92 STAT. 2836
Ante, p. 2834.
PUBLIC LAW 95-600—NOV. 6, 1978 (i) such individual shall be taken into account for purposes of the credit allowable by section 44B of the Internal Revenue Code of 1954 only if such individual is first hired by the employer after September 26, 1978, and (ii) such individual shall be treated for purposes of such credit as having first begun work for the employer not earlier than January 1, 1979. (B) MEMBER OF NEWLY TARGETED GROUP DEFINED.—For
Ante, p. 2830.
26 USC 53.
26 USC 53 note.
26 USC 50A.
26 USC 40.
purposes of subparagraph (A), an individual is a member of a newly targeted group i— f (i) such individual meets the requirements of subparagraph (A), (C), (D), (E), (F), or (G) of section 51(d)(1) of such Codo, and (ii) in the case of an individual meeting the requirements of subparagraph (A) of such section 51(d)(1), a credit was not claimed for such individual by the taxpayer for a taxable year beginning before January 1, 1979. (3) TRANSITIONAL RULE.—In the case of a taxable year which begins in 1978 and ends after December 81, 1978, the amount of the credit allowable by section 44B of the Internal Revenue Ckxle of 1954 (determined without regard to section 53 of such Code) shall be the sum of— (A) the amount of the credit which would be so allowable without regard to the amendments made by this section, plus (B) the amount which would be so allowable by reason of the amendments made by this section. (4) SUBSECTION (c)(2).—The amendments made by subsection (u)(2) shall apply to taxable years beginning after December 31, 1978. SEC. 322. WORK INCENTIVE PROGRAM CREDIT CHANGES. (a) CHANGES IN AMOUNT OF CREDIT.—Section 50A(a)
(relating to amount of credit) is amended by striking out paragraphs (1) and (2) and inserting in lieu thereof the following: "(1) GENERAL RULE.—The amount of the credit allowed by section 40 for the taxable year shall be equal to the sum o— f "(A) 50 percent of the first-year work incentive program expenses, and (B) 25 percent of the second-year work incentive program expenses. "(2) LIMITATION BASED ON AMOUNT OF TAX.—Notwithstanding
26 USC 50A.
paragraph (1), the amount of the credit allowed by section 40 for the taxable year shall not exceed the liability for tax for the taxable year.". (b) CHANGES IN LIMITATIONS.—Subsection (a) of section 50A is amended by striking out paragraphs (4), (5), and (6) and by inserting immediately after paragraph (3) the following new paragraph: "(4) LIMITATION WITH RESPECT TO NONBUSINESS ELIGIBLE EMPLOYEES.—
"(A) IN GENERAL.—In the case of any work incentive program expenses paid or incurred by the taxpayer during the taxable year to eligible employees whose services are not performed in connection with a trade or business of the taxpayer— "(i) paragraph (1)(A) shall be applied by substituting
- 35 percent for '50 percent',
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