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Page 2306 TITLE 26—INTERNAL REVENUE CODE § 1400S September 23, 2005, and Before January 1, 2006, Which Occurs During the Peri § 1400S TITLE 26—INTERNAL REVENUE CODE Page 2306 September 23, 2005, and before January 1, regard to section 3306(b)(2)(B)) paid or in- 2006, which occurs during the period— curred by an eligible employer with respect (i) beginning on the date on which the to an eligible employee on any day after Oc- trade or business described in subpara- tober 23, 2005, and before January 1, 2006, graph (A) first became inoperable at the which occurs during the period— principal place of employment of the em- (i) beginning on the date on which the ployee immediately before Hurricane Rita, trade or business described in subpara- and graph (A) first became inoperable at the (ii) ending on the date on which such principal place of employment of the em- trade or business has resumed significant ployee immediately before Hurricane operations at such principal place of em- Wilma, and ployment. (ii) ending on the date on which such Such term shall include wages paid without trade or business has resumed significant regard to whether the employee performs no operations at such principal place of em- services, performs services at a different ployment. place of employment than such principal Such term shall include wages paid without place of employment, or performs services at regard to whether the employee performs no such principal place of employment before services, performs services at a different significant operations have resumed. place of employment than such principal (3) Certain rules to apply place of employment, or performs services at For purposes of this subsection, rules simi- such principal place of employment before lar to the rules of sections 51(i)(1) and 52 shall significant operations have resumed. apply. (3) Certain rules to apply (4) Employee not taken into account more than For purposes of this subsection, rules simi- once lar to the rules of sections 51(i)(1) and 52 shall An employee shall not be treated as an eligi- apply. ble employee for purposes of this subsection (4) Employee not taken into account more than for any period with respect to any employer if once such employer is allowed a credit under sub- An employee shall not be treated as an eligi- section (a) or section 51 with respect to such ble employee for purposes of this subsection employee for such period. for any period with respect to any employer if (c) Employee retention credit for employers af- such employer is allowed a credit under sub- fected by Hurricane Wilma section (a) or (b) or section 51 with respect to (1) In general such employee for such period. For purposes of section 38, in the case of an (Added Pub. L. 109–135, title II, § 201(a), Dec. 21, eligible employer, the Hurricane Wilma em- 2005, 119 Stat. 2601.) ployee retention credit for any taxable year is an amount equal to 40 percent of the qualified § 1400S. Additional tax relief provisions wages with respect to each eligible employee of such employer for such taxable year. For (a) Temporary suspension of limitations on char- purposes of the preceding sentence, the itable contributions amount of qualified wages which may be taken (1) In general into account with respect to any individual Except as otherwise provided in paragraph shall not exceed $6,000. (2), section 170(b) shall not apply to qualified (2) Definitions contributions and such contributions shall not For purposes of this subsection— be taken into account for purposes of applying (A) Eligible employer subsections (b) and (d) of section 170 to other contributions. The term ‘‘eligible employer’’ means any employer— (2) Treatment of excess contributions (i) which conducted an active trade or For purposes of section 170— business on October 23, 2005, in the Wilma (A) Individuals GO Zone, and (ii) with respect to whom the trade or In the case of an individual— business described in clause (i) is inoper- (i) Limitation able on any day after October 23, 2005, and Any qualified contribution shall be al- before January 1, 2006, as a result of dam- lowed only to the extent that the aggre- age sustained by reason of Hurricane gate of such contributions does not exceed Wilma. the excess of the taxpayer’s contribution (B) Eligible employee base (as defined in subparagraph (G) of sec- The term ‘‘eligible employee’’ means with tion 170(b)(1)) over the amount of all other respect to an eligible employer an employee charitable contributions allowed under whose principal place of employment on Oc- section 170(b)(1). tober 23, 2005, with such eligible employer (ii) Carryover was in the Wilma GO Zone. If the aggregate amount of qualified con- (C) Qualified wages tributions made in the contribution year The term ‘‘qualified wages’’ means wages (within the meaning of section 170(d)(1)) (as defined in section 51(c)(1), but without exceeds the limitation of clause (i), such Page 2307 TITLE 26—INTERNAL REVENUE CODE § 1400S excess shall be added to the excess de- (1) which arise in the Hurricane Katrina dis- scribed in the portion of subparagraph (A) aster area on or after August 25, 2005, and of such section which precedes clause (i) which are attributable to Hurricane Katrina, thereof for purposes of applying such sec- (2) which arise in the Hurricane Rita disas- tion. ter area on or after September 23, 2005, and (B) Corporations which are attributable to Hurricane Rita, or (3) which arise in the Hurricane Wilma disas- In the case of a corporation— ter area on or after October 23, 2005, and which (i) Limitation are attributable to Hurricane Wilma. Any qualified contribution shall be al- In the case of any other losses, section lowed only to the extent that the aggre- 165(h)(2)(A) shall be applied without regard to gate of such contributions does not exceed the losses referred to in the preceding sentence. the excess of the taxpayer’s taxable in- (c) Required exercise of authority under section come (as determined under paragraph (2) 7508A of section 170(b)) over the amount of all other charitable contributions allowed In the case of any taxpayer determined by the under such paragraph. Secretary to be affected by the Presidentially declared disaster relating to Hurricane Katrina, (ii) Carryover Hurricane Rita, or Hurricane Wilma, any relief Rules similar to the rules of subpara- provided by the Secretary under section 7508A graph (A)(ii) shall apply for purposes of shall be for a period ending not earlier than Feb- this subparagraph. ruary 28, 2006. (3) Exception to overall limitation on itemized (d) Special rule for determining earned income deductions (1) In general So much of any deduction allowed under sec- In the case of a qualified individual, if the tion 170 as does not exceed the qualified con- earned income of the taxpayer for the taxable tributions paid during the taxable year shall year which includes the applicable date is less not be treated as an itemized deduction for than the earned income of the taxpayer for the purposes of section 68. preceding taxable year, the credits allowed (4) Qualified contributions under sections 24(d) and 32 may, at the elec- (A) In general tion of the taxpayer, be determined by sub- For purposes of this subsection, the term stituting— ‘‘qualified contribution’’ means any chari- (A) such earned income for the preceding table contribution (as defined in section taxable year, for (B) such earned income for the taxable 170(c)) if— (i) such contribution is paid during the year which includes the applicable date. period beginning on August 28, 2005, and (2) Qualified individual ending on December 31, 2005, in cash to an For purposes of this subsection— organization described in section (A) In general 170(b)(1)(A) (other than an organization de- The term ‘‘qualified individual’’ means scribed in section 509(a)(3)), any qualified Hurricane Katrina individual, (ii) in the case of a contribution paid by any qualified Hurricane Rita individual, and a corporation, such contribution is for re- any qualified Hurricane Wilma individual. lief efforts related to Hurricane Katrina, Hurricane Rita, or Hurricane Wilma, and (B) Qualified Hurricane Katrina individual (iii) the taxpayer has elected the applica- The term ‘‘qualified Hurricane Katrina in- tion of this subsection with respect to such dividual’’ means any individual whose prin- contribution. cipal place of abode on August 25, 2005, was (B) Exception located— (i) in the GO Zone, or Such term shall not include a contribution (ii) in the Hurricane Katrina disaster if the contribution is for establishment of a area (but outside the GO Zone) and such new, or maintenance in an existing, seg- individual was displaced from such prin- regated fund or account with respect to cipal place of abode by reason of Hurricane which the donor (or any person appointed or Katrina. designated by such donor) has, or reasonably (C) Qualified Hurricane Rita individual expects to have, advisory privileges with re- spect to distributions or investments by rea- The term ‘‘qualified Hurricane Rita indi- son of the donor’s status as a donor. vidual’’ means any individual (other than a qualified Hurricane Katrina individual) (C) Application of election to partnerships whose principal place of abode on September and S corporations 23, 2005, was located— In the case of a partnership or S corpora- (i) in the Rita GO Zone, or tion, the election under subparagraph (ii) in the Hurricane Rita disaster area (A)(iii) shall be made separately by each (but outside the Rita GO Zone) and such partner or shareholder. individual was displaced from such prin- (b) Suspension of certain limitations on personal cipal place of abode by reason of Hurricane casualty losses Rita.
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