HB437 By Representatives Whorton (R), Ledbetter, Hanes, Whorton (I), Greer, Williams (JD), Standridge, Sells, Ainsworth, Shedd, Collins, Nordgren, Harbison, Daniels, Henry, Patterson, Wood and McCutcheon RFD Ways and Means Education Rd 1 09-APR-15

SYNOPSIS: Under existing law, an income tax credit is not provided for an employer that employs an apprentice.

This bill would provide an income tax credit for an employer that employs an apprentice.

A BILL TO BE ENTITLED AN ACT

Relating to tax credit; to provide definitions; and to provide a tax credit for an employer that employs an apprentice.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:

Section 1. This act may be cited as the Thompson Apprenticeship Tax Credit Act of 2015.

Section 2. As used in this act, the following terms shall have the following meanings:

(1) APPRENTICE. A worker at least 16 years of age, except where a higher minimum age standard is otherwise fixed by law, who is employed to learn an apprenticeable occupation as provided in 29 C.F.R. Part 29.4.

(2) APPRENTICESHIP AGREEMENT. A written agreement, complying with 29 C.F.R. Part 29.2 between an apprentice and either the apprentice's program sponsor, or an apprenticeship committee acting as agent for the program sponsors, which contains the terms and conditions of the employment and training of the apprentice.

(3) ELIGIBLE EMPLOYER. A taxpayer who employs an apprentice pursuant to an apprentice agreement registered with the Office of Apprenticeship of the Employment and Training Administration of the United States Department of Labor.

Section 3. (a) An Alabama income tax credit is hereby established for eligible employers that employ an apprentice for at least seven full months of the taxable year. The credit shall equal one thousand dollars ($1,000) for each apprentice employed. The credit shall not be available for an individual apprentice for more than four taxable years.

(b) The credit shall be allowed against the tax imposed by Chapter 18 of Title 40 of the Code of Alabama 1975. This tax credit shall not be allowed to decrease a taxpayer's tax liability to less than zero. The credit is not refundable or transferable. The credit shall be available, on a pro rata basis, to the owners of qualified employers that are entities taxed under subchapters S or K of the Internal Revenue Code. An employer applying for a tax credit must apply each year to receive the credit for the preceding calendar year.

(c) If an employer employs an apprentice for less than the full preceding calendar year, the employer may apply for the credit on a pro rata monthly basis beginning on the first day of the first full month of apprenticeship.

Section 4. (a) The Alabama Industrial Development Training (AIDT) agency shall be given authority to promulgate any rules and regulations necessary to establish standards for participation and eligibility, and to implement and administer this section. The department shall consult with the Department of Revenue and the Department of Commerce to coordinate their efforts.

(b) The Department of Revenue shall prescribe a form to claim this credit that provides information to the department sufficient for the proper administration of this credit.

Section 5. The income tax credit pursuant to this act shall be effective January 1, 2016, for the 2016 taxable year and subsequent taxable years thereafter.

Section 6. This act shall become effective immediately following its passage and approval by the Governor, or its otherwise becoming law.

Taxation

Tax Credits

Employers

Popular Names

Apprentice

Revenue Department

Alabama Industrial Development Training