Washington — Two senators unveiled legislation to extend a tax credit for small businesses that provide differential pay for military reservists and National Guard members called to serve on active duty.
U.S. Sens. Gary Peters, D-Bloomfield Township, and Joni Ernst, R-Iowa, introduced the Military Reserve Small Business Jobs Act of 2015 to extend the tax credit for five years — which would would help 824,000 reservists and their families while on active duty. Peters is a former lieutenant commander in the Navy Reserve and Ernst serves as a lieutenant colonel in the Iowa Army National Guard.
The credit expired last year, but Congress may opt to retroactively extend it.
"Reservists in Michigan and across the country put their lives on the line and stand ready to protect our country," Peters said. "Our reservists should not have to worry about whether they will be able to provide for their families when called to serve our nation on active duty. This bipartisan, commonsense legislation will ensure American stands by our commitment to support our men and women in uniform as well as their families and support the small businesses that go above and beyond by providing differential pay to activated reservists."
Originally enacted in 2008 as part of the Heroes Earnings Assistance and Relief Tax Act, the employer wage credit for military reservists on active duty helps small businesses that provide differential pay to employees who have been called to active duty. The provision provides a tax credit for 20 percent of the differential salary payment for small businesses with fewer than 50 employees.