Short title

This Act may be cited as the

Workforce Development Investment Act of 2023

Credit for employers which partner with educational institutions to improve workforce development and job training for students

(a)

In general

Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:

45BB.

Employers partnering with educational institutions to improve workforce development and job training for students

(a)

General rule

For purposes of section 38, the employer partnering credit determined under this section for any taxable year is an amount equal to $5,000 for each qualified educational institution engaged in a qualified partnership with the employer. (b)

Maximum credit

(1)

In general

The credit determined under this section for any taxable year shall not exceed $20,000. (2)

Controlled groups

All persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 shall be treated as a single employer for purposes of paragraph (1). (c)

Definitions

For purposes of this section— (1)

Qualified educational institution

The term qualified educational institution means any community college, any other institution of higher education, and any area career and technical education school. (2)

Community college

The term community college means an institution of higher education that— (A)admits as a regular student an individual who is beyond the age of compulsory school attendance in the State in which the institution is located and who has the ability to benefit from the training offered by the institution, and (B)offers a 2-year program in engineering, mathematics, or the physical or biological sciences designed to prepare a student to work as a technician or at the semiprofessional level in engineering, scientific, or other technological fields requiring the understanding and application of basic engineering, scientific, or mathematical principles of knowledge. (3)

Institution of higher education

The term institution of higher education has the meaning given such term in section 102 of the Higher Education Act of 1965 (20 U.S.C. 1002). (4)

Area career and technical education school

The term area career and technical education school has the meaning given such term in section 3 of the Carl D. Perkins Career and Technical Education Act of 2006 (29 U.S.C. 2302). (5)

Qualified partnership

Not later than six months after the date of the enactment of this section, the Secretary of Education, in consultation with the Secretary of Labor, shall define the term qualified partnership. Such term shall include a partnership through which— (A)an employer collaborates with an educational institution to help develop curriculum in order to improve workforce development and job training for students, (B)an employer helps provide instruction to students in the classroom, and (C)an employer provides internships, apprenticeships, or other similar educational opportunities in the workplace for students.

The Secretary shall, to the extent practicable, minimize the burdens of educational institutions in any qualification process or requirements prescribed under this paragraph.

(d)

Certain rules To Apply

For purposes of this section, rules similar to the rules of subsections (c), (d), and (e) of section 52 shall apply.

(b)

Credit To be part of general business credit

Section 38(b) of such Code is amended by striking plus at the end of paragraph (40), by striking the period at the end of paragraph (41) and inserting , plus, and by adding at the end the following new paragraph:

(42)the employer partnering credit determined under section 45BB.

(c)

Clerical amendment

The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item:

Sec. 45BB. Employers partnering with educational institutions to improve workforce development and job training for students.

(d)

Effective date

The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.

Tax credit for employers who engage in qualified worker training

(a)

In general

Subpart D of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986, as amended by the preceding provisions of this Act, is amended by adding at the end the following new section:

45CC.

Credit for employers who engage in qualified worker training

(a)

In general

For purposes of section 38, in the case of any employer, the worker training tax credit determined under this section with respect to any eligible employee of the employer is an amount equal to the lesser of— (1)50 percent of the job training program expenditures of the taxpayer with respect to such employee during the taxable year, or (2)$5,000. (b)

Job training program expenses

For purposes of this section— (1)

In general

The term job training program expenses means amounts paid or incurred by the employer for expenses incurred by or on behalf of an eligible employee for participation in a qualified training program. (2)

Qualified training program

The term qualified training program means— (A)a qualified partnership (as defined in section 45BB(c)(5)), or (B)an apprenticeship program registered and certified with the Secretary of Labor under section 1 of the National Apprenticeship Act (29 U.S.C. 50). (c)

Eligible employee

For purposes of this section, the term eligible employee means any employee of the employer who, while participating in the qualified training program, is— (1)employed on average at least 40 hours of service per week, or (2)in the case of a qualified training program with a qualified partnership (as defined in section 45BB(c)(5)), meets such hourly work requirements as may be specified by the Secretary of Education in connection with such partnership. (d)

Recapture of credit for employee not performing minimum service

(1)

In general

In the case of any employee with respect to whom a credit is allowed under this section and whose employment is terminated by the employer (other than by reason of such employee’s gross misconduct) before the end of the 2-year period beginning on the first day of the employee’s study or training with respect to which a credit is allowed under this section, the tax of the taxpayer under this chapter for the taxable year during which such termination occurs shall be increased by an amount equal to— (A)the aggregate decrease in the credits allowed under section 38 for all prior taxable years which would have resulted if the job training program expenses with respect to such employee had been zero, multiplied by (B)the inclusion ratio. (2)

Inclusion ratio

For purposes of this subsection, the inclusion ratio is the ratio which— (A)an amount equal to the difference of— (i)the number of days in the 2-year period, over (ii)the number of days such employee was employed by the employer during such 2-year period, bears to (B)the number of days in the 2-year period. (e)

Controlled groups

For purposes of this section, all persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 shall be treated as a single employer.

(b)

Credit To be part of general business credit

Subsection (b) of section 38 of such Code, as amended by the preceding provisions of this Act, is amended by striking plus at the end of paragraph (41), by striking the period at the end of paragraph (42) and inserting , plus, and by adding at the end the following new paragraph:

(43)the worker training tax credit determined under section 45CC(a).

(c)

Clerical amendment

The table of sections for subpart D of part IV of subchapter A of chapter 1 of such Code, as amended by the preceding provisions of this Act, is amended by adding at the end the following new item:

Sec. 45CC. Credit for employers who engage in qualified worker training.

(d)

Effective date

The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.