September 22, 2016, Introduced by Reps. Driskell, Townsend, Love, Hovey-Wright, Chang, LaVoy, Liberati, Lucido, Hoadley, Lane, LaGrand, Chirkun, Darany and Pagan and referred to the Committee on Tax Policy.
A bill to amend 1967 PA 281, entitled
"Income tax act of 1967,"
(MCL 206.1 to 206.713) by adding section 675.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 675. (1) For tax years beginning on and after January 1,
2017, a taxpayer may claim a credit against the tax imposed by this
part equal to the sum of 50% of the qualified expenses defined in
subsection (5)(d)(i) and (ii) and 100% of the qualified expenses
defined in subsection (5)(d)(iii) paid by the taxpayer in the tax
year in each of the following circumstances:
(a) Except for apprentices trained under subdivision (b), an
amount not to exceed $2,000.00 for each apprentice trained by the
taxpayer in the tax year.
(b) For companies that have a classification under the North
American Industry Classification System (NAICS) of 333511, 333512,
333513, 333514, or 333515, an amount not to exceed $4,000.00 for
each apprentice trained by the taxpayer in the tax year.
(2) If the credit allowed under this section exceeds the tax
liability of the taxpayer under this act for the tax year, that
portion of the credit that exceeds the tax liability shall be
refunded.
(3) The credit allowed under this section shall be claimed on
the annual return required under section 685, or for a taxpayer
that is not required to file an annual return, the department shall
provide that the credit under this section may be claimed on a form
prescribed by the department for persons not required to file an
annual return.
(4) For each year that this credit is in effect, the
department of talent and economic development shall prepare a
report containing information including, but not limited to, the
number of companies taking advantage of the apprenticeship credit,
the number of apprentices participating in the program, the number
of apprentices who complete a program the costs of which were the
basis of a credit under this section, the number of apprentices
that were hired by the taxpayer after the apprenticeship training
was completed for which the taxpayer claimed a credit under this
section for the costs of training that apprentice, information on
the employment status of individuals who have completed an
apprenticeship to the extent the information is available, and the
fiscal impact of the apprenticeship credit. This report shall then
be transmitted to the house tax policy and senate finance
committees and to the house and senate appropriations committees.
This report shall be due no later than the first day of March each
year.
(5) As used in this section:
(a) "Apprentice" means a person who is a resident of this
state, is 16 years of age or older, has not obtained a high school
diploma, is enrolled in high school or a high school equivalency
test preparation program, as defined in section 4 of the state
school aid act of 1979, 1979 PA 94, MCL 388.1604, and is trained by
a taxpayer through a program that meets all of the following
criteria:
(i) The program is registered with the Bureau of
Apprenticeship and Training of the United States Department of
Labor.
(ii) The program is provided pursuant to an apprenticeship
agreement signed by the taxpayer and the apprentice.
(iii) The program is filed with a local workforce development
board.
(iv) The minimum term in hours for the program shall be not
less than 4,000 hours.
(b) "Enrolled" means currently enrolled or expecting to enroll
after a period of less than 3 months during which the program is
not in operation and the apprentice is not enrolled.
(c) "Local workforce development board" means a board
authorized under the workforce investment act in 29 USC 2832 that
has the responsibility to ensure that the workforce needs of the
employers in the geographic area governed by the local unit of
government are met.
(d) "Qualified expenses" means all of the following expenses
paid by the taxpayer in a tax year that begins after December 31,
2016 that were not paid for with funds the taxpayer received or
retained, that the taxpayer would not otherwise have received or
retained, and that are used for training an apprentice:
(i) Salary and wages paid to an apprentice.
(ii) Fringe benefits and other payroll expenses paid for the
benefit of an apprentice.
(iii) Costs of classroom instruction and related expenses
identified as costs for which the taxpayer is responsible under an
apprenticeship agreement, including, but not limited to, tuition,
fees, and books for college-level courses taken while the
apprentice is enrolled in high school.