Introduced Version
HOUSE BILL No. 1236
_____
DIGEST OF INTRODUCED BILL
Citations Affected: IC 6-3.1-42.
Synopsis: Apprenticeship tax credit. Provides for an apprenticeship
tax credit (credit) for an eligible employer. Provides that the amount of
the credit is equal to 50% of qualified expenses attributable to the
establishment of an apprenticeship program. Provides maximum
amounts of the credit: (1) in a taxable year; and (2) in aggregate.
Provides that the total amount of credits that may be awarded for a state
fiscal year may not exceed $10,000,000.
Effective: January 1, 2025.
Goodrich, Judy, Heine
January 9, 2024, read first time and referred to Committee on Ways and Means.
2024 IN 1236—LS 7017/DI 125 Introduced
Second Regular Session of the 123rd General Assembly (2024)
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HOUSE BILL No. 1236
A BILL FOR AN ACT to amend the Indiana Code concerning
taxation.
Be it enacted by the General Assembly of the State of Indiana:
1 SECTION 1. IC 6-3.1-42 IS ADDED TO THE INDIANA CODE
2 AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE
3 JANUARY 1, 2025]:
4 Chapter 42. Apprenticeship Tax Credit
5 Sec. 1.As used in this chapter, "apprentice" means a worker
6 who is:
7 (1) at least sixteen (16) years of age, except where a higher
8 minimum age standard is otherwise fixed by law; and
9 (2) employed to learn an apprenticeable occupation that is in
10 a high demand field and for which the average rate of pay is
11 above the state median wage.
12 Sec. 2. As used in this chapter, "eligible employer" means a
13 person, corporation, limited liability company, partnership, or
14 other entity.
15 Sec. 3. As used in this chapter, "qualified expenses" means
16 expenses incurred by an elgible employer that are directly related
17 to the employer establishing an apprenticeship program for the
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1 hiring of apprentices.
2 Sec. 4. As used in this chapter, "state tax liability" means a
3 taxpayer's total tax liability that is incurred under:
4 (1) IC 6-3-1 through IC 6-3-7 (the adjusted gross income tax);
5 and
6 (2) IC 6-5.5 (the financial institutions tax);
7 as computed after the application of the credits that under
8 IC 6-3.1-1-2 are to be applied before the credit provided by this
9 chapter.
10 Sec. 5. As used in this chapter, "taxpayer" means an eligible
11 employer that has state tax liability.
12 Sec. 6. A taxpayer that employs an apprentice for least six (6)
13 full months in a taxable year through an apprenticeship program
14 established by the taxpayer is entitled to a credit against the
15 taxpayer's state tax liability in the taxable year in which the
16 taxpayer employs the apprentice. Except as provided in section 9
17 of this chapter, a taxpayer may not claim a credit under this
18 chapter in more than two (2) taxable years.
19 Sec. 7. Subject to section 9 of this chapter, the amount of the
20 credit is an amount equal to:
21 (1) fifty percent (50%) of qualified expenses incurred during
22 a taxable year beginning after December 31, 2024, by the
23 taxpayer; multiplied by
24 (2) the number of apprentices employed through the
25 apprenticeship program in the taxable year.
26 Sec. 8. (a) The maximum amount of the credit provided under
27 this chapter attributable to employment of a particular individual
28 apprentice in a taxable year may not exceed five thousand dollars
29 ($5,000).
30 (b) The maximum amount of aggregate credits provided to a
31 taxpayer under this chapter may not exceed a total of two hundred
32 fifty thousand dollars ($250,000).
33 Sec. 9. (a) If the amount of the credit determined under section
34 7 of this chapter for a taxpayer in a taxable year exceeds the
35 taxpayer's state tax liability for that taxable year, the taxpayer
36 may carry the excess credit over for a period not to exceed the
37 eligible taxpayer's following three (3) taxable years. The amount
38 of the credit carryover from a taxable year shall be reduced to the
39 extent that the carryover is used by the taxpayer to obtain a credit
40 under this chapter for any subsequent taxable year. A taxpayer is
41 not entitled to a carryback or a refund of any unused credit
42 amount.
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1 (b) A taxpayer may not assign any part of a credit to which the
2 taxpayer is entitled under this chapter.
3 Sec. 10. If a pass through entity is entitled to a credit under
4 section 6 of this chapter but does not have state tax liability against
5 which the tax credit may be applied, a shareholder, partner, or
6 member of the pass through entity is entitled to a tax credit equal
7 to:
8 (1) the tax credit determined for the pass through entity for
9 the taxable year; multiplied by
10 (2) the percentage of the pass through entity's distributive
11 income to which the shareholder, partner, or member is
12 entitled.
13 Sec. 11. To apply a credit against the taxpayer's state tax
14 liability, a taxpayer must claim the credit on the taxpayer's annual
15 state tax return or returns in the manner prescribed by the
16 department. The taxpayer shall submit to the department the
17 information that the department determines is necessary for the
18 department to determine whether the taxpayer is eligible for the
19 credit.
20 Sec. 12. (a) The total amount of credits that may be awarded
21 under this chapter for a state fiscal year may not exceed ten million
22 dollars ($10,000,000).
23 (b) The department shall record the time of filing of each claim
24 for a credit under this chapter and shall approve the credits, if they
25 otherwise qualify, in the chronological order in which the claims
26 for the credit are filed in the state fiscal year.
27 (c) When the total credits approved under this section equal the
28 maximum amount allowable in a state fiscal year, no credit claimed
29 in that same state fiscal year shall be allowed.
30 Sec. 13. The department, on a website used by the department
31 to provide information to the public, shall provide the following
32 information:
33 (1) The application for the credit provided in this chapter.
34 (2) A timeline for receiving the credit provided in this chapter.
35 (3) The total amount of credits awarded under this chapter
36 during the current state fiscal year.
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