do not qualify for the credit.
• Qualified Disaster Zone: An area where the President declared a major disaster on or after January 1, 2024, under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, and where federal individual or public assistance was deemed necessary.
• Effective Date: Applies to hires starting on or after January 1, 2024.
• Transition Rules: For disasters ending before the bill's enactment, the one-year hiring window begins from the enactment date, and unemployment status is assessed before the hire date.

Significant Changes to Existing Law

• Amendment to IRC Section 51(d): Introduces a new subparagraph (K) and paragraph (16) specifically for displaced disaster victims, building on the existing WOTC framework that already covers groups like veterans, ex-felons, and long-term unemployed individuals.
• Time-Limited Scope: Unlike some permanent WOTC categories, this is temporary, tied to disasters from 2024 onward and a one-year post-incident hiring period, with no extension beyond that unless further legislation passes.
• Certification Process: Relies on local agencies for verification, similar to other WOTC categories, but links directly to presidential disaster declarations and FEMA incident periods.

Potential Impacts

• On Government Agencies: The Internal Revenue Service (IRS) will administer the expanded tax credit, potentially increasing claims processing. FEMA and state agencies may see more coordination for certifications, aiding disaster response without new funding mandates.
• On Citizens: Displaced workers in affected areas gain better job prospects through employer incentives, potentially speeding personal recovery and reducing unemployment in disaster-hit communities. Employers, especially small businesses, benefit from tax savings (up to $9,600 per eligible hire under current WOTC rules, though not specified here).
• On International Relations: No direct impact, as the bill focuses on domestic disasters and U.S. tax policy.
• Broader Economic Effects: Could stimulate local economies in disaster zones by promoting quick re-employment, though limited to post-2024 events.

Main Stakeholders Affected

• Employers: Primary beneficiaries via tax credits, particularly those in or near disaster zones seeking to expand workforce.
• Displaced Disaster Victims: Individuals (e.g., residents or workers in areas like hurricane- or flood-struck regions) who qualify for jobs with incentivized hiring.
• Government Entities: IRS (tax credit oversight), FEMA (disaster declarations), state/local workforce agencies (certifications), and Congress (potential future extensions).
• Communities: Residents and businesses in qualified disaster zones, supporting faster recovery efforts.

Notable Legal, Constitutional, or Political Implications

• Legal: Aligns with existing tax incentive structures under the IRC, requiring no major overhaul. Certification by local agencies ensures administrative feasibility, but could face challenges if disaster declarations are disputed. The bill's retroactive element (from January 1, 2024) may prompt IRS guidance on past hires.
• Constitutional: No apparent issues; it involves Congress's taxing and spending powers under Article I, promoting general welfare through disaster aid without targeting specific groups in a discriminatory way.
• Political: Introduced by Democratic representatives, it emphasizes bipartisan disaster recovery themes (e.g., referencing Stafford Act). If passed, it could set a precedent for targeted tax relief in future crises, potentially influencing budget debates on disaster funding versus tax expenditures.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Crockett, Jasmine [D-TX-30]

Cosponsors (3)

Rep. Edwards, Chuck [R-NC-11], Rep. Chu, Judy [D-CA-28], Rep. Moskowitz, Jared [D-FL-23]

Recent Actions

• 2025-03-06: Referred to the House Committee on Ways and Means.
• 2025-03-06: Introduced in House
• 2025-03-06: Introduced in House

Bill Versions

• Helping Increase Realtime Employment for Communities Recovering from Emergency Disasters for an Interim Time Act — issued 2025-03-06 — PDF (5 pages)