I 

116TH CONGRESS 

1ST SESSION H. R. 3368 

To establish a tax credit for on-site apprenticeship programs, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 19, 2019 

Ms. SA ́NCHEZ (for herself and Mr. FITZPATRICK) introduced the following bill; 

which was referred to the Committee on Ways and Means, and in addition to the Committee on Education and Labor, for a period to be subsequently determined by the Speaker, in each case for consideration of such 

provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To establish a tax credit for on-site apprenticeship programs, 

and for other purposes. 

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 ‘‘Apprenticeship and 

5 Jobs Training Act of 2019’’. 

6 SEC. 2. TAX CREDIT FOR APPRENTICESHIP PROGRAMS. 

7 (a) IN GENERAL.—Subpart D of part IV of sub8 chapter A of chapter 1 of the Internal Revenue Code of 


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1 1986 is amended by adding at the end the following new 

2 section: 

3 ‘‘SEC. 45T. CREDIT FOR APPRENTICESHIP PROGRAM EX4 PENSES. 

5 ‘‘(a) TAX CREDIT.— 

6 ‘‘(1) IN GENERAL.—For purposes of section 38, 

7 in the case of an employer, the apprenticeship pro8 gram credit determined under this section for any 

9 taxable year is an amount equal to— 

10 ‘‘(A) with respect to each qualified indi11 vidual in a qualified apprenticeship program, 

12 the lesser of— 

13 ‘‘(i) the amount of any wages (as de14 fined in section 51(c)(1)) paid or incurred 

15 by the employer with respect to such quali16 fied individual during the taxable year, or 

17 ‘‘(ii) $5,000, and 

18 ‘‘(B) with respect to each qualified indi19 vidual in a qualified multi-employer apprentice20 ship program, the lesser of— 

21 ‘‘(i) an amount equal to the product 

22 of— 

23 ‘‘(I) the total number of hours of 

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1 dividual for such employer during 

2 such taxable year, multiplied by 

3 ‘‘(II) $3, or 

4 ‘‘(ii) $5,000. 

5 ‘‘(2) ESTABLISHED APPRENTICESHIP PRO6 GRAMS.— 

7 ‘‘(A) IN GENERAL.—The apprenticeship 

8 program credit determined under this section 

9 for the taxable year shall only be applicable to 

10 the number of qualified individuals employed by 

11 the employer through a qualified apprenticeship 

12 program or a qualified multi-employer appren13 ticeship program which are in excess of the ap14 prenticeship participation average for such em15 ployer (as determined under subparagraph (B)). 

16 ‘‘(B) APPRENTICESHIP PARTICIPATION AV17 ERAGE.—For purposes of subparagraph (A), 

18 the apprenticeship participation average shall 

19 be equal to the average of the total number of 

20 qualified individuals employed by the employer 

21 through a qualified apprenticeship program or 

22 qualified multi-employer apprenticeship pro23 gram for— 

24 ‘‘(i) the 3 preceding taxable years, or 


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1 ‘‘(ii) the number of taxable years in 

2 which the qualified apprenticeship program 

3 or the qualified multi-employer apprentice4 ship program was in existence, whichever 

5 is less. 

6 ‘‘(3) DENIAL OF DOUBLE BENEFIT.—No deduc7 tion or any other credit shall be allowed under this 

8 chapter for any amount taken into account in deter9 mining the credit under this section. 

10 ‘‘(4) ELECTION NOT TO CLAIM CREDIT.—This 

11 section shall not apply to a taxpayer for any taxable 

12 year if such taxpayer elects to have this section not 

13 apply for such taxable year. 

14 ‘‘(5) LIMITATION.—The apprenticeship pro15 gram credit under this section shall not be allowed 

16 for more than 3 taxable years with respect to any 

17 qualified individual. 

18 ‘‘(b) QUALIFIED INDIVIDUAL.— 

19 ‘‘(1) IN GENERAL.—For purposes of this sec20 tion, the term ‘qualified individual’ means, with re21 spect to any taxable year, an individual who is an 

22 apprentice and— 

23 ‘‘(A) is participating in a qualified appren24 ticeship program or a qualified multi-employer 

25 apprenticeship program with an employer that 


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1 is subject to the terms of a valid apprenticeship 

2 agreement (as defined in the Act of August 16, 

3 1937 (commonly known as the ‘National Ap4 prenticeship Act’; 50 Stat. 664, chapter 663; 29 

5 U.S.C. 50 et seq.)), 

6 ‘‘(B) has been employed under a qualified 

7 apprenticeship program or a qualified multi-em8 ployer apprenticeship program for a period of 

9 not less than 7 months that ends within the 

10 taxable year, 

11 ‘‘(C) is not a highly compensated employee 

12 (as defined in section 414(q)), and 

13 ‘‘(D) is not a seasonal worker (as defined 

14 in section 45R(d)(5)(B)). 

15 ‘‘(2) TRAINING RECEIVED BY MEMBERS OF THE

16 ARMED FORCES.—An employer shall consider and 

17 may accept, in the case of a qualified individual par18 ticipating in a qualified apprenticeship program or a 

19 qualified multi-employer apprenticeship program, 

20 any relevant training or instruction received by such 

21 individual while serving in the Armed Forces of the 

22 United States, for the purpose of satisfying the ap23 plicable training and instruction requirements under 

24 such qualified apprenticeship program. 


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1 ‘‘(c) QUALIFIED APPRENTICESHIP PROGRAM AND

2 QUALIFIED MULTI-EMPLOYER APPRENTICESHIP PRO3 GRAM.— 

4 ‘‘(1) QUALIFIED APPRENTICESHIP PROGRAM.— 

5 ‘‘(A) IN GENERAL.—For purposes of this 

6 section, the term ‘qualified apprenticeship pro7 gram’ means a program registered under the 

8 National Apprenticeship Act, whether or not 

9 such program is sponsored by an employer, 

10 which— 

11 ‘‘(i) provides qualified individuals with 

12 on-the-job training and instruction for a 

13 qualified occupation with the employer, 

14 ‘‘(ii) is registered with the Office of 

15 Apprenticeship of the Employment and 

16 Training Administration of the Depart17 ment of Labor or a State apprenticeship 

18 agency recognized by such Office of Ap19 prenticeship, 

20 ‘‘(iii) maintains records relating to the 

21 qualified individual, in such manner as the 

22 Secretary, after consultation with the Sec23 retary of Labor, may prescribe, and 


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1 ‘‘(iv) satisfies such other requirements 

2 as the Secretary, after consultation with 

3 the Secretary of Labor, may prescribe. 

4 ‘‘(B) QUALIFIED OCCUPATION.—For pur5 poses of subparagraph (A)(i), the term ‘quali6 fied occupation’ means a skilled trade occupa7 tion in a high-demand mechanical, technical, 

8 healthcare, or technology field (or such other 

9 occupational field as the Secretary, after con10 sultation with the Secretary of Labor, may pre11 scribe) that satisfies the criteria for an 

12 apprenticeable occupation under the National 

13 Apprenticeship Act. 

14 ‘‘(2) QUALIFIED MULTI-EMPLOYER APPREN15 TICESHIP PROGRAM.—The term ‘qualified multi-em16 ployer apprenticeship program’ means an apprentice17 ship program described in paragraph (1) in which 

18 multiple employers are required to contribute and 

19 that is maintained pursuant to one or more collective 

20 bargaining agreements between one or more em21 ployee organizations and such employers. 

22 ‘‘(d) APPRENTICESHIP AGREEMENT.— 

23 ‘‘(1) IN GENERAL.—For purposes of this sec24 tion, the term ‘apprenticeship agreement’ means an 

25 agreement between a qualified individual and an emVerDate Sep 11 2014 20:12 Jun 26, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H3368.IH H3368

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1 ployer that satisfies the criteria under the National 

2 Apprenticeship Act. 

3 ‘‘(2) CREDIT FOR TRAINING RECEIVED UNDER

4 APPRENTICESHIP AGREEMENT.—If a qualified indi5 vidual has received training or instruction through a 

6 qualified apprenticeship program or a qualified 

7 multi-employer apprenticeship program with an em8 ployer which is subsequently unable to satisfy its ob9 ligations under the apprenticeship agreement, such 

10 individual may transfer any completed training or 

11 instruction for purposes of satisfying any applicable 

12 training and instruction requirements under a sepa13 rate apprenticeship agreement with a different em14 ployer. 

15 ‘‘(e) APPLICATION OF CERTAIN RULES.—For pur16 poses of this section, all persons treated as a single em17 ployer under subsection (a) or (b) of section 52, or sub18 sections (m) or (o) of section 414, shall be treated as a 

19 single person. 

20 ‘‘(f) REGULATIONS.—The Secretary shall prescribe 

21 such regulations as may be necessary to carry out the pro22 visions of this section.’’. 

23 (b) CREDIT TO BE PART OF GENERAL BUSINESS

24 CREDIT.—Section 38(b) of the Internal Revenue Code of 

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1 graph (31), by striking the period at the end of paragraph 

2 (32) and inserting ‘‘, plus’’, and by adding at the end the 

3 following new paragraph: 

4 ‘‘(33) the apprenticeship program expenses 

5 credit determined under section 45T(a).’’. 

6 (c) CLERICAL AMENDMENT.—The table of sections 

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

8 of the Internal Revenue Code of 1986 is amended by add9 ing at the end the following new item: 

‘‘Sec. 45T. Credit for apprenticeship program expenses.’’. 

10 (d) CONFORMING AMENDMENTS.— 

11 (1) RULE FOR EMPLOYMENT CREDITS.—Sec12 tion 280C(a) of the Internal Revenue Code of 1986 

13 is amended by inserting ‘‘45T(a),’’ after ‘‘45S(a),’’. 

14 (2) EXCLUSION FOR DETERMINATION OF CRED15 IT FOR INCREASING RESEARCH ACTIVITIES.—Clause 

16 (iii) of section 41(b)(2)(D) of such Code is amended 

17 by inserting ‘‘the apprenticeship program credit 

18 under section 45T(a) or’’ after ‘‘in determining’’. 

19 (e) EVALUATION.—Not later than 3 years after the 

20 date of the enactment of this Act, and annually thereafter, 

21 the Comptroller General of the United States shall submit 

22 a report to the Committees on Finance and Health, Edu23 cation, Labor, and Pensions of the Senate and the Com24 mittees on Ways and Means and Education and Labor of 


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1 the House of Representatives that contains an evaluation 

2 of the activities authorized under this Act, including— 

3 (1) the extent to which qualified individuals 

4 completed qualified apprenticeship programs and 

5 qualified multi-employer apprenticeship programs; 

6 (2) whether qualified individuals remained em7 ployed by an employer that received an apprentice8 ship program credit under section 45T of the Inter9 nal Revenue Code of 1986 and the length of such 

10 employment following expiration of the apprentice11 ship period; 

12 (3) whether qualified individuals who completed 

13 a qualified apprenticeship program or a qualified 

14 multi-employer apprenticeship program remained 

15 employed in the same occupation or field; and 

16 (4) recommendations for legislative and admin17 istrative actions to improve the effectiveness of the 

18 apprenticeship program credit under section 45T of 

19 the Internal Revenue Code of 1986. 

20 (f) EFFECTIVE DATE.—The amendments made by 

21 this section shall apply to taxable years beginning after 

22 December 31, 2019. 


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1 SEC. 3. ENCOURAGING MENTORS TO TRAIN THE FUTURE. 

2 (a) EARLY DISTRIBUTIONS FROM QUALIFIED RE3 TIREMENT PLANS.—Section 72(t)(2) of the Internal Rev4 enue Code of 1986 is amended— 

5 (1) in subparagraph (A)— 

6 (A) by striking ‘‘or’’ at the end of clause 

7 (vii); 

8 (B) by striking the period at the end of 

9 clause (viii) and inserting ‘‘, or’’; and 

10 (C) by adding at the end the following new 

11 clause: 

12 ‘‘(ix) made to an employee who is 

13 serving as a mentor.’’; and 

14 (2) by adding at the end the following new sub15 paragraph: 

16 ‘‘(H) DISTRIBUTIONS TO MENTORS.—For 

17 purposes of this paragraph, the term ‘mentor’ 

18 means an individual who— 

19 ‘‘(i) has attained 55 years of age, 

20 ‘‘(ii) is not separated from their em21 ployment with a company, corporation, or 

22 institution of higher education, 

23 ‘‘(iii) in accordance with such require24 ments and standards as the Secretary de25 termines to be necessary, has substantially 

26 reduced their hours of employment with 


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1 their employer, with the individual to be 

2 engaged in mentoring activities described 

3 in clause (iv) for not less than 20 percent 

4 of the hours of employment after such re5 duction, and 

6 ‘‘(iv) is responsible for the training 

7 and education of employees or students in 

8 an area of expertise for which the indi9 vidual has a professional credential, certifi10 cate, or degree.’’. 

11 (b) DISTRIBUTIONS DURING WORKING RETIRE12 MENT.—Paragraph (36) of section 401(a) of the Internal 

13 Revenue Code of 1986 is amended to read as follows: 

14 ‘‘(36) DISTRIBUTIONS DURING WORKING RE15 TIREMENT.— 

16 ‘‘(A) IN GENERAL.—A trust forming part 

17 of a pension plan shall not be treated as failing 

18 to constitute a qualified trust under this section 

19 solely because the plan provides that a distribu20 tion may be made from such trust to an em21 ployee who— 

22 ‘‘(i) has attained age 62 and who is 

23 not separated from employment at the 

24 time of such distribution, or 


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1 ‘‘(ii) subject to subparagraph (B), is 

2 serving as a mentor (as such term is de3 fined in section 72(t)(2)(H)). 

4 ‘‘(B) LIMITATION ON DISTRIBUTIONS TO

5 MENTORS.—For purposes of subparagraph 

6 (A)(ii), the amount of the distribution made to 

7 an employee who is serving as a mentor shall 

8 not be greater than the amount equal to the 

9 product obtained by multiplying— 

10 ‘‘(i) the amount of the distribution 

11 that would have been payable to the em12 ployee if such employee had separated 

13 from employment instead of reducing their 

14 hours of employment with their employer 

15 and engaging in mentoring activities, in ac16 cordance with clauses (iii) and (iv) of sec17 tion 72(t)(2)(H), by 

18 ‘‘(ii) the percentage equal to the 

19 quotient obtained by dividing— 

20 ‘‘(I) the sum of— 

21 ‘‘(aa) the number of hours 

22 per pay period by which the em23 ployee’s hours of employment are 

24 reduced, and 


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1 ‘‘(bb) the number of hours 

2 of employment that such em3 ployee is engaging in mentoring 

4 activities, by 

5 ‘‘(II) the total number of hours 

6 per pay period worked by the em7 ployee before such reduction in hours 

8 of employment.’’. 

9 (c) EMPLOYEE RETIREMENT INCOME SECURITY ACT

10 OF 1974.—Subparagraph (A) of section 3(2) of the Em11 ployee Retirement Income Security Act of 1974 (29 

12 U.S.C. 1002(2)) is amended by striking the period at the 

13 end and inserting the following: ‘‘, or solely because such 

14 distribution is made to an employee who is serving as a 

15 mentor (as such term is defined in section 72(t)(2)(H) of 

16 the Internal Revenue Code of 1986).’’. 

17 (d) APPLICATION.—The amendments made by this 

18 section shall apply to distributions made in taxable years 

19 beginning after December 31, 2019. 

Æ 


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