556
PUBLIC LAW 92-178-DEC. 10, 1971
[85 STAT.
ness and the taxpayer retains a substantial interest in such trade or business. " (3) SPECIAL RULE.—Any increase in tax under paragraph (1) shall not be treated as tax imposed by this chapter for purposes of determining the amount of any credit allowable under subpart A. " (d) FAILURE TO P A Y COMPARABLE WAGES.— " (1) GENERAL RULE.—Under regulations prescribed
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Ante,
p. 553,
26 USC 31.
?2 USC 632'.*
by the Secretary or his delegate, if during the period described in subsection (c)(1)(A), the taxpayer pays wages (as defined in section 50B (b)) to an employee with respect to whom work incentive program expenses are taken into account under subsection (a) which are less than the wages paid to other employees who perform comparable services, the tax under this chapter for the taxable year in which such wages are so paid shall be increased by an amount (determined under such regulations) equal to the credits allowed under section 40 for such taxable year and all prior taxable years attributable to work incentive program expenses paid or incurred with respect to such employee, and the carrybacks and carryovers under subsection (b) shall be properly adjusted. " (2) SPECIAL RULE.—Any increase in tax under paragraph (1) shall not be treated as tax imposed by this chapter for purposes of determining the amount of any credit allowable under subpart A. "SEC. SOB. DEFINITIONS; SPECIAL RULES. " (a) WORK INCENTIVE PROGRAM EXPENSES.—For purposes of this subpart, the term 'work incentive program expenses' means the wages paid or incurred by the taxpayer for services rendered during the first 12 months of employment (whether or not consecutive) of employees Avho are certified by the Secretary of Labor as— " (1) having been placed in employment under a work incentive program established under section 432(b)(1) of the Social SecurityAct,and _ _ " (2) not having displaced any individual from employment. " (b) WAGES.—For purposes of subsection (a), the term 'wages' means only cash remuneration (including amounts deducted and withheld). " (c) LIMITATIONS.— "(1) TRADE OR BUSINESS EXPENSES.—No
68^|^at.^43.
item shall be taken into account under subsection (a) unless such item is incurred in a trade or business of the taxpayer. "(2) REIMBURSED EXPENSES.—No item shall be taken into account under subsection (a) to the extent that the taxpayer is reimbursed for such item. "(3) GEOGRAPHICAL LIMITATION.—No item shall be taken into account under subsection (a) with respect to any expense paid or incurred by the taxpayer with respect to employment outside the United States. "(4) MAXIMUM PERIOD or TRAINING OR INSTRUCTION.—No item with respect to any employee shall be taken into account under subsection (a) after the end of the 24-month period beginning with the date of initial employment of such employee by the taxpayer. "(5) INELIGIBLE INDIVIDUALS.—No item shall be taken into account under subsection (a) with respect to an individual who— " (A) bears any of the relationships described in paragraphs (1) through (8) of section 152(a) to the taxpayer, or, if the taxpayer is a corporation, to an individual who owns, directly or indirectly, more than 50 percent in value of the outstanding stock of the corporation (determined with the application of section 267(c)),
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