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53	53	STATE OF OKLAHOMA
54	54
55	55	1st Session of the 60th Legislature (2025)
56	56
57	57	SENATE BILL 296 By: Pugh
58	58
59	59
60	60
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63	63	AS INTRODUCED
64	64
65	65	An Act relating to income tax; amending 68 O.S. 2021,
66	66	Section 2357.301, as amended by Section 1, Chapter
67	67	313, O.S.L. 2024 (68 O.S. Supp. 20 24, Section
68	68	2357.301), which relates to definitions; defining
69	69	term; amending 68 O.S. 2021, Sections 2357.303 and
70	70	2357.304, as amended by Section 2, Chapter 313,
71	71	O.S.L. 2024 (68 O.S. Supp. 2024, Section 2357.304) ,
72	72	which relate to credit for qualified employ ers and
73	73	qualified employees; expanding credit to include
74	74	instructor pilots; an d providing an effective date .
75	75
76	76
77	77
78	78
79	79	BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
80	80	SECTION 1. AMENDATORY 68 O.S. 2021, Section 2357.301, a s
81	81	amended by Section 1, Chapter 313, O.S.L. 2024 (68 O.S. Supp. 2024,
82	82	Section 2357.301), is amended to read as follows:
83	83	Section 2357.301. As used in Sections 2357.301 through 2357.304
84	84	of this title:
85	85	1. “Aerospace sector” means a private or public organiz ation
86	86	located in this state and engaged in the manufacture of aerospace or
87	87	defense hardware or software, aerospace maintenance, aerospace
88	88	repair and overhaul, supply of parts to the aerospace industry,
89	89	provision of services and support relating to the aero space
90	90
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141	141	industry, research and development of aerospace technology and
142	142	systems and the education and training of aerospace personnel;
143	143	2. “Compensation” means payments in the form of contract labor
144	144	for which the payor is required to provide a Form 1099 to th e person
145	145	paid, wages subject to withholding tax paid to a part -time employee
146	146	or full-time employee or salary or other remuneration. Compensation
147	147	shall not include employer -provided retirement, medical or health -
148	148	care benefits, reimbursement for travel, mea ls, lodging or any other
149	149	expense;
150	150	3. “Institution” means an institution within The Oklahoma State
151	151	System of Higher Education or any other public or private college or
152	152	university that is accredited by a national accrediting body;
153	153	4. “Instructor pilot” means any person who is licensed as a
154	154	Certified Flight Instructor by the Federal Aviation Administration
155	155	and is employed in this state in support of a contract with the
156	156	federal government to provide instruction either live or on a flight
157	157	simulator who was not employed as an instructor pilot in the
158	158	aerospace sector in this state immediately preceding employment or
159	159	contracting with a qualified employer . The definition shall not be
160	160	interpreted to exclude any person (1) who previously qualified and
161	161	established the credit against the tax imposed pursuant to Section
162	162	2355 of this title and be comes employed by a different qualified
163	163	employer, or (2) who establishes the credit against the tax imposed
164	164	pursuant to Section 2355 of this title for the first time and
165	165
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216	216	becomes employed by a different qualified employer in subsequent
217	217	years, provided a person in either case has not claimed the credit
218	218	for the lifetime maximum of five (5) years ;
219	219	5. “Qualified employer” means a sole proprietor, general
220	220	partnership, limited partnersh ip, limited liability company,
221	221	corporation, other legally recognized business entity or public
222	222	entity whose principal business activity involves the aerospace
223	223	sector;
224	224	5. 6. “Qualified employee” means any person, regardless of the
225	225	date of hire, employed in this state by or contracting in this state
226	226	with a qualified employer on or after January 1, 2009, who was not
227	227	employed in the aerospace sector in this state immediately preceding
228	228	employment or contracting with a qualified employer, and who has
229	229	been either:
230	230	a. awarded an undergraduate or graduate degree from a
231	231	qualified program by a n institution, or
232	232	b. licensed as a Professional Engineer by the State Board
233	233	of Licensure for Professional Engineers and Land
234	234	Surveyors pursuant to Section 475.15 of Title 59 of
235	235	the Oklahoma Statutes.
236	236	Provided, the definition shall not be interpreted to exclude any
237	237	person who was employed in the aerospace sector, but not as a full -
238	238	time engineer, prior to being awarded an undergraduate or graduate
239	239	degree from a qualified program by an institution or any person who
240	240
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291	291	has been awarded an undergraduate or graduate degree from a
292	292	qualified program by an institution and is employed by a
293	293	professional staffing company and assigned to work in the aerospace
294	294	sector in this state.
295	295	Beginning on or after January 1, 2024, the definition shall also
296	296	not be interpreted to exclude any person (1) who previously
297	297	qualified and established the credit against the tax imposed
298	298	pursuant to Section 2355 of this title and becomes employed by a
299	299	different qualified e mployer, or (2) who establishes the credit
300	300	against the tax imposed pursuant to Section 2355 of this title for
301	301	the first time and becomes employed by a different qualified
302	302	employer in subsequent years, provided a person in either case has
303	303	not claimed the credit for the lifetime maximum of five (5) years;
304	304	6. 7. “Qualified program” means a program at an institution
305	305	that includes a graduate or undergraduate program that has been
306	306	accredited by the Engineering Accreditation Commission of the
307	307	Accreditation Board for Engineering and Technology (ABET) and that
308	308	awards an undergraduate or grad uate degree. Both the undergraduate
309	309	and graduate programs of the same discipline of engineering at an
310	310	institution shall be part of the qualified program if either program
311	311	is ABET accredited; and
312	312	7. 8. “Tuition” means the average annual amount paid by a
313	313	qualified employee for enrollment and instruction in a qualified
314	314
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365	365	program. Tuition shall not include the cost of books, fees or room
366	366	and board.
367	367	SECTION 2. AMENDATORY 68 O.S. 2021, Section 2357.303, is
368	368	amended to read as follows:
369	369	Section 2357.303. A. Except as provided in subsection F of
370	370	this section, for taxable years beginning after December 31, 2008,
371	371	and ending before January 1, 2026, a qualified emplo yer shall be
372	372	allowed a credit against the tax imposed pursuant to Section 2355 of
373	373	this title for compensation paid to a qualified employee and, for
374	374	tax year 2025, an instructor pilot .
375	375	B. The credit authorized by subsection A of this section shall
376	376	be in the amount of:
377	377	1. Ten percent (10%) of the compensation paid for the first
378	378	through fifth years of employment in the aerospace sector if the
379	379	qualified employee graduated from an institution located in this
380	380	state; or
381	381	2. Five percent (5%) of the compensation paid for the first
382	382	through fifth years of employment in the aerospace sector if the
383	383	qualified employee graduated from an institution located outside
384	384	this state.
385	385	C. The credit authorized by this section shall not exceed
386	386	Twelve Thousand Five Hundred Dollars ($12,500.00) for each qualified
387	387	employee annually.
388	388
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439	439	D. The credit authorized by this section shall not be used to
440	440	reduce the tax liability of the qualified employer to less than zero
441	441	(0).
442	442	E. No credit authorized pursuant to this section shall be
443	443	claimed after the fifth year of employment.
444	444	F. No credit otherwise authorized by the provisions of this
445	445	section may be claimed for any event, transaction, investment,
446	446	expenditure or other act occurring on or after July 1, 2010, for
447	447	which the credit would otherwis e be allowable. The provisions of
448	448	this subsection shall cease to be operative on July 1, 2011.
449	449	Beginning July 1, 2011, the credit authorized by this section may be
450	450	claimed for any event, transaction, investment, expenditure or other
451	451	act occurring on or a fter July 1, 2011, according to the provisions
452	452	of this section.
453	453	SECTION 3. AMENDATORY 68 O.S. 2021, Section 2357.304, as
454	454	amended by Section 2, Chapter 313, O.S.L. 2024 (68 O.S. Supp. 2024,
455	455	Section 2357.304), is amended to read as follows:
456	456	Section 2357.304. A. Except as provided in subsection D of
457	457	this section, for taxable years beginning after December 31, 2008,
458	458	and ending before January 1, 2026, a qualified employee and, for tax
459	459	year 2025, an instructor pilot shall be allowed a credit against the
460	460	tax imposed pursuant to Section 2355 of this title of up to Five
461	461	Thousand Dollars ($5,000.00) per tax year for a period of time not
462	462
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513	513	to exceed five (5) years during the lifetime of the qualified
514	514	employee. This credit may be claimed in no nconsecutive tax years.
515	515	B. The credit authorized by this section shall not be used to
516	516	reduce the tax liability of the taxpayer to less than zero (0).
517	517	C. Any credit claimed, but not used, may be carried over, in
518	518	order, to each of the five (5) subsequent t axable years.
519	519	D. No credit otherwise authorized by the provisions of this
520	520	section may be claimed for any event, transaction, investment,
521	521	expenditure or other act occurring on or after July 1, 2010, for
522	522	which the credit would otherwise be allowable. The p rovisions of
523	523	this subsection shall cease to be operative on July 1, 2011.
524	524	Beginning July 1, 2011, the credit authorized by this section may be
525	525	claimed for any event, transaction, investment, expenditure or other
526	526	act occurring on or after July 1, 2011, acc ording to the provisions
527	527	of this section.
528	528	SECTION 4. This act shall become effective November 1, 2025.
529	529
530	530	60-1-1249 QD 12/30/2024 11:25:34 PM

Oklahoma 2025 Regular Session

Oklahoma Senate Bill SB296 Compare Versions