H.R. 6458

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 6458 Introduced in House (IH)]

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119th CONGRESS
1st Session
H. R. 6458

To amend the Internal Revenue Code of 1986 to improve the electronic 
filing process for employment taxes.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

December 4, 2025

Ms. Malliotakis (for herself, Mr. Morelle, and Mr. Suozzi) introduced 
the following bill; which was referred to the Committee on Ways and 
Means

_______________________________________________________________________

A BILL

To amend the Internal Revenue Code of 1986 to improve the electronic 
filing process for employment taxes.

Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Electronic Filing Improvement and 
Logistical Efficiency Act of 2025''.

SEC. 2. SENSE OF CONGRESS.

It is the sense of Congress that--
(1) businesses and their third-party representatives should 
be able to file all employment tax forms and schedules, 
including amended returns, electronically;
(2) the current prevalence and reliance on paper by both 
the Internal Revenue Service and private sector businesses for 
quarterly and annual employment tax return filings is not 
sustainable and must be addressed immediately;
(3) the obstacles to electronic filing are both structural 
and behavioral; and
(4) the Internal Revenue Service must streamline the 
process for filing employment returns electronically, making it 
as easy and efficient as possible, while the internal revenue 
laws must incentivize the use of electronic filing to help 
rapidly overcome longstanding taxpayer behaviors.

SEC. 3. ELECTRONIC FILING FOR EMPLOYMENT TAX RETURNS.

Not later than 1 year after the date of the enactment of this Act, 
the Internal Revenue Service shall--
(1) make available to employers fully-automated electronic 
process for satisfying all filing and payment requirements 
(including amended returns) for taxes imposed under subtitle C 
of the Internal Revenue Code,
(2) first focus on making available pursuant to paragraph 
(1) the adjusted employer's quarterly Federal tax return or 
claim for refund (Form 941-X), and
(3) make all necessary technical and business changes to 
the electronic filing process to ensure that the process is 
fully automated on the front- and back-end and that electronic 
filing is the most convenient and efficient means of meeting 
such filing and payment requirements.

SEC. 4. ELECTRONIC FILING TAX CREDIT FOR EMPLOYERS.

(a) In General.--Subchapter D of chapter 21 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new section:

``SEC. 3135. ELECTRONIC FILING CREDIT FOR EMPLOYERS.

``(a) In General.--In the case of any employer required to make a 
quarterly return of the taxes imposed by subtitle C, there shall be 
allowed as a credit against applicable employment taxes with respect to 
such employer an amount equal to--
``(1) $1,000 for the calendar quarter for which the return 
and payment of such taxes are for the first time all made 
electronically, and
``(2) in the year following the year in which a credit is 
first determined for a calendar quarter under paragraph (1), 
$1,000 for 1 such calendar quarter elected by the employer in 
such year for which the return and payment of such taxes are 
all made electronically.
``(b) Credit Limited to Employment Taxes; Carry Forward.--
``(1) Limit.--The credit allowed by subsection (a) with 
respect to any calendar quarter shall not exceed the applicable 
employment taxes for such calendar quarter on the wages paid 
with respect to the employment of all employees of the 
employer.
``(2) Carryforward.--If the amount of the credit under 
subsection (a) exceeds the limitation of paragraph (1) for any 
calendar quarter, such excess shall be treated as a credit 
allowed under subsection (a) against the applicable employment 
taxes for the following calendar quarter.
``(c) Definition and Special Rules.--
``(1) Recapture.--
``(A) In general.--In the case of an employer 
allowed a credit under subsection (a) against an 
applicable employment tax for any calendar quarter, if 
the employer for any subsequent calendar quarter fails 
to make the return and payment of applicable employment 
taxes electronically, such tax shall for such 
subsequent calendar quarter be increased by the amount 
of such credit so allowed.
``(B) No credit following recapture.--In the case 
of an employer with respect to which subparagraph (A) 
applies for any quarter, no credit shall be allowed 
under subsection (a) for any subsequent quarter.
``(2) Exception for extraordinary circumstances.--
``(A) Extraordinary circumstances.--A taxpayer 
shall not be treated as failing to make the return and 
payment of applicable employment taxes electronically 
for purposes of paragraph (1) under such circumstances 
as the Secretary may by exception provide, including an 
employer's lack of ready access to broadband or 
convenient online services due to rural or other 
geographic barriers or emergency situations where 
electronic filing and payment would cause undue 
hardship.
``(B) Deemed compliance for certain bulk filers.--
For purposes of this section, in the case of a third 
party provider, including a payroll service provider, 
who for the 1-year period preceding the filing of any 
return to which paragraph (1)(A) would apply (without 
regard to this subparagraph) filed electronically at 
least 99 percent of all returns described in subsection 
(a) that were made by the provider during such period, 
no credit shall be recaptured under paragraph (1)(A) by 
reason of such return.
``(d) Applicable Employment Taxes.--For purposes of this section, 
the term `applicable employment taxes' means the following:
``(1) The taxes imposed by subsections (a) and (b) of 
section 3111.
``(2) So much of the taxes imposed by section 3221 as are 
attributable to the rates in effect under subsections (a) and 
(b) of section 3111.
``(e) Special Rules.--
``(1) Aggregation rule.--All persons treated as a single 
employer under subsection (a) or (b) of section 52, or 
subsection (m) or (o) of section 414, shall be treated as one 
employer for purposes of this section.
``(2) Governmental entities.--No credit shall be allowed 
under this section to the Government of the United States, the 
government of any State or political subdivision thereof, or to 
any agency or instrumentality of any of the foregoing. The 
preceding sentence shall not apply to any organization 
described in section 501(c)(1) and exempt from tax under 
section 501(a).''.
(b) Clerical Amendment.--The table of sections for subchapter D of 
chapter 21 of such Code is amended by adding at the end the following 
new item:

``Sec. 3135. Electronic filing credit.''.
(c) Effective Date.--The amendments made by this section shall 
apply to calendar quarters beginning after the date of the enactment of 
this Act.

SEC. 5. USER FEE FOR PAPER FILING OF EMPLOYMENT TAXES.

(a) In General.--Chapter 25 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new section:

``SEC. 3513. USER FEES.

``(a) In General.--The Secretary shall impose a user fee of $250 on 
each submission other than by electronic means of any quarterly or 
annual return required with respect to the collection of the tax 
imposed by chapter 21 or 23A.
``(b) Special Rules.--For purpose of this section--
``(1) Exception.--The Secretary shall establish procedures 
for granting exceptions to the fee imposed by subsection (a) 
where electronic filing is not feasible, including for under 
any of the following circumstances:
``(A) Any employer not required to make a quarterly 
return of the taxes imposed by subtitle C.
``(B) First and second-time submissions filed other 
than by electronic means shall have the user fee 
waived, with a written notification sent to the 
employer outlining the electronic submission 
requirement.
``(C) Employers who do not have ready access to 
broadband or convenient online services due to rural or 
other geographic barriers.
``(D) Certain emergency situations where electronic 
filing and payment would cause undue hardship.
``(E) Recent victims of identity theft or 
cybercrimes where submissions other than by electronic 
means might be necessary or desirable.
``(F) Such other circumstances as may be provided 
by the Secretary in regulations or other guidance.
Any person qualifying for an exception under this section or 
other applicable law shall be provided alternative submission 
options such as a paper filing.
``(2) Certain bulk filers.--In the case of a third party 
provider, including a payroll service provider, who for the 1-
year period preceding the filing of any return to which 
subsection (a) applies filed electronically at least 99 percent 
of all returns described in subsection (a) that were made by 
the provider during such period, no user fee shall be imposed 
with respect to such return under subsection (a).''.
(b) Clerical Amendment.--The table of sections for chapter 25 of 
such Code is amended by adding at the end the following new item:

``Sec. 3135. User fees.''.
(c) Effective Date.--The amendments made by this section shall 
apply to returns required to be made for periods ending later than 2 
years after the date of the enactment of this Act.
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