I 

117TH CONGRESS 

1ST SESSION H. R. 2984 

To amend the Internal Revenue Code of 1986 to provide a credit for 

employer-provided worker training. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 4, 2021 

Mr. KRISHNAMOORTHI (for himself, Mr. VAN DREW, Mr. MEUSER, Mr. 

EMMER, Ms. SPANBERGER, Ms. WILD, and Mrs. AXNE) 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 amend the Internal Revenue Code of 1986 to provide 

a credit for employer-provided worker training. 

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 ‘‘Investing in American 

5 Workers Act’’. 

6 SEC. 2. EMPLOYER-PROVIDED WORKER TRAINING CREDIT. 

7 (a) IN GENERAL.— 


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1 (1) DETERMINATION OF CREDIT.—Subpart D 

2 of part IV of subchapter A of chapter 1 of the Inter3 nal Revenue Code of 1986 is amended by adding at 

4 the end the following new section: 

5 ‘‘SEC. 45U. EMPLOYER-PROVIDED WORKER TRAINING 

6 CREDIT. 

7 ‘‘(a) IN GENERAL.—For purposes of section 38, the 

8 employer-provided worker training credit under this sec9 tion for the taxable year is an amount equal to 20 percent 

10 of the excess (if any) of— 

11 ‘‘(1) the qualified training expenditures for the 

12 taxable year, over 

13 ‘‘(2) the average of the adjusted qualified train14 ing expenditures for the 3 taxable years preceding 

15 the taxable year for which the credit is being deter16 mined. 

17 ‘‘(b) QUALIFIED TRAINING EXPENDITURES.—For 

18 purposes of this section— 

19 ‘‘(1) IN GENERAL.—The term ‘qualified train20 ing expenditures’ means any expenditures for the 

21 qualified training of any non-highly compensated 

22 employee. Such term shall not include any amounts 

23 paid for meals, lodging, transportation, or other 

24 services incidental to such qualified training. 

25 ‘‘(2) QUALIFIED TRAINING.— 


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1 ‘‘(A) IN GENERAL.—For purposes of para2 graph (1), the term ‘qualified training’ means 

3 training which results in the attainment of a 

4 recognized postsecondary credential and which 

5 is provided through— 

6 ‘‘(i) an apprenticeship program reg7 istered under the Act of August 16, 1937 

8 (commonly known as the ‘National Ap9 prenticeship Act’; 50 Stat. 664, chapter 

10 663; 29 U.S.C. 50 et seq.); 

11 ‘‘(ii)(I) a program of training services 

12 which is listed under section 122(d) of the 

13 Workforce Innovation and Opportunity Act 

14 (29 U.S.C. 3152(d)), or 

15 ‘‘(II) an apprenticeship program 

16 which is registered or approved by a recog17 nized State apprenticeship agency (which 

18 uses a State apprenticeship council) in ac19 cordance with section 1 of the Act referred 

20 to in clause (i), 

21 ‘‘(iii) a program which is conducted 

22 by an area career and technical education 

23 school, a community college, or a labor or24 ganization, or 


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1 ‘‘(iv) a program which is sponsored 

2 and administered by an employer, industry 

3 trade association, industry or sector part4 nership, or labor organization. 

5 ‘‘(B) RELATED DEFINITIONS.—In sub6 paragraph (A): 

7 ‘‘(i) AREA CAREER AND TECHNICAL

8 EDUCATION SCHOOL.—The term ‘area ca9 reer and technical education school’ means 

10 such a school, as defined in section 3 of 

11 the Carl D. Perkins Career and Technical 

12 Education Act of 2006 (20 U.S.C. 2302), 

13 which participates in a program under that 

14 Act (20 U.S.C. 2301 et seq.). 

15 ‘‘(ii) COMMUNITY COLLEGE.—The 

16 term ‘community college’ means an institu17 tion which— 

18 ‘‘(I) is a junior or community col19 lege as defined in section 312(f) of the 

20 Higher Education Act of 1965 (20 

21 U.S.C. 1058(f)), except that the insti22 tution need not meet the requirements 

23 of paragraph (1) of that section, and 


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1 ‘‘(II) participates in a program 

2 under title IV of that Act (20 U.S.C. 

3 1070 et seq.). 

4 ‘‘(iii) INDUSTRY OR SECTOR PARTNER5 SHIP.—The term ‘industry or sector part6 nership’ has the meaning given such term 

7 under section 3 of the Workforce Innova8 tion and Opportunity Act (29 U.S.C. 

9 3102). 

10 ‘‘(iv) INDUSTRY TRADE ASSOCIA11 TION.—The term ‘industry trade associa12 tion’ means an organization which— 

13 ‘‘(I) is described in paragraph (3) 

14 or (6) of section 501(c) of the Inter15 nal Revenue Code of 1986 and exempt 

16 from taxation under section 501(a) of 

17 such Code, and 

18 ‘‘(II) is representing an industry. 

19 ‘‘(v) LABOR ORGANIZATION.—The 

20 term ‘labor organization’ means a labor or21 ganization, within the meaning of the term 

22 in section 501(c)(5) of the Internal Rev23 enue Code of 1986. 

24 ‘‘(vi) RECOGNIZED POSTSECONDARY

25 CREDENTIAL.—The term ‘recognized postVerDate Sep 11 2014 00:03 Jun 19, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H2984.IH H2984

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1 secondary credential’ means a credential 

2 consisting of an industry-recognized certifi3 cate or certification, a certificate of com4 pletion of an apprenticeship, a license rec5 ognized by the State involved or Federal 

6 Government, or an associate or bacca7 laureate degree. 

8 ‘‘(3) NON-HIGHLY COMPENSATED EMPLOYEE.— 

9 For purposes of paragraph (1), the term ‘non-highly 

10 compensated employee’ means an employee of the 

11 taxpayer whose remuneration for the taxable year 

12 for services provided to the taxpayer does not exceed 

13 $82,000. 

14 ‘‘(c) ADJUSTED QUALIFIED TRAINING EXPENDI15 TURES.—For purposes of this section, the term ‘adjusted 

16 qualified training expenses’ means, with respect to any 

17 taxable year— 

18 ‘‘(1) the qualified training expenses for such 

19 taxable year, multiplied by 

20 ‘‘(2) the cost-of-living adjustment determined 

21 under section 1(f)(3) for the calendar year in which 

22 the taxable year for which the credit is being deter23 mined begins, except that section 1(f)(3)(A)(ii) shall 

24 be applied by using the CPI for the calendar year 

25 in which the taxable year in which qualified training 


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1 expenses were paid or incurred begins in lieu of the 

2 CPI for calendar year 1982. 

3 ‘‘(d) SPECIAL RULES.—For purposes of this sec4 tion— 

5 ‘‘(1) SPECIAL RULE IN CASE OF NO QUALIFIED

6 TRAINING EXPENDITURES IN ANY OF 3 PRECEDING

7 TAXABLE YEARS.— 

8 ‘‘(A) TAXPAYERS TO WHICH PARAGRAPH

9 APPLIES.—The credit under this section shall 

10 be determined under this paragraph if the tax11 payer has no qualified training expenditures in 

12 any one of the 3 taxable years preceding the 

13 taxable year for which the credit is being deter14 mined. 

15 ‘‘(B) CREDIT RATE.—The credit deter16 mined under this paragraph shall be equal to 

17 10 percent of the adjusted qualified training ex18 penditures for the taxable year. 

19 ‘‘(2) AGGREGATION AND ALLOCATION OF EX20 PENDITURES, ETC.—Rules similar to the rules of 

21 paragraphs (1), (2), (3), (4), and (5) of section 

22 41(f) shall apply. 

23 ‘‘(e) ELECTION TO APPLY CREDIT AGAINST PAY24 ROLL TAXES.— 


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1 ‘‘(1) IN GENERAL.—At the election of a quali2 fied small business or a qualified tax-exempt organi3 zation (as defined in section 3111(e)(5)(A)) for any 

4 taxable year, section 3111(g) shall apply to the pay5 roll tax credit portion of the credit otherwise deter6 mined under subsection (a) for the taxable year and 

7 such portion shall not be treated (other than for 

8 purposes of section 280C) as a credit determined 

9 under subsection (a). 

10 ‘‘(2) PAYROLL TAX CREDIT PORTION.—For 

11 purposes of this subsection, the payroll tax credit 

12 portion of the credit determined under subsection 

13 (a) with respect to any qualified small business or 

14 qualified tax-exempt organization for any taxable 

15 year is the least of— 

16 ‘‘(A) the amount specified in the election 

17 made under this subsection, 

18 ‘‘(B) the credit determined under sub19 section (a) for the taxable year (determined be20 fore the application of this subsection), or 

21 ‘‘(C) in the case of a qualified small busi22 ness other than a partnership or S corporation, 

23 the amount of the business credit carryforward 

24 under section 39 carried from the taxable year 


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1 (determined before the application of this sub2 section to the taxable year). 

3 ‘‘(3) QUALIFIED SMALL BUSINESS.—For pur4 poses of this subsection— 

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

6 small business’ means, with respect to any tax7 able year— 

8 ‘‘(i) a corporation or partnership if 

9 the gross receipts (as determined under the 

10 rules of section 448(c)(3), without regard 

11 to subparagraph (A) thereof) of such enti12 ty for the taxable year is less than 

13 $5,000,000, and 

14 ‘‘(ii) any person (other than a cor15 poration or partnership) who meets the re16 quirements of clause (i), determined— 

17 ‘‘(I) by substituting ‘person’ for 

18 ‘entity’, and 

19 ‘‘(II) by only taking into account 

20 the aggregate gross receipts received 

21 by such person in carrying on all 

22 trades or businesses of such person. 

23 ‘‘(B) LIMITATION.—Such term shall not 

24 include an organization which is exempt from 

25 taxation under section 501. 


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1 ‘‘(4) ELECTION.— 

2 ‘‘(A) IN GENERAL.—Any election under 

3 this subsection for any taxable year— 

4 ‘‘(i) shall specify the amount of the 

5 credit to which such election applies, 

6 ‘‘(ii) shall be made on or before the 

7 due date (including extensions) of— 

8 ‘‘(I) in the case of a partnership, 

9 the return required to be filed under 

10 section 6031, 

11 ‘‘(II) in the case of an S corpora12 tion, the return required to be filed 

13 under section 6037, and 

14 ‘‘(III) in the case of any other 

15 qualified small business or qualified 

16 tax-exempt organization, the return of 

17 tax for the taxable year, and 

18 ‘‘(iii) may be revoked only with the 

19 consent of the Secretary. 

20 ‘‘(B) LIMITATION.—The amount specified 

21 in any election made under this subsection shall 

22 not exceed $250,000. 

23 ‘‘(C) SPECIAL RULE FOR PARTNERSHIPS

24 AND S CORPORATIONS.—In the case of a part25 nership or S corporation, the election made 


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1 under this subsection shall be made at the enti2 ty level. 

3 ‘‘(5) AGGREGATION RULES.— 

4 ‘‘(A) IN GENERAL.—Except as provided in 

5 subparagraph (B)— 

6 ‘‘(i) all members of the same con7 trolled group of corporations shall be treat8 ed as a single taxpayer, and 

9 ‘‘(ii) all trades or businesses (whether 

10 or not incorporated) which are under com11 mon control shall be treated as a single 

12 taxpayer. 

13 ‘‘(B) SPECIAL RULES.—For purposes of 

14 this subsection and section 3111(g)— 

15 ‘‘(i) each of the persons treated as a 

16 single taxpayer under subparagraph (A) 

17 may separately make the election under 

18 paragraph (1) for any taxable year, and 

19 ‘‘(ii) the $250,000 amount under 

20 paragraph (3)(B) shall be allocated among 

21 all persons treated as a single taxpayer 

22 under subparagraph (A) in the manner 

23 provided by the Secretary which is similar 

24 to the manner provided under section 

25 41(f)(1). 


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1 ‘‘(6) REGULATIONS.—The Secretary shall pre2 scribe such regulations as may be necessary to carry 

3 out the purposes of this subsection, including— 

4 ‘‘(A) regulations to prevent the avoidance 

5 of the purposes of the limitations and aggrega6 tion rules under this subsection, 

7 ‘‘(B) regulations to minimize compliance 

8 and recordkeeping burdens under this sub9 section, 

10 ‘‘(C) regulations for recapturing the ben11 efit of credits determined under section 3111(g) 

12 in cases where there is a recapture or a subse13 quent adjustment to the payroll tax credit por14 tion of the credit determined under subsection 

15 (a), including requiring amended income tax re16 turns in the cases where there is such an ad17 justment, and 

18 ‘‘(D) regulations for the collection of demo19 graphic information with respect to the race, 

20 ethnicity, and gender of the individuals with re21 spect to whom a taxpayer makes qualified train22 ing expenditures for which a credit is allowed 

23 under this section.’’. 

24 (2) CREDIT PART OF GENERAL BUSINESS

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


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1 Code of 1986 is amended by striking ‘‘plus’’ at the 

2 end of paragraph (32), by striking the period at the 

3 end of paragraph (33) and inserting ‘‘, plus’’, and 

4 by adding at the end the following new paragraph: 

5 ‘‘(34) the employer-provided worker training 

6 credit determined under section 45U(a).’’. 

7 (3) COORDINATION WITH DEDUCTIONS.—Sec8 tion 280C of the Internal Revenue Code of 1986 is 

9 amended by adding at the end the following new 

10 subsection: 

11 ‘‘(i) EMPLOYER-PROVIDED WORKER TRAINING

12 CREDIT.—No deduction shall be allowed for that portion 

13 of the expenses otherwise allowable as a deduction taken 

14 into account in determining the credit under section 45U 

15 for the taxable year which is equal to the amount of the 

16 credit determined for such taxable year under section 

17 45U(a).’’. 

18 (4) CLERICAL AMENDMENT.—The table of sec19 tions for subpart D of part IV of subchapter A of 

20 chapter 1 of the Internal Revenue Code of 1986 is 

21 amended by adding at the end the following new 

22 item: 

‘‘Sec. 45U. Employer-provided worker training credit.’’. 

23 (b) CREDIT ALLOWED AGAINST ALTERNATIVE MIN24 IMUM TAX.—Subparagraph (B) of section 38(c)(4) of the 

25 Internal Revenue Code of 1986 is amended— 


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1 (1) by redesignating clauses (x), (xi), and (xii) 

2 as clauses (xi), (xii), and (xiii), respectively, and 

3 (2) by inserting after clause (ix) the following 

4 new clause: 

5 ‘‘(x) the credit determined under sec6 tion 45U with respect to an eligible small 

7 business (as defined in paragraph (5)(C), 

8 after application of rules similar to the 

9 rules of paragraph (5)(D)),’’. 

10 (c) PAYROLL TAX CREDIT.—Section 3111 of the In11 ternal Revenue Code of 1986 is amended by adding at the 

12 end the following new subsection: 

13 ‘‘(g) CREDIT FOR WORKER TRAINING EXPENSES.— 

14 ‘‘(1) IN GENERAL.—In the case of a taxpayer 

15 who has made an election under section 45U(e) for 

16 a taxable year, there shall be allowed as a credit 

17 against the tax imposed by subsection (a) for the 

18 first calendar quarter which begins after the date on 

19 which the taxpayer files the return specified in sec20 tion 45U(e)(4)(A)(ii) an amount equal to the payroll 

21 tax credit portion determined under section 

22 45U(e)(2). 

23 ‘‘(2) LIMITATION.—The credit allowed by para24 graph (1) shall not exceed the tax imposed by sub25 section (a) for any calendar quarter on the wages 


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1 paid with respect to the employment of all individ2 uals in the employ of the employer. 

3 ‘‘(3) CARRYOVER OF UNUSED CREDIT.—If the 

4 amount of the credit under paragraph (1) exceeds 

5 the limitation of paragraph (2) for any calendar 

6 quarter, such excess shall be carried to the suc7 ceeding calendar quarter and allowed as a credit 

8 under paragraph (1) for such quarter. 

9 ‘‘(4) DEDUCTION ALLOWED FOR CREDITED

10 AMOUNTS.—The credit allowed under paragraph (1) 

11 shall not be taken into account for purposes of de12 termining the amount of any deduction allowed 

13 under chapter 1 for taxes imposed under subsection 

14 (a).’’. 

15 (d) SIMPLIFIED FILING FOR CERTAIN SMALL BUSI16 NESSES.—The Secretary of the Treasury, in consultation 

17 with the Administrator of the Small Business Administra18 tion, shall provide for a method of filing returns of tax 

19 and information returns required under the Internal Rev20 enue Code of 1986 in a simplified format, to the extent 

21 possible, for employers with less than $5,000,000 in an22 nual gross receipts (as determined under guidance pro23 vided by the Secretary). 

24 (e) REGULATIONS RELATING TO POSTSECONDARY

25 CREDENTIALS.—Not later than 1 year after the date of 


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1 the enactment of this Act, the Secretary of Labor, in con2 sultation with the Secretary of the Treasury, shall issue 

3 regulations or other guidance applying the definition of 

4 the term ‘‘recognized postsecondary credential’’ as pro5 vided in section 3 of the Workforce Innovation and Oppor6 tunity Act (29 U.S.C. 3102). 

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

8 this section shall apply to taxable years beginning after 

9 the date of the enactment of this Act. 

Æ 


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