88R11832 RDS-D
By: Guillen H.B. No. 3785
A BILL TO BE ENTITLED
AN ACT
relating to a franchise tax credit for taxable entities that employ
certain apprentices.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Chapter 171, Tax Code, is amended by adding
Subchapter K to read as follows:
SUBCHAPTER K. TAX CREDIT FOR EMPLOYMENT OF APPRENTICES
Sec. 171.551. DEFINITION. In this subchapter, "qualifying
apprentice" means an individual who is employed by a taxable
entity:
(1) for the purpose of learning a vocational trade;
(2) as an apprentice; or
(3) while enrolled in a work-based learning program.
Sec. 171.552. ENTITLEMENT TO CREDIT. A taxable entity is
entitled to a credit in the amount and under the conditions provided
by this subchapter against the tax imposed under this chapter.
Sec. 171.553. QUALIFICATION; CERTIFICATE OF ELIGIBILITY.
(a) A taxable entity qualifies for a credit under this subchapter
if, during the period for which the credit is claimed, the entity
employs at least one qualifying apprentice.
(b) Before claiming a credit under this subchapter, a
taxable entity must request a certificate of eligibility from the
Texas Workforce Commission or the Office of Apprenticeship of the
United States Department of Labor stating that the entity employed
at least one qualifying apprentice during the period for which the
credit is claimed.
Sec. 171.554. AMOUNT OF CREDIT; LIMITATION. (a) Subject to
Subsection (b), the amount of the credit a taxable entity may claim
on a report is an amount equal to the lesser of:
(1) the sum of the following amounts:
(A) $2,000 multiplied by the number of qualifying
apprentices employed by the entity during the period covered by the
report that are at least 16 years of age but younger than 18 years of
age;
(B) $4,000 multiplied by the number of qualifying
apprentices employed by the entity during the period covered by the
report that are at least 18 years of age and are not described by
Paragraph (C); and
(C) $6,000 multiplied by the number of qualifying
apprentices employed by the entity during the period covered by the
report that are at least 18 years of age and are veterans of the
United States armed services or the Texas military forces; or
(2) $100,000.
(b) The total credit claimed on a report may not exceed the
amount of franchise tax due for the report after the application of
any other applicable credits.
Sec. 171.555. APPLICATION FOR CREDIT. (a) A taxable entity
must apply for a credit under this subchapter on or with the report
for the period for which the credit is claimed.
(b) The comptroller shall promulgate a form for the
application for the credit. A taxable entity must use the form in
applying for the credit and must include with the application any
certificates received from the Texas Workforce Commission or the
Office of Apprenticeship of the United States Department of Labor
during the period for which the credit is claimed.
(c) The comptroller may require a taxable entity to submit
with an application any other information the comptroller
determines is necessary to determine whether the entity qualifies
for the credit under Section 171.553.
Sec. 171.556. CARRYFORWARD. (a) If a taxable entity is
eligible for a credit that exceeds the limitation under Section
171.554(b), the entity may carry the unused credit forward for up to
two consecutive reports.
(b) A carryforward is considered the remaining portion of a
credit that cannot be claimed in the current year because of the
limitation under Section 171.554(b).
(c) Credits, including a carryforward, are considered to be
used in the following order:
(1) a carryforward under this subchapter; and
(2) a current year credit.
Sec. 171.557. RULES. The comptroller shall adopt rules
necessary to implement and administer this subchapter.
SECTION 2. Subchapter K, Chapter 171, Tax Code, as added by
this Act, applies only to a report originally due on or after
January 1, 2024.
SECTION 3. This Act takes effect January 1, 2024.