[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3110 Introduced in House (IH)]







105th CONGRESS
  2d Session
                                H. R. 3110

 To amend the Internal Revenue Code of 1986 to allow small employers a 
 credit against income tax for certain expenses for long-term training 
          of employees in highly skilled metalworking trades.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 27, 1998

 Mr. Talent (for himself, Mr. LaTourette, and Mr. Paul) introduced the 
 following bill; which was referred to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to allow small employers a 
 credit against income tax for certain expenses for long-term training 
          of employees in highly skilled metalworking trades.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Skilled Workforce Enhancement Act of 
1998''.

SEC. 2. CREDIT FOR EXPENSES FOR TRAINING EMPLOYEES IN HIGHLY SKILLED 
              METALWORKING TRADES.

    (a) In General.--Subpart D of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to business-related 
credits) is amended by adding at the end the following new section:

``SEC. 45D. EXPENSES FOR TRAINING EMPLOYEES IN HIGHLY SKILLED 
              METALWORKING TRADES.

    ``(a) General Rule.--For purposes of section 38, the highly skilled 
metalworking trades training credit determined under this section is an 
amount equal to 80 percent of the training expenses paid or incurred by 
the taxpayer during the training period with respect to each qualified 
trained employee of the taxpayer. Twenty percent of the credit 
determined under the preceding sentence shall be taken into account 
under section 38 for each of the first 5 taxable years after the 
taxable year in which the training period ends.
    ``(b) Limitations.--
            ``(1) Maximum credit per employee.--The total amount of 
        credit determined under this section with respect to each 
        qualified trained employee for all taxable years shall not 
        exceed $100,000.
            ``(2) Employer must be small employer.--Training expenses 
        may be taken into account under subsection (a) only if the 
        taxpayer is a small employer for the taxable year in which such 
        expenses are paid or incurred.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Qualified trained employee.--
                    ``(A) In general.--The term `qualified trained 
                employee' means any employee (or former employee) of 
                the taxpayer if--
                            ``(i) the employee received at least 8,000 
                        hours of training (including on-the-job 
                        training) from the taxpayer (or any 
                        predecessor) during the training period as an 
                        apprentice in any highly skilled metalworking 
                        trade, and
                            ``(ii) the employee is employed by the 
                        taxpayer in a journeyman capacity in any highly 
                        skilled metalworking trade on a full-time basis 
                        throughout at least the 1-year period beginning 
                        at the end of such employee's training period.
                    ``(B) Highly skilled metalworking trades.--For 
                purposes of subparagraph (A), the term `highly skilled 
                metalworking trades' means the trades traditionally 
                recognized as such, including precision machinists, die 
                makers, mold makers, and tool and die designers in the 
                tooling and machining industry.
            ``(2) Training expenses.--
                    ``(A) In general.--The term `training expenses' 
                means wages paid or incurred to an employee of the 
                taxpayer for services performed in a highly skilled 
                metalworking trade while the employee is an apprentice 
                in such trade.
                    ``(B) Wages.--The term `wages' has the meaning 
                given such term by section 3401(a).
            ``(3) Training period.--The term `training period' means 
        the period of 4 years beginning on the date that the employee 
        begins employment with the taxpayer as an apprentice in a 
        highly skilled metalworking trade.
            ``(4) Small employer.--
                    ``(A) In general.--The term `small employer' means, 
                with respect to any taxable year, any employer who 
                employed an average of 500 or fewer employees on 
                business days during such taxable year.
                    ``(B) Controlled groups.--For purposes of 
                subparagraph (A), all persons treated as a single 
                employer under subsection (b), (c), (m), or (o) of 
                section 414 shall be treated as 1 employer.
    ``(d) Coordination With Other Credits.--Wages taken into account 
under subsection (a) shall not be taken into account in determining the 
credits under sections 51(a) and 1396(a).''.
    (b) Credit Made Part of General Business Credit.--Subsection (b) of 
section 38 of such Code is amended by striking ``plus'' at the end of 
paragraph (11), by striking the period at the end of paragraph (12) and 
inserting ``, plus'', and by adding at the end the following new 
paragraph:
            ``(13) the highly skilled metalworking trades training 
        credit determined under section 45D(a).''.
    (c) Denial of Double Benefit.--Section 280C of such Code is amended 
by adding at the end the following new subsection:
    ``(d) Credit for Training Expenses for Employees in Highly Skilled 
Metalworking Trades.--No deduction shall be allowed for that portion of 
the expenses otherwise allowable as a deduction for the taxable year 
which is equal to the amount of the credit determined for such taxable 
year under section 45D(a).''.
    (d) 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. 45D. Expenses for training 
                                        employees in highly skilled 
                                        metalworking trades.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to expenses paid or incurred after the date of the enactment of 
this Act in taxable years ending after such date.
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