To amend sections 5747.98 and 5751.98 and to enact sections 3333.51, 5747.81, 5747.82, 5751.54, and 5751.55 of the Revised Code to grant tax credits to businesses that provide internships to students attending Ohio's colleges and universities and that hire former interns.

Section 1.  That sections 5747.98 and 5751.98 be amended and sections 3333.51, 5747.81, 5747.82, 5751.54, and 5751.55 of the Revised Code be enacted to read as follows:

Sec. 3333.51. (A) As used in this section, "Ohio institution of higher education" means all of the following:

(1) An institution of higher education, as defined in section 3345.12 of the Revised Code;

(2) An institution authorized by the Ohio board of regents under Chapter 1713. of the Revised Code to grant degrees and that is accredited by the appropriate regional, and, when appropriate, professional, accrediting associations within whose jurisdiction it falls;

(3) Private career schools holding program authorizations issued by the state board of career colleges and schools under division (C) of section 3332.05 of the Revised Code;

(4) Private institutions exempt from regulation under Chapter 3332. of the Revised Code as prescribed in section 3333.046 of the Revised Code.

(B) For the purpose of providing students in Ohio institutions of higher education with practical work experience and for the purpose of fostering long-term relationships between those students and Ohio employers, the Ohio board of regents may certify internships to be conducted between Ohio businesses and students attending Ohio institutions of higher education. The board shall adopt rules establishing criteria for certifying those internships. The rules shall condition certification of an internship on the internship being at least ten consecutive weeks in duration, with each week consisting of at least twenty hours of employment, and the intern receiving from the business total compensation equal to or exceeding two thousand dollars. The rules also shall require that the terms and conditions of an internship between a business and a student be memorialized in a written agreement between the two parties. An agreement shall, at a minimum, include:

(1) Biographical information on the student, including, but not limited to, the student's Ohio institution of higher education, date of birth, major, and expected date of graduation;

(2) A description of the business, including, but not limited to, the business' location, number of Ohio employees, and business activities;

(3) A description of the terms and conditions of the internship, including, but not limited to, a description of the tasks that the student is expected to complete; the amount of compensation to be paid to the student, which shall total at least two thousand dollars; the duration of the internship; and the hours of employment, which shall satisfy the minimum duration and hour requirements specified in this section;

(4) An agreement on the part of both the business and the student to evaluate the internship at the conclusion of the internship and periodically during the term of the internship.

Both the student and a representative of the business shall sign the agreement.

(C) Upon application, the Ohio board of regents shall issue a tax credit certificate to a business that participates in an internship certified by the board that the business successfully completes pursuant to the agreement entered into under this section. The tax credit certificate entitles the business to claim the tax credit allowed under section 5747.81 or 5751.54 of the Revised Code, provided that all the terms and conditions prescribed under this section and those sections for receiving the credit are satisfied. The application shall be in a form prescribed by the board and shall include a copy of the agreement entered into under this section.

Sec. 5747.81. (A) As used in this section:

(1) "Pass-through entity" includes a sole proprietorship.

(2) "State-certified internship" means an internship certified by the Ohio board of regents under section 3333.51 of the Revised Code.

(B) For taxable years beginning in 2007 or thereafter, there is hereby allowed a refundable credit against the tax imposed by section 5747.02 of the Revised Code for a taxpayer that is an equity investor in a pass-through entity that obtains a tax credit certificate issued by the Ohio board of regents under section 3333.51 of the Revised Code for completing a state-certified internship. The amount of the credit shall equal the taxpayer's distributive or proportionate share of five hundred dollars for each tax credit certificate issued to the pass-through entity during the taxable year. A taxpayer shall not be entitled to claim the credit allowed under this section unless the pass-through entity in which the taxpayer is an equity investor has obtained the tax credit certificate. The credit shall be claimed for the taxable year in which the certificate was issued and in the order required under section 5747.98 of the Revised Code.

(C) The tax commissioner may require that a taxpayer furnish information as is necessary to support a claim for a credit under this section, including, but not limited to, a copy of the tax credit certificate issued by the Ohio board of regents under section 3333.51 of the Revised Code and a copy of the internship agreement entered into under that section. No credit shall be allowed unless the information required by the commissioner is provided.

(D) A taxpayer that claims the credit allowed under this section shall not claim the credit allowed under section 5751.54 of the Revised Code.

Sec. 5747.82. (A) As used in this section:

(1) "Full-time employment position" means a position of employment for consideration for at least thirty-five hours per week, or the rendering of any other standard of service generally accepted by custom or specified by contract as full-time employment.

(2) "Pass-through entity" includes a sole proprietorship.

(3) "State-certified internship" means an internship certified by the Ohio board of regents under section 3333.51 of the Revised Code.

(B) There is hereby allowed a refundable credit against the tax imposed by section 5747.02 of the Revised Code for a taxpayer that is an equity investor in a pass-through entity that employs in a full-time employment position for thirty-six consecutive months a person whom the pass-through entity formerly employed as an intern under a state-certified internship. The credit may be claimed for each of the first two taxable years immediately following the thirty-six consecutive months during which the former intern was employed by the pass-through entity in a full-time employment position. If the former intern was employed by the pass-through entity for less than thirty-six consecutive months, a taxpayer may claim the credit allowed under this section only if the former intern voluntarily terminated employment or was terminated by the pass-through entity for cause. The amount of the credit shall equal one thousand dollars for each of the two taxable years for each former intern employed in a full-time employment position. A taxpayer shall claim the taxpayer's proportionate or distributive share of the credit. The credit shall be claimed in the order required under section 5747.98 of the Revised Code.

(C) A taxpayer that claims the credit allowed under this section shall not claim the credit allowed under section 5751.55 of the Revised Code.

Sec. 5747.98.  (A) To provide a uniform procedure for calculating the amount of tax due under section 5747.02 of the Revised Code, a taxpayer shall claim any credits to which the taxpayer is entitled in the following order:

(1) The retirement income credit under division (B) of section 5747.055 of the Revised Code;

(2) The senior citizen credit under division (C) of section 5747.05 of the Revised Code;

(3) The lump sum distribution credit under division (D) of section 5747.05 of the Revised Code;

(4) The dependent care credit under section 5747.054 of the Revised Code;

(5) The lump sum retirement income credit under division (C) of section 5747.055 of the Revised Code;

(6) The lump sum retirement income credit under division (D) of section 5747.055 of the Revised Code;

(7) The lump sum retirement income credit under division (E) of section 5747.055 of the Revised Code;

(8) The low-income credit under section 5747.056 of the Revised Code;

(9) The credit for displaced workers who pay for job training under section 5747.27 of the Revised Code;

(10) The campaign contribution credit under section 5747.29 of the Revised Code;

(11) The twenty-dollar personal exemption credit under section 5747.022 of the Revised Code;

(12) The joint filing credit under division (G) of section 5747.05 of the Revised Code;

(13) The nonresident credit under division (A) of section 5747.05 of the Revised Code;

(14) The credit for a resident's out-of-state income under division (B) of section 5747.05 of the Revised Code;

(15) The credit for employers that enter into agreements with child day-care centers under section 5747.34 of the Revised Code;

(16) The credit for employers that reimburse employee child care expenses under section 5747.36 of the Revised Code;

(17) The credit for adoption of a minor child under section 5747.37 of the Revised Code;

(18) The credit for purchases of lights and reflectors under section 5747.38 of the Revised Code;

(19) The job retention credit under division (B) of section 5747.058 of the Revised Code;

(20) The credit for purchases of new manufacturing machinery and equipment under section 5747.26 or section 5747.261 of the Revised Code;

(21) The second credit for purchases of new manufacturing machinery and equipment and the credit for using Ohio coal under section 5747.31 of the Revised Code;

(22) The job training credit under section 5747.39 of the Revised Code;

(23) The enterprise zone credit under section 5709.66 of the Revised Code;

(24) The credit for the eligible costs associated with a voluntary action under section 5747.32 of the Revised Code;

(25) The credit for employers that establish on-site child day-care centers under section 5747.35 of the Revised Code;

(26) The ethanol plant investment credit under section 5747.75 of the Revised Code;

(27) The credit for purchases of qualifying grape production property under section 5747.28 of the Revised Code;

(28) The export sales credit under section 5747.057 of the Revised Code;

(29) The credit for research and development and technology transfer investors under section 5747.33 of the Revised Code;

(30) The enterprise zone credits under section 5709.65 of the Revised Code;

(31) The research and development credit under section 5747.331 of the Revised Code;

(32) The refundable credit for rehabilitating a historic building under section 5747.76 of the Revised Code;

(33) The refundable jobs creation credit under division (A) of section 5747.058 of the Revised Code;

(34) The refundable credit for taxes paid by a qualifying entity granted under section 5747.059 of the Revised Code;

(35) The refundable credits for taxes paid by a qualifying pass-through entity granted under division (J) of section 5747.08 of the Revised Code;

(36) The refundable credit for tax withheld under division (B)(1) of section 5747.062 of the Revised Code;

(37) The refundable credit under section 5747.80 of the Revised Code for losses on loans made to the Ohio venture capital program under sections 150.01 to 150.10 of the Revised Code;

(38) The refundable credit for a state-certified internship under section 5747.81 of the Revised Code;

(39) The refundable credit for employing former interns under section 5747.82 of the Revised Code.

(B) For any credit, except the credits enumerated in divisions (A)(32) to (37)(39) of this section and the credit granted under division (I) of section 5747.08 of the Revised Code, the amount of the credit for a taxable year shall not exceed the tax due after allowing for any other credit that precedes it in the order required under this section. Any excess amount of a particular credit may be carried forward if authorized under the section creating that credit. Nothing in this chapter shall be construed to allow a taxpayer to claim, directly or indirectly, a credit more than once for a taxable year.

Sec. 5751.54. (A) As used in this section, "state-certified internship" means an internship certified by the Ohio board of regents under section 3333.51 of the Revised Code.

(B) For tax periods beginning on or after January 1, 2008, a refundable credit may be claimed under this chapter by a taxpayer that obtains a tax credit certificate issued by the Ohio board of regents under section 3333.51 of the Revised Code for completing a state-certified internship. The amount of the credit shall equal five hundred dollars for each tax credit certificate issued to the taxpayer during the calendar year. A taxpayer shall not be entitled to claim the credit allowed under this section unless the taxpayer has obtained the tax credit certificate. The credit shall be claimed for the calendar year in which the certificate was issued and in the order required under section 5751.98 of the Revised Code.

(C) The tax commissioner may require that a taxpayer furnish information as is necessary to support a claim for a credit under this section, including, but not limited to, a copy of the tax credit certificate issued by the Ohio board of regents under section 3333.51 of the Revised Code and a copy of the internship agreement entered into under that section. No credit shall be allowed unless the information required by the commissioner is provided.

(D) Equity investors in a taxpayer that claims the credit allowed under this section shall not claim the credit allowed under section 5747.81 of the Revised Code.

Sec. 5751.55. (A) As used in this section:

(1) "Full-time employment position" means a position of employment for consideration for at least thirty-five hours per week, or the rendering of any other standard of service generally accepted by custom or specified by contract as full-time employment.

(2) "State-certified internship" means an internship certified by the Ohio board of regents under section 3333.51 of the Revised Code.

(B) A refundable credit may be claimed under this chapter by a taxpayer that, during the calendar year immediately preceding the tax period, employed in a full-time employment position for thirty-six consecutive months a person whom the taxpayer formerly employed as an intern under a state-certified internship. The credit may be claimed for each of the first two tax periods immediately following the thirty-six consecutive months during which the former intern was employed by the taxpayer in a full-time employment position. If the former intern was employed by the taxpayer for less than thirty-six consecutive months, a taxpayer may claim the credit allowed under this section only if the former intern voluntarily terminated employment or was terminated by the taxpayer for cause. The amount of the credit shall equal one thousand dollars for each of the two tax periods for each former intern employed in a full-time employment position. The credit shall be claimed in the order required under section 5751.98 of the Revised Code.

(C) Equity investors in a taxpayer that claims the credit allowed under this section shall not claim the credit allowed under section 5747.82 of the Revised Code.

Sec. 5751.98.  (A) To provide a uniform procedure for calculating the amount of tax due under this chapter, a taxpayer shall claim any credits to which it is entitled in the following order:

(1) The nonrefundable jobs retention credit under division (B) of section 5751.50 of the Revised Code;

(2) The nonrefundable credit for qualified research expenses under division (B) of section 5751.51 of the Revised Code;

(3) The nonrefundable credit for a borrower's qualified research and development loan payments under division (B) of section 5751.52 of the Revised Code;

(4) The nonrefundable credit for calendar years 2010 to 2029 for unused net operating losses under division (B) of section 5751.53 of the Revised Code;

(5) The refundable credit for calendar year 2030 for unused net operating losses under division (C) of section 5751.53 of the Revised Code;

(6) The refundable jobs creation credit under division (A) of section 5751.50 of the Revised Code;

(7) The refundable credit for a state-certified internship under section 5751.54 of the Revised Code;

(8) The refundable credit for employing former interns under section 5751.55 of the Revised Code.

(B) For any credit except the credit credits enumerated in division divisions (A)(4)(5) to (8) of this section, the amount of the credit for a tax period shall not exceed the tax due after allowing for any other credit that precedes it in the order required under this section. Any excess amount of a particular credit may be carried forward if authorized under the section creating the credit.

Section 2.  That existing sections 5747.98 and 5751.98 of the Revised Code are hereby repealed.