On-the-Job Training Tax Credit Act of 2017

To amend the Internal Revenue Code of 1986 to provide a credit against tax for job training expenses of employers. 1. Short title This Act may be cited as the On-the-Job Training Tax Credit Act of 2017 2. On-the-Job Training Tax Credit (a) In general Subpart D of part IV of subchapter A of chapter 1 45S. On-the-job training tax credit (a) In general For purposes of section 38, in the case of an eligible employer, the on-the-job training tax credit determined under this section with respect to any eligible employee of the employer is an amount equal to the lesser of— (1) 50 percent of the job training program expenditures of the taxpayer with respect to such employee during the taxable year, or (2) $5,000. (b) Eligible employer For purposes of this section, the term eligible employer (c) Job training program expenses For purposes of this section— (1) In general The term job training program expenses (2) Qualified training program For purposes of this subsection, the term qualified training program (A) An apprenticeship program registered and certified with the Secretary of Labor under section 1 of the National Apprenticeship Act ( 29 U.S.C. 50 (B) A program licensed, registered, or certified by the workforce investment board or apprenticeship agency or council of a State or administered in compliance with apprenticeship laws of a State. (C) A program conducted by a vocational or technical education school, community college, industrial or trade training organization, or labor organization. (D) A program which conforms to apprentice training programs developed or administered by an employer trade group or committee. (E) An industry sponsored or administered program which is clearly identified and commonly recognized. (d) Eligible employee For purposes of this section, the term eligible employee (e) Recapture of credit for employee not performing minimum service (1) In general In the case of any employee with respect to whom a credit is allowed under this section and whose employment is terminated by the employer (other than by reason of such employee’s gross misconduct) before the end of the 2-year period beginning on the first day of the employee’s study or training with respect to which a credit is allowed under this section, the tax of the taxpayer under this chapter for the taxable year during which such termination occurs shall be increased by an amount equal to— (A) the aggregate decrease in the credits allowed under section 38 for all prior taxable years which would have resulted if the job training program expenses with respect to such employee had been zero, multiplied by (B) the inclusion ratio. (2) Inclusion ratio For purposes of this subsection, the inclusion ratio is the ratio which— (A) an amount equal to the difference of— (i) the number of days in the 2-year period, over (ii) the number of days such employee was employed by the employer during such 2-year period, bears to (B) the number of days in the 2-year period. (f) Controlled groups For purposes of this section, all persons treated as a single employer under subsection (b), (c), (m), or (o) of section 414 shall be treated as a single employer. (g) Termination The section shall not apply amounts paid or incurred during taxable years beginning after December 31, 2019. . (b) Credit To be part of general business credit Subsection (b) of section 38 of such Code is amended by striking plus , plus (37) the on-the-job training tax credit determined under section 45S(a). . (c) 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. 45S. On-the-job training tax credit. . (d) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2017.

Summary: On-the-Job Training Tax Credit Act of 2017 This bill amends the Internal Revenue Code to allow employers who employ an average of not more than 500 full-time employees during the taxable year an on-the-job training tax credit equal to the lesser of: 50% of the job training program expenditures for a full-time employee participating in a qualified training program, or $5,000. A "qualified training program" is a written plan of study and training that is either: (1) an apprenticeship program registered and certified with the Department of Labor under the National Apprenticeship Act; (2) a program licensed, registered, or certified by the workforce investment board or apprenticeship agency or council of a state or administered in compliance with state apprenticeship laws; (3) a program conducted by a vocational or technical education school, community college, industrial or trade training organization, or labor organization; (4) a program that conforms to apprentice training programs developed or administered by an employer trade group or committee; or (5) an industry-sponsored or -administered program that is clearly identified and commonly recognized. The bill terminates such credit after 2019.