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S. B. No. 250 As IntroducedAs Introduced
127th General Assembly | Regular Session | 2007-2008 |
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Cosponsors:
Senators Niehaus, Gardner, Seitz, Schuring, Mumper, Austria, Harris, Padgett, Amstutz
A BILL
To amend sections 5725.31, 5729.07, 5733.42, and
5747.39 of the Revised Code to extend the job
training tax credit for an additional year.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 5725.31, 5729.07, 5733.42, and
5747.39 of the Revised Code be amended to read as follows:
Sec. 5725.31. (A) As used in this section:
(1)
"Eligible employee" and
"eligible training costs" have
the
same meanings as in section 5733.42 of the Revised Code.
(2)
"Tax assessed under this chapter" means,
in the case of
a
dealer in
intangibles, the tax assessed under sections 5725.13
to
5725.17 of the Revised Code and, in
the case of a domestic
insurance
company, the taxes assessed under sections 5725.18 to
5725.26 of the Revised Code.
(3)
"Taxpayer" means a dealer in
intangibles or a domestic
insurance company subject to a tax assessed
under this chapter.
(4)
"Credit period" means,
in the case of
a dealer in
intangibles, the calendar year ending on the thirty-first day
of
December next preceding the day the report is required
to be
returned under section 5725.14 of the Revised Code and, in
the
case of a domestic insurance company, the calendar year ending on
the
thirty-first day of December next preceding the day the
annual
statement is required to be returned under section 5725.18 or
5725.181 of the Revised Code.
(B) There is hereby allowed a nonrefundable credit against
the
tax imposed under this chapter for a taxpayer for which a tax
credit
certificate is issued under section 5733.42 of the Revised
Code.
The credit may be claimed for credit periods
beginning
on
or
after January 1,
2003, and ending on or before
December
31,
2007
2008. The amount of the credit
for the credit period
beginning on
January 1, 2003, shall equal one-half of
the
average
of the
eligible training costs paid
or incurred by the
taxpayer
during
calendar years
1998, 1999, and 2000,
not
to exceed one
thousand
dollars for each eligible
employee on
account of
whom
eligible
training costs were paid or
incurred by
the taxpayer.
The amount
of the credit for the credit period
beginning on January 1, 2004,
shall equal one-half of the average
of the eligible training costs
paid or incurred by the taxpayer
during calendar years 2002, 2003,
and 2004, not to exceed one
thousand dollars for each eligible
employee on account of whom
eligible training costs were paid or
incurred by the taxpayer.
The
amount of the credit for the credit
period beginning on
January 1,
2005, shall equal one-half of the
average of the
eligible training
costs paid or incurred by the
taxpayer during
calendar years 2003,
2004, and 2005, not to exceed
one thousand
dollars for each
eligible employee on account of whom
eligible
training costs were
paid or incurred by the taxpayer.
The
amount of the credit for the credit period beginning on January 1,
2006, shall equal one-half of the average of the eligible training
costs paid or incurred by the taxpayer during calendar years 2004,
2005, and 2006, not to exceed one thousand dollars for each
eligible employee on account of whom eligible training costs were
paid or incurred by the taxpayer. The amount of the credit for the
credit period beginning on January 1, 2007, shall equal one-half
of the average of the eligible training costs paid or incurred by
the taxpayer during calendar years 2005, 2006, and 2007, not to
exceed one thousand dollars for each eligible employee on account
of whom eligible training costs were paid or incurred by the
taxpayer. The amount of the credit for the credit period beginning
on January 1, 2008, shall equal one-half of the average of the
eligible training costs paid or incurred by the taxpayer during
calendar years 2006, 2007, and 2008, not to exceed one thousand
dollars for each eligible employee on account of whom eligible
training costs were paid or incurred by the taxpayer.
The
credit
claimed by a taxpayer
each
credit period shall not
exceed
one
hundred thousand dollars.
A taxpayer shall apply to the director of job and family
services
for a tax credit certificate in the manner prescribed by
division
(C) of section 5733.42 of the Revised Code. Divisions
(C)
to (H) of that section govern the tax credit allowed by this
section, except that
"credit period" shall be substituted for
"tax
year with
respect to a calendar
year" wherever that phrase appears
in those divisions and that a taxpayer
under this section shall be
considered a taxpayer for the purposes of that
section.
A taxpayer may carry forward the credit allowed under this
section
to the extent that the credit exceeds the taxpayer's tax
due for the
credit period. The taxpayer may carry the excess
credit forward for
three credit periods following the credit
period for which the
credit is first claimed under this section.
The credit allowed by this
section is in addition to any credit
allowed under section
5729.031 of the Revised Code.
Sec. 5729.07. As used in this section:
(A)
"Eligible employee" and
"eligible training costs" have
the
same meanings as in section 5733.42 of the Revised Code.
(B)
"Credit period" means the calendar year ending on the
thirty-first day of December next preceding the day the annual
statement is required to be returned under section 5729.02 of the
Revised Code.
There is hereby allowed a nonrefundable credit against the
tax
imposed under this chapter for a foreign insurance company for
which a
tax credit certificate is issued under section 5733.42 of
the Revised Code. The credit may
be
claimed for credit periods
beginning on or after January 1,
2003,
and ending on or
before
December 31,
2007 2008. The amount of the
credit
for the
credit
period beginning on January 1, 2003, shall
equal one-half
of the
average of the eligible training costs paid
or incurred by
the
company
during
calendar years
1998, 1999, and
2000, not to
exceed
one thousand dollars
for
each
eligible
employee on account
of whom
eligible training
costs were
paid or
incurred by the
company.
The
amount of the credit for the credit
period beginning
on January 1,
2004, shall equal one-half of the
average of the
eligible training
costs paid or incurred by the
company during
calendar years 2002,
2003, and 2004, not to exceed
one thousand
dollars for each
eligible employee on account of whom
eligible
training costs were
paid or incurred by the company. The
amount
of the credit for the
credit period beginning on January 1,
2005,
shall equal one-half
of the average of the eligible training
costs
paid or incurred by
the company during calendar years 2003,
2004,
and 2005, not to
exceed one thousand dollars for each
eligible
employee on account
of whom eligible training costs were
paid or
incurred by the
company. The amount of the credit for the credit period beginning
on January 1, 2006, shall equal one-half of the average of the
eligible training costs paid or incurred by the company during
calendar years 2004, 2005, and 2006, not to exceed one thousand
dollars for each eligible employee on account of whom eligible
training costs were paid or incurred by the company. The amount of
the credit for the credit period beginning on January 1, 2007,
shall equal one-half of the average of the eligible training costs
paid or incurred by the company during calendar years 2005, 2006,
and 2007, not to exceed one thousand dollars for each eligible
employee on account of whom eligible training costs were paid or
incurred by the company. The
amount
of the credit for the
credit
period beginning on January 1,
2008,
shall equal one-half
of the
average of the eligible training
costs
paid or incurred by
the
company during calendar years 2006,
2007,
and 2008, not to
exceed
one thousand dollars for each
eligible
employee on account
of
whom eligible training costs were
paid or
incurred by the
company.
The
credit claimed
by
a company
for each
credit period shall
not
exceed one hundred
thousand
dollars.
A foreign insurance company shall apply to the director of
job and family
services for a tax credit certificate in the manner
prescribed by
division (C) of section 5733.42 of the Revised Code.
Divisions
(C) to (H) of that section
govern the tax credit allowed
by this section, except that
"credit period"
shall be substituted
for
"tax year with respect to a calendar year" wherever that
phrase
appears in those divisions and that the company shall be
considered a
taxpayer for the purposes of those divisions.
A foreign insurance company may carry forward the credit
allowed
under this section to the extent that the credit exceeds
the company's
tax due for the credit period. The company may
carry
the excess credit
forward for three credit periods following
the
credit period for
which the credit is first claimed under this
section. The credit
allowed by this section is in addition to any
credit allowed under
section 5729.031 of the Revised Code.
The reduction in the tax due under this chapter to the extent
of
the credit allowed by this section does not increase the amount
of the
tax otherwise due under section 5729.06 of the Revised
Code.
Sec. 5733.42. (A) As used in this section:
(1)
"Eligible training program" means a program to provide
job
skills to eligible employees who are unable effectively to
function on the job due to skill deficiencies or who would
otherwise be displaced because of their skill deficiencies or
inability to use new technology, or to provide job skills to
eligible employees that enable them to perform other job duties
for the
taxpayer. Eligible training programs do
not include
executive, management, or personal
enrichment training programs,
or training programs intended
exclusively for personal career
development.
(2)
"Eligible employee" means an individual who is employed
in this state by a taxpayer and has been so employed by the same
taxpayer for at least one
hundred eighty consecutive days before
the day an application for the credit is filed under
this section.
"Eligible employee" does not include
any employee for which a
credit is claimed pursuant to division
(A)(5) of section
5709.65
of the Revised Code for all or any part of the same year, an
employee who is not a full-time employee, or executive or
managerial personnel, except for the immediate supervisors of
nonexecutive, nonmanagerial personnel.
(3)
"Eligible training costs" means:
(a) Direct instructional costs, such as instructor
salaries,
materials and supplies, textbooks and manuals, videotapes, and
other
instructional media and training equipment
used exclusively
for the purpose of training eligible employees;
(b) Wages paid to eligible employees for time devoted
exclusively
to an eligible training
program during normal paid
working hours.
(4)
"Full-time employee" means an individual who is employed
for
consideration for at least thirty-five hours per week, or who
renders any
other standard of service generally accepted by custom
or specified by
contract as full-time employment.
(5)
"Partnership" includes a limited liability company
formed
under
Chapter 1705. of the Revised Code or under the laws
of
another state, provided that
the company is not classified for
federal income tax purposes as an
association taxable as a
corporation.
(B) There is hereby allowed
a nonrefundable credit against
the tax imposed
by section 5733.06 of the Revised Code
for
taxpayers for which a tax credit certificate is issued under
division (C) of this section.
The credit may
be claimed for
tax
years 2004,
2005, 2006, 2007, and 2008, and 2009.
The amount of
the
credit for
tax year
2004 shall equal one-half of the
average
of
the eligible
training costs
paid or incurred by the taxpayer
during
calendar
years
1999, 2000, and 2001, not to
exceed
one
thousand dollars
for each
eligible employee on
account of
whom
eligible training
costs were
paid or
incurred by
the taxpayer
during those calendar
years.
The amount of the
credit for tax year
2005 shall equal
one-half of the average of
the eligible training
costs paid or
incurred by the taxpayer
during calendar years 2002,
2003, and
2004, not to exceed one
thousand dollars for each
eligible
employee on account of whom
eligible training costs were
paid or
incurred by the taxpayer
during those calendar years. The
amount
of the credit for tax
year 2006 shall equal one-half of the
average of the eligible
training costs paid or incurred by the
taxpayer during calendar
years 2003, 2004, and 2005, not to exceed
one thousand dollars for
each eligible employee on account of whom
eligible training costs
were paid or incurred by the taxpayer
during those calendar years.
The amount of the credit for tax year
2007 shall equal one-half of the average of the eligible training
costs paid or incurred by the taxpayer during calendar years 2004,
2005, and 2006, not to exceed one thousand dollars for each
eligible employee on account of whom eligible training costs were
paid or incurred by the taxpayer during those calendar years. The
amount of the credit for tax year 2008 shall equal one-half of the
average of the eligible training costs paid or incurred by the
taxpayer during calendar years 2005, 2006, and 2007, not to exceed
one thousand dollars for each eligible employee on account of whom
eligible training costs were paid or incurred by the taxpayer
during those calendar years. The amount of the credit for tax year
2009 shall equal one-half of the average of the eligible training
costs paid or incurred by the taxpayer during calendar years 2006,
2007, and 2008, not to exceed one thousand dollars for each
eligible employee on account of whom eligible training costs were
paid or incurred by the taxpayer during those calendar years.
The credit claimed by a
taxpayer each
tax
year
shall not
exceed
one hundred thousand dollars.
(C) A taxpayer who proposes to conduct an eligible training
program may apply to the director of job and family services
for a
tax credit certificate under this section.
The taxpayer may apply
for such a certificate for
tax years 2004, 2005, 2006, 2007,
and
2008, and 2009 subject to
division
(L) of this section.
The
director shall
prescribe the form of
the
application, which shall
require a
detailed description of the
proposed training program.
The
director may require applicants to
remit an application fee
with
each application filed with the
director. The fee shall not
exceed
the reasonable and necessary
expenses incurred by the
director in
receiving, reviewing, and
approving such applications
and issuing tax credit
certificates.
Proceeds
from fees shall be
used solely for the purpose of
receiving,
reviewing, and approving
such applications and issuing
such certificates.
After receipt of an application, the
director shall authorize
a credit under this section
by issuing a tax credit
certificate,
in the form prescribed by the director, if
the director determines
all of the following:
(1) The proposed training program is an eligible training
program
under this section;
(2) The proposed training program is economically sound
and
will
benefit the people of this state by improving workforce
skills and
strengthening the economy of this state;
(3) Receiving the tax credit is a major factor in the
taxpayer's
decision to go forward with the training program;
(4) Authorization of the credit is consistent with
division
(H)
of this section.
The credit also is allowed for a taxpayer that is a partner
in a
partnership that pays or incurs eligible training costs.
Such
a taxpayer
shall determine the taxpayer's credit amount in
the
manner prescribed by
division (K) of this section.
(D) If the director of job and family services denies an
application for a
tax credit certificate, the director shall send
notice of the denial and the
reason for denial to the applicant by
certified mail, return receipt
requested. If the director
determines that an
authorized
training program, as actually
conducted, fails to meet the requirements of
this section or to
comply with any condition set forth in the
authorization, the
director may reduce the amount of the
tax credit previously
granted.
If the director reduces a
tax credit, the director shall
send notice of the reduction and the reason
for the reduction to
the taxpayer by certified mail, return receipt requested,
and
shall certify the reduction to the tax
commissioner or, in the
case of the reduction of a credit
claimed by an insurance company,
the superintendent of insurance. The tax
commissioner or
superintendent of insurance shall reduce the credit
that may be
claimed by the taxpayer accordingly. Within sixty days after
receiving a notice of denial or notice of reduction of the tax
credit, an
applicant or taxpayer may request, in writing, a
hearing before the director
to review the denial or reduction.
Within sixty days after receiving a
request that is filed within
the prescribed time, the director shall hold such
a hearing at a
location to be determined by the director. Within thirty days
after the hearing is adjourned, the director shall issue a
redetermination
affirming, reversing, or modifying the denial or
reduction of the tax credit
and send notice of the redetermination
to the applicant or taxpayer by
certified mail, return receipt
requested, and shall issue a notice of the
redetermination to the
tax commissioner or superintendent of insurance. If an
applicant
or taxpayer is aggrieved by the director's redetermination, the
applicant or taxpayer may appeal the redetermination to the board
of tax
appeals in the manner prescribed by section 5717.02 of the
Revised Code.
(E) A taxpayer to which a tax credit certificate is
issued
shall retain records indicating the eligible training costs it
pays or
incurs for the eligible training program for which the
certificate is issued
for four years following the end of the tax
year
for which the credit is claimed. Such records shall be open
to inspection by
the
director of
job and family services upon the
director's request during business hours.
Financial statements and other information submitted
by an
applicant to the director of job and family services
for a tax
credit under this
section, and any information taken for any
purpose from such
statements or information, are not public
records subject to
section 149.43 of the Revised Code. However,
the director
of job and family services, the tax
commissioner, or
superintendent of insurance
may make use of the statements and
other information for purposes of issuing
public reports or in
connection with court proceedings
concerning tax credits allowed
under this section and sections 5725.31,
5729.07, and 5747.39 of
the Revised Code.
(F) The director of job and family services, in
accordance
with Chapter
119. of the Revised Code, shall adopt rules necessary
to
implement
this section and sections 5725.31, 5729.07, and
5747.39 of the Revised Code. The
rules shall be adopted after
consultation with the tax
commissioner and the superintendent of
insurance. The rules shall require that if a taxpayer to which a
tax credit certificate is issued under any of those sections
permanently relocates or transfers employees trained under the tax
credit certificate to another state or country within two years of
receiving the certificate, the taxpayer shall repay the total
amount of the tax credit received by the taxpayer for any
employees permanently relocated or transferred. At the
time the
director gives public notice under
division (A) of section 119.03
of the
Revised Code of the adoption
of the
rules, the director
shall submit copies of the proposed
rules to the
chairpersons and
ranking minority members of the
standing committees in
the senate
and the house of representatives
to which legislation on economic
development matters are
customarily referred.
(G) On or before the thirtieth day of September of 2001,
2003,
2004,
2005, 2006, 2007, and 2008, and 2009 the director of
job and
family
services
shall submit a report to the governor, the
president
of
the
senate, and the speaker of the house of
representatives on
the
tax
credit program under this section and
sections 5725.31,
5729.07,
and 5747.39 of the Revised Code. The
report shall
include
information on the number of training
programs that were
authorized under those sections during the
preceding calendar
year,
a description of each authorized training
program, the
dollar
amounts of the credits granted, and an
estimate of the
impact of
the credits on the economy of this
state.
(H) The aggregate amount of credits authorized under this
section and sections 5725.31, 5729.07, and 5747.39 of the Revised
Code
shall not exceed twenty million dollars per calendar year.
No
more than ten
million dollars in credits per calendar year
shall
be authorized for persons engaged primarily in
manufacturing.
No
less than five million dollars in credits per
calendar year
shall
be set aside for persons engaged primarily
in
activities other
than manufacturing and having fewer than five
hundred employees.
Subject to such limits, the director of job and family services
shall adopt a rule under division (F) of this section that
establishes criteria and procedures for distribution of the
credits.
(I) A nonrefundable credit allowed under
this section shall
be claimed in the order required under section 5733.98
of the
Revised Code.
(J) The taxpayer may carry forward any credit amount in
excess of
its tax due after allowing for any other credits that
precede the
credit under this section in the order required under
section
5733.98 of the Revised Code. The excess
credit may be
carried forward
for three years following the tax year for which
it is
first claimed under this section.
(K) A taxpayer that is a
partner in a partnership on the
last
day of the third calendar year of the
three-year period
during
which the
partnership pays or incurs eligible training
costs may
claim a credit under
this section for the tax year
immediately
following that calendar year. The
amount of a
partner's credit
equals the partner's interest in the partnership
on the last day
of such
calendar year multiplied by the credit
available to the
partnership as
computed by the partnership.
(L) The director of job and family services
shall not
authorize any credits under this
section and sections 5725.31,
5729.07, and 5747.39 of the Revised Code for eligible
training
costs paid or incurred after December
31,
2007 2008.
Sec. 5747.39. (A) As used in this section,
"eligible
employee"
and
"eligible training costs" have the same meanings as
in section
5733.42
of the Revised Code, and
"pass-through entity"
includes a
sole
proprietorship.
(B)(1) For taxable years beginning
in 2003,
2004, 2005, 2006,
and 2007, and 2008 there is
hereby allowed a nonrefundable credit
against the tax
imposed by
section 5747.02 of the Revised Code for
a taxpayer that
is an
investor in a
pass-through
entity for which
a tax credit
certificate is issued under section 5733.42
of the
Revised Code.
For the taxable year beginning in 2003, the
amount
of eligible
training costs for which a credit may be
claimed by
all taxpayers
that are investors in an entity shall
equal one-half
of the
average of the
eligible training costs
incurred by the
entity
during
calendar
years
1999, 2000, and
2001,
but shall not
exceed
one
thousand dollars for each
eligible
employee on account
of whom
such costs were paid or
incurred by
the
entity.
The amount
of a taxpayer's credit for the taxpayer's taxable
year beginning
in 2003 shall equal the taxpayer's interest in the
entity on
December 31, 2001, multiplied by the credit available to
the
entity as computed by the entity.
(2) For the taxable year beginning in 2004, the amount of the
eligible training costs for which a credit may be claimed by all
taxpayers that are investors in an entity shall equal one-half of
the average of the eligible training costs incurred by the entity
during calendar years 2002, 2003, and 2004, but shall not exceed
one thousand dollars for each eligible employee on account of whom
such costs were paid or incurred by the entity. The amount of a
taxpayer's credit for the taxpayer's taxable year beginning in
2004 shall equal the taxpayer's interest in the entity on December
31, 2004, multiplied by the credit available to the entity as
computed by the entity.
(3) For the taxable year beginning in 2005, the amount of the
eligible training costs for which a credit may be claimed by all
taxpayers that are investors in an entity shall equal one-half of
the average of the eligible training costs incurred by the entity
during calendar years 2003, 2004, and 2005, but shall not exceed
one thousand dollars for each eligible employee on account of whom
such costs were paid or incurred by the entity. The amount of a
taxpayer's credit
for the taxpayer's taxable year beginning in
2005 shall equal the taxpayer's
interest in the entity on
December
31,
2005, multiplied by the credit available to the
entity as
computed
by the entity.
(4) For the taxable year beginning in 2006, the amount of the
eligible training costs for which a credit may be claimed by all
taxpayers that are investors in an entity shall equal one-half of
the average of the eligible training costs incurred by the entity
during calendar years 2004, 2005, and 2006, but shall not exceed
one thousand dollars for each eligible employee on account of whom
such costs were paid or incurred by the entity. The amount of a
taxpayer's credit for the taxpayer's taxable year beginning in
2006 shall equal the taxpayer's interest in the entity on December
31, 2006, multiplied by the credit available to the entity as
computed by the entity.
(5) For the taxable year beginning in 2007, the amount of the
eligible training costs for which a credit may be claimed by all
taxpayers that are investors in an entity shall equal one-half of
the average of the eligible training costs incurred by the entity
during calendar years 2005, 2006, and 2007, but shall not exceed
one thousand dollars for each eligible employee on account of whom
such costs were paid or incurred by the entity. The amount of a
taxpayer's credit for the taxpayer's taxable year beginning in
2007 shall equal the taxpayer's interest in the entity on December
31, 2007, multiplied by the credit available to the entity as
computed by the entity.
(6) For the taxable year beginning in 2008, the amount of the
eligible training costs for which a credit may be claimed by all
taxpayers that are investors in an entity shall equal one-half of
the average of the eligible training costs incurred by the entity
during calendar years 2006, 2007, and 2008, but shall not exceed
one thousand dollars for each eligible employee on account of whom
such costs were paid or incurred by the entity. The amount of a
taxpayer's credit for the taxpayer's taxable year beginning in
2008 shall equal the taxpayer's interest in the entity on December
31, 2008, multiplied by the credit available to the entity as
computed by the entity.
(7) The total amount of credits that may be claimed by all
such taxpayers with respect to each pass-through entity for each
taxable year shall not exceed one hundred thousand dollars.
(C) The credit shall be claimed in the order prescribed by
section 5747.98
of the Revised Code. A taxpayer may carry forward
the credit to the
extent that the taxpayer's credit exceeds the
taxpayer's tax due after allowing for any other credits that
precede the credit allowed by this section in the order prescribed
by section 5747.98 of the Revised Code. The taxpayer may carry
the
excess credit forward for three taxable years following the
taxable
year for which the taxpayer first claims the credit under
this section.
(D) A pass-through entity shall apply to the director of job
and
family
services
for a tax credit certificate in the manner
prescribed by
division (C) of section 5733.42 of the Revised Code.
Divisions
(C) to (H) of that section
govern the tax credit allowed
by this section, except that
"taxable year"
shall be substituted
for
"tax year" wherever that phrase appears in
those divisions,
and
that
"pass-through entity" shall be substituted for
"taxpayer"
wherever
"taxpayer" appears in those divisions.
Section 2. That existing sections 5725.31, 5729.07, 5733.42,
and 5747.39 of the Revised Code are hereby repealed.
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