I
104TH CONGRESS
1ST SESSION
H. R. 124
To amend the Internal Revenue Code of 1986 to allow a credit to employers
for the cost of providing English language training to their employees.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 4, 1995
Mr. EMERSON 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 a
credit to employers for the cost of providing English
language training to their employees.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. CREDIT FOR EXPENDITURES TO PROVIDE LAN-
GUAGE TRAINING TO EMPLOYEES.
(a) GENERAL RULE.—Subpart D of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to business related credits) is amended by
adding at the end thereof the following new section:
HR 124 IH
‘‘SEC. 45A. EXPENDITURES TO PROVIDE LANGUAGE TRAIN-
ING TO EMPLOYEES.
‘‘(a) GENERAL RULE.—For purposes of section 38,
the amount of the language training credit determined
under this section for the taxable year is 50 percent of
the qualified language training expenses paid or incurred
by the taxpayer during the taxable year.
‘‘(b) QUALIFIED LANGUAGE TRAINING EXPENSES.—
For purposes of this section—
‘‘(1) IN GENERAL.—Except as otherwise pro-
vided in this subsection, the term ‘qualified language
training expenses’ means—
‘‘(A) amounts paid or incurred by the tax-
payer with respect to expenses incurred by or
on behalf of an employee for qualified language
training of such employee (including but not
limited to tuition, fees, and similar payments,
books and supplies); and
‘‘(B) the following expenses paid or in-
curred by the taxpayer—
‘‘(i) wages (as defined in section
41(b)(2)(D)) paid or incurred by the tax-
payer to an employee for services consist-
ing of providing qualified language training
to employees of the taxpayer, and
HR 124 IH
‘‘(ii) expenses of books and supplies
used in connection with the provision of
such training; and
‘‘(C) wages (as so defined) paid to any em-
ployee receiving qualified language training to
the extent allocable to the time when such em-
ployee is receiving such training.
‘‘(2) ONLY
DOMESTIC
EMPLOYMENT
QUALI-
FIED.—Amounts may be taken into account under
paragraph (1) with respect to any employee receiv-
ing qualified language training only if substantially
all of the services performed by such employee dur-
ing the taxable year for the taxpayer are performed
in the United States or any possession of the United
States.
‘‘(c) QUALIFIED LANGUAGE TRAINING.—For pur-
poses of this section, the term ‘qualified language training’
means—‘‘(1) training in English language and literacy to
individuals with limited English proficiency, and ‘‘(2) re-
medial training in English language and literacy.’’
(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 (7),
by striking the period at the end of paragraph (8) and
HR 124 IH
inserting ‘‘, plus’’, and by adding at the end thereof the
following new paragraph:
‘‘(9) the language training credit determined
under section 45A(a).’’
(c) DENIAL OF DOUBLE BENEFIT.—Section 280C of
such Code is amended by adding at the end thereof the
following new subsection:
‘‘(d) CREDIT
FOR LITERACY ENHANCEMENT EX-
PENSES.—No deduction shall be allowed for that portion
of the qualified literacy education expenses (as defined in
section 45A(b)) 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 45A(a).’’
(d) CREDIT ALLOWABLE AGAINST MINIMUM TAX.—
Subsection (c) of section 38 of such Code is amended by
redesignating paragraph (2) as paragraph (3) and by in-
serting after paragraph (1) the following new paragraph:
‘‘(2) LANGUAGE
TRAINING
CREDIT
ALLOWED
AGAINST MINIMUM TAX.—
‘‘(A) IN
GENERAL.—The amount deter-
mined under paragraph (1)(A) shall be reduced
by the portion of the language training credit
not used against the normal limitation.
‘‘(B) PORTION
OF
LANGUAGE
TRAINING
CREDIT NOT USED AGAINST NORMAL LIMITA-
HR 124 IH
TION.—For purposes of subparagraph (A), the
portion of the language training credit not used
against the normal limitation is the excess (if
any) of—
‘‘(i) the portion of the credit allowable
under subsection (a) which is attributable
to the language training credit, over
‘‘(ii) the limitation of paragraph (1)
(determined without regard to this para-
graph) reduced by the portion of the credit
under subsection (a) which is not so attrib-
utable.’’
(e) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
the date of the enactment of this Act.
Æ