ALEXANDRIA, VA, May 6, 2025 — The National Association of Professional Employer Organizations (NAPEO) today commended a bipartisan pair of lawmakers for their introduction of a bill establishing a clear and fair liability determination process for payroll tax credit claims made by PEO clients.
Legislation introduced today by Reps. Mike Thompson (D-CA) and Beth Van Duyne (R-TX) establishes that the liability for payroll tax credit claims made by PEO clients belongs to the entity that initiates and benefits from the claim. Liability is only extended to a PEO in cases of fraud or knowledge of an improper claim. The bill also ensures that aggregate payroll tax credit filings are not delayed due to problems with a single claim, expediting the process for small businesses.
“This liability bill not only provides clarity for PEOs and their clients, it will also save the government billions of dollars by deterring tax fraud and discouraging improper claims,” said NAPEO President and CEO Casey Clark. “Thanks to Reps. Van Duyne and Thompson, PEOs can better serve American businesses and we can all rest assured that future tax credits will go to the businesses they were intended to help.”
NAPEO is working to ensure the legislation is included in the tax reform proposal being debated in Congress.
About NAPEO
The National Association of Professional Employer Organizations (NAPEO) is The Voice of the PEO Industry TM. NAPEO’s 181 PEO members provide payroll, benefits, workers’ comp, regulatory compliance assistance and other HR services to hundreds of thousands of small and mid-size businesses. Our members represent more than $372 billion in revenue. An additional 175 companies that provide services to PEOs are associate members of NAPEO. For more information, please visit www.napeo.org.