LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
200 W. Washington St., Suite 301
Indianapolis, IN 46204
(317) 233-0696
iga.in.gov
FISCAL IMPACT STATEMENT
LS 7017 NOTE PREPARED: Jan 7, 2024
BILL NUMBER: HB 1236 BILL AMENDED:
SUBJECT: Apprenticeship Tax Credit.
FIRST AUTHOR: Rep. Goodrich BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State
DEDICATED
FEDERAL
Summary of Legislation: The bill provides for an apprenticeship tax credit (credit) for an eligible employer.
It provides that the amount of the credit is equal to 50% of qualified expenses attributable to the
establishment of an apprenticeship program. The bill provides maximum amounts of the credit: (1) in a
taxable year; and (2) in aggregate. It provides that the total amount of credits that may be awarded for a state
fiscal year may not exceed $10 M.
Effective Date: January 1, 2025.
Explanation of State Expenditures: Department of State Revenue (DOR): The DOR will incur additional
expenses to revise tax forms, instructions, and computer programs to reflect the changes made by the bill.
The DOR would also be required to provide required information about the credit on their website. The
DOR's current level of resources should be sufficient to implement these changes.
Explanation of State Revenues: The bill creates a new nonrefundable tax credit for employers who employ
an apprentice. The bill would reduce state General Fund revenues by an estimated $10 M per year beginning
in FY 2026. The number of registered apprentices and youth apprentices in the state is large enough that the
credit cap of $10 M could be reached annually. The tax credit will be available beginning in tax year 2025,
which will impact tax income tax revenues in FY 2026.
Additional Information - An employer could claim a credit of 50% of the qualified expenses incurred by the
taxpayer up to $5,000 per apprentice in a taxable year, up to a maximum of $250,000 in aggregate per
employer. Employers will receive the credit based on the chronological order of when they filed for the credit
until the maximum amount allowable in a state fiscal year is reached. The credit may be applied to tax
HB 1236 1 liabilities for Adjusted Gross Income (AGI) Tax and the Financial Institutions Tax. An employer may claim
the credit for two taxable years and may carry forward the credit for up to three taxable years.
The bill defines an apprentice as a worker who is at least 16 years of age and is employed to learn an
apprenticeable occupation that is in a high demand field and for which the average rate of pay is above the
state median wage. There were 18,552 registered apprentices in the state in federal fiscal year 2021; 8,207
were new apprentices.
Explanation of Local Expenditures:
Explanation of Local Revenues:
State Agencies Affected: Department of State Revenue.
Local Agencies Affected:
Information Sources: Department of Workforce Development; Office of Work-Based Learning and
Apprenticeship. Department of Workforce Development. “What is Apprenticeship.”
https://www.in.gov/dwd/owbla/apprenticeship/; U.S. Department of Labor Employment and Training
Administration. “Registered Apprenticeship National Results Fiscal Year 2021, 10/01/2020 to 9/30/2021.”
https://www.dol.gov/agencies/eta/apprenticeship/about/statistics/2021
Fiscal Analyst: Camille Tesch, 317-232-5293.
HB 1236 2