980
PUBLIC LAW 86-778-SEPT. 13, 1960
[74 S T A T.
amount is transferred pursuant to paragraph (1) to the unemployment account of any State, such amount shall be treated as an advance made before the date of the enactment of this Act. AMENDMENTS TO THE FEDERAL UNEMPLOYMENT TAX ACT
Increase in Tax Rate 26 USC 3301.
SEC. 523. (a) Section 3301 of the Internal Revenue Code (relating to rate of tax under Federal Unemployment Tax amended— (1) by striking out "1955" and inserting in lieu thereof and (2) by striking out "3 percent" and inserting in lieu "3.1 percent".
of 1954 Act) is "1961", thereof
Computation of Credits Against Tax 26 USC 3302.
^jj^ Section 3302 of such Code (relating to credits against tax) is amended by striking out subsection (c) and inserting in lieu thereof the following new subsections: " (c)
Ante, pp. 9 7 8,
L I M I T ON TOTAL CREDITS.—
"(1) The total credits allowed to a taxpayer under this section shall not exceed 90 percent of the tax against which such credits are allowable. "(2) If an advance or advances have been made to the unemployment account of a State under title X II of the Social Security Act before the date of the enactment of the Employment Security Act of 1960, then the total credits (after applying subsections (a) and (b) and paragraph (1) of this subsection) otherwise allowable under this section for the taxable year in the case of a taxpayer subject to the unemployment compensation law of such State shall be reduced— " (A) in the case of a taxable year baginning with the fourth consecutive January 1 as of the beginning of which there is a balance of such advances, by 5 percent of the tax imposed by section 3301 with respect to the wages paid by such taxpayer during such taxable year which are attributable to such State; and " (B) in the case of any succeeding taxable year beginning with a consecutive January 1 as of the beginning of which there is a balance of such advances, by an additional 5 percent, for each such succeeding taxable year, of the tax imposed by section 3301 with respect to the wages paid by such taxpayer during such taxable year which are attributable to such State. "(3) If an advance or advances have been made to the unemployment account of a State under title X II of the Social Security Act on or after the date of the enactment of the Employment Security Act of 1960, then the total credits (after applying subsections (a) and (b) and paragraphs (1) and (2) of this subsection) otherwise allowable under this section for the taxable year in the case of a taxpayer subject to the unemployment compensation law of such State shall be reduced— " (A)(i) in the case of a taxable year beginning with the second consecutive January 1 as of the beginning of which there is a balance of such advances, by 10 percent of the tax imposed by section 3301 with respect to the wages paid by such taxpayer during such taxable year which are attributable to such State: and
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