I

106TH CONGRESS

2D SESSION H. R. 5597

To amend the Internal Revenue Code of 1986 to allow employers a credit

against income tax for internships and fellowships related to information

technology.

IN THE HOUSE OF REPRESENTATIVES

OCTOBER 27, 2000

Ms. MILLENDER-MCDONALD 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 employers a credit against income tax for internships and

fellowships related to information technology.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Technology Training

5 Tax Credit Act of 2000’’.

6 SEC. 2. CREDIT FOR INTERNSHIPS AND FELLOWSHIPS RE7 LATING TO INFORMATION TECHNOLOGY.

8 (a) GENERAL RULE.—Subpart D of part IV of sub9 chapter A of chapter 1 of the Internal Revenue Code of
2

•HR 5597 IH

1 1986 (relating to business related credits) is amended by

2 adding at the end thereof the following new section:

3 ‘‘SEC. 45D. INTERNSHIPS AND FELLOWSHIPS RELATING TO

4 INFORMATION TECHNOLOGY.

5 ‘‘(a) GENERAL RULE.—For purposes of section 38,

6 the amount of the information technology internship and

7 fellowship credit determined under this section for the tax8 able year is 75 percent of the qualified technology training

9 expenses paid or incurred by the taxpayer during the tax10 able year.

11 ‘‘(b) INCREASE IN PERCENTAGE WITH RESPECT TO

12 MEMBERS OF TARGETED GROUPS AND EMPLOYEE RE13 SIDING IN CERTAIN AREAS.—Subsection (a) shall be ap14 plied by substituting ‘100 percent’ for ‘75 percent’ in the

15 case of qualified technology training expenses with respect

16 to an eligible individual and who—

17 ‘‘(1) is a member of a targeted group (as de18 fined in section 51(d)), or

19 ‘‘(2) resides in—

20 ‘‘(A) an empowerment zone or enterprise

21 community designated under section 1391,

22 ‘‘(B) a school district in which 50 percent

23 or more of the students are eligible for free or

24 reduced-cost lunches under the school lunch
3

•HR 5597 IH

1 program established under the National School

2 Lunch Act, or

3 ‘‘(C) in an area designated as a disaster

4 area by the Secretary of Agriculture or by the

5 President under the Robert T. Stafford Dis6 aster Relief and Emergency Assistance Act in

7 the taxable year or the 5 preceding taxable

8 years.

9 For purposes of the preceding sentence, the deter10 mination of whether an individual is a member of a

11 targeted group or resides in an area described in

12 paragraph (2) shall be made as of the date on which

13 the individual is awarded an internship or fellowship

14 (as the case may be).

15 ‘‘(c) LIMITATIONS.—

16 ‘‘(1) ANNUAL.—The amount of qualified tech17 nology training expenses that may be taken into ac18 count under this section for a taxable year with re19 spect to an eligible individual shall not exceed the

20 lesser of—

21 ‘‘(A) $10,000, or

22 ‘‘(B) the amount of qualified technology

23 training expenses paid or incurred in such tax24 able year with respect to such individual.
4

•HR 5597 IH

1 ‘‘(2) 3 YEARS PER INDIVIDUAL.—An individual

2 shall not be treated as an eligible individual for pur3 poses of this section if the taxpayer was allowed a

4 credit under subsection (a) with respect to such indi5 vidual in any 3 prior taxable year.

6 ‘‘(d) QUALIFIED TECHNOLOGY TRAINING EX7 PENSES.—For purposes of this section—

8 ‘‘(1) IN GENERAL.—Except as otherwise pro9 vided in this subsection, the term ‘qualified tech10 nology training expenses’ means amounts paid or in11 curred by the taxpayer under a qualified technology

12 program in connection with providing internships

13 and fellowships to eligible individuals.

14 ‘‘(2) TRAINING PROVIDED IN UNITED

15 STATES.—Amounts may be taken into account under

16 paragraph (1) with respect to any individual only if

17 substantially all of the education or training pro18 vided such individual during the taxable year with

19 respect to such amounts is provided in the United

20 States.

21 ‘‘(e) DEFINITIONS.—For purposes of this section—

22 ‘‘(1) QUALIFIED TECHNOLOGY PROGRAM.—

23 ‘‘(A) IN GENERAL.—The term ‘qualified

24 technology program’ means a program in which

25 the taxpayer awards internships or fellowships
5

•HR 5597 IH

1 for work at the taxpayer which provides train2 ing in computer programming, computer sys3 tems analysis, computer science, computer engi4 neering, or other information technology dis5 cipline.

6 ‘‘(B) PARTNERSHIP REQUIREMENT.—A

7 program shall not be treated as a qualified

8 technology program for purposes of subpara9 graph (A) unless—

10 ‘‘(i) such program is a partnership be11 tween the taxpayer and a state training

12 program or an eligible education institu13 tion, and

14 ‘‘(ii) the taxpayer pays or incurs at

15 least 50 percent of the technology training

16 expenses under such program.

17 ‘‘(2) ELIGIBLE INDIVIDUAL.—The term ‘eligible

18 individual’ means an individual who—

19 ‘‘(A) is a citizen, national, or lawful per20 manent resident of the United States, and

21 ‘‘(B) first becomes an employee of the tax22 payer on the date such individual begins the in23 ternship or fellowship with respect to which

24 such expenses are qualified technology training

25 expenses.
6

•HR 5597 IH

1 ‘‘(3) ELIGIBLE EDUCATION INSTITUTION.—The

2 term ‘eligible education institution’ has the meaning

3 given to such term by section 25B(f)(2).

4 ‘‘(f) DENIAL OF DOUBLE BENEFIT.—No credit shall

5 be allowed under this section for any expense for which

6 a credit or deduction is allowed under any other provision

7 of this chapter.’’.

8 (b) CREDIT MADE PART OF GENERAL BUSINESS

9 CREDIT.—Subsection (b) of section 38 of such Code is

10 amended by striking ‘‘plus’’ at the end of paragraph (11),

11 by striking the period at the end of paragraph (12) and

12 inserting ‘‘, plus’’, and by adding at the end thereof the

13 following new paragraph:

14 ‘‘(13) the information technology internship and

15 fellowship credit determined under section 45D(a).’’.

16 (c) LIMITATION ON CARRYBACK.—Subsection (d) of

17 section 39 of the Internal Revenue Code of 1986 (relating

18 to carryback and carryforward of unused credits) is

19 amended by adding at the end the following:

20 ‘‘(9) NO CARRYBACK OF INFORMATION TECH21 NOLOGY INTERNSHIP AND FELLOWSHIP CREDIT BE22 FORE EFFECTIVE DATE.—No amount of unused

23 business credit available under section 45D may be

24 carried back to a taxable year beginning on or before

25 the date of the enactment of this paragraph.’’.
7

•HR 5597 IH

1 (d) CLERICAL AMENDMENT.—The table of sections

2 for subpart D of part IV of subchapter A of chapter 1

3 of such Code is amended by adding at the end thereof

4 the following new section:

‘‘Sec. 45D. Internships and fellowships relating to information

technology.’’.

5 (e) EFFECTIVE DATE.—The amendments made by

6 this section shall apply to amounts paid or incurred after

7 the date of enactment of this Act in taxable years ending

8 after such date.

Æ