Creating the Iowa job training tax credit program and including applicability provisions

This bill creates a job training tax credit program (program) administered by the economic development authority (EDA) in consultation with the department of revenue (DOR) to provide tax credits to businesses that employ for pay qualified trainees in Iowa during the tax year. To qualify as a “qualified trainee” under the program, a person must be an apprentice or an intern, must be employed by a business in Iowa, and must satisfy the relevant minimum training standard. office of apprenticeship. “Intern” is defined in the bill to mean an Iowa college student, or a student who graduated from high school in Iowa but who now attends college outside of Iowa, who is engaged in temporary employment that focuses on providing the student with work experience in the student’s field of study. EDA is required to establish by rule minimum training standards that will reflect the minimum training necessary to provide a meaningful work experience for an intern or to learn a trade or job position for an apprentice. The bill describes how the minimum training standards should be quantified, as well as the factors EDA shall consider and the persons with whom EDA may consult in determining the standards. The bill provides that EDA may establish more than one minimum training standard. authority, and the bill describes the required information that must be contained in an application. EDA is required to review applications and, upon determining that the requirements of the program have been satisfied, issue a tax credit to the business. The tax credit equals $1,000 for each qualified trainee employed in Iowa by a business for the entire tax year. If a qualified trainee was not employed by the business for the entire tax year, the amount of the credit is prorated based upon the number of months of employment. The tax credit may be claimed against the individual and corporate income taxes, the franchise tax, the insurance companies tax, and the moneys and credits tax. The tax credit is nonrefundable and nontransferable, but any excess may be carried forward for seven years. The bill requires EDA and DOR to adopt rules as necessary for the implementation of the bill, and requires EDA and DOR to publish and submit annual reports to the governor and general assembly containing information as described in the bill. The bill applies to tax years beginning on or after January 1, 2022, and to qualified trainees employed in Iowa on or after that date.