Tax credit for contributions of individuals to workforce development or apprenticeship training programs

(a)

Allowance of credit

(1)

In general

Subpart A of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 25E the following new section:

25F.

Contributions to workforce development and apprenticeship training programs

(a)

Allowance of credit

In the case of an individual, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the aggregate amount of qualified contributions made by the taxpayer during the year.(b)

Limitations

(1)

In general

The credit allowed under subsection (a) to any taxpayer for any taxable year shall not exceed an amount equal to the lesser of—(A)25 percent of the sum of the amounts described in paragraphs (1) and (2) of section 26(a) for such taxable year, or(B)$150,000.(2)

Allocation of volume cap

The credit allowed under subsection (a) to any taxpayer for any taxable year shall not exceed the amount of the volume cap allocated by the Secretary to such taxpayer under subsection (f) with respect to qualified contributions made by the taxpayer during the taxable year.(3)

Reduction based on State credit

The amount allowed as a credit under subsection (a) for a taxable year shall be reduced by the amount allowed as a credit on any State tax return of the taxpayer for qualified contributions made by the taxpayer during the taxable year. (c)

Definitions

For purposes of this section—(1)

Qualified contribution

The term qualified contribution means a charitable contribution (as defined by section 170(c)) to a workforce development or apprenticeship training organization in the form of cash or marketable securities if such contribution is designated by such organization to be used only for the purpose of providing workforce development or apprenticeship training programs.(2)

Workforce development or apprenticeship training organization

The term workforce development or apprenticeship training organization means any organization which—(A)is described in section 501(c)(3), is exempt from tax under section 501(a), and is not a private foundation, and(B)is included on a list of providers prepared under subsection (d) of section 122 of the Workforce Innovation and Opportunity Act (29 U.S.C. 3152) by reason of having been determined to be eligible to offer a program under such section.(3)

Workforce development or apprenticeship training program

The term workforce development or apprenticeship training program means a program to provide training services (within the meaning of section 134(c)(3) of the Workforce Innovation and Opportunity Act (29 U.S.C. 3174(c)(3))).(d)

Denial of double benefit

Any qualified contribution for which a credit is allowed under this section shall not be taken into account as a charitable contribution for purposes of section 170.(e)

Carryforward of unused credit

(1)

In general

If the credit allowable under subsection (a) for any taxable year exceeds the limitation imposed by section 26(a) for such taxable year reduced by the sum of the credits allowable under this subpart (other than this section, section 23, and section 25D), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year.(2)

Limitation

No credit may be carried forward under this subsection to any taxable year following the fifth taxable year after the taxable year in which the credit arose. For purposes of the preceding sentence, credits shall be treated as used on a first-in first-out basis.(f)

Volume cap

(1)

In general

The volume cap applicable under this section shall be $5,000,000,000 for each of calendar years 2025 through 2028, and zero for calendar years thereafter. Such amount shall be allocated by the Secretary as provided in paragraph (2) to taxpayers with respect to qualified contributions made by such taxpayers, except that 10 percent of such amount shall be divided evenly among the States, and shall be available with respect to individuals residing in such States.(2)

First-come, first-serve

For purposes of applying the volume cap under this section, such volume cap for any calendar year shall be allocated by the Secretary on a first-come, first-serve basis, as determined based on the time (during such calendar year) at which the taxpayer made the qualified contribution with respect to which the allocation is made. The Secretary shall not make any allocation of volume cap for any calendar year after December 31 of such calendar year.(3)

Real-time information

For purposes of this section, the Secretary shall develop a system to track the amount of qualified contributions made during the calendar year for which a credit may be claimed under this section, with such information to be updated in real time. (4)

Annual increases

(A)

In general

In the case of the calendar year after a high use calendar year, the dollar amount otherwise in effect under subsection (a) for such calendar year shall be equal to 105 percent of the dollar amount in effect for such high use calendar year.(B)

High use calendar year

For purposes of this subsection, the term high use calendar year means any calendar year for which 90 percent or more of the volume cap in effect for such calendar year under subsection (a) is allocated to taxpayers.(C)

Prevention of decreases in annual volume cap

The volume cap in effect under subsection (a) for any calendar year shall not be less than the volume cap in effect under such subsection for the preceding calendar year.(D)

Publication of annual volume cap

The Secretary shall make publicly available the dollar amount of the volume cap in effect under subsection (a) for each calendar year.(5)

States

For purposes of this subsection, the term State includes the District of Columbia.

(2)

Conforming amendments

(A)Section 25(e)(1)(C) of such Code is amended by striking and 25D and inserting 25D, and 25F. (B)The table of sections for subpart A of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 25E the following new item:

Sec. 25F. Contributions to workforce development and apprenticeship training programs.

(b)

Effective date

The amendments made by this subsection shall apply to taxable years ending after December 31, 2024.