Section 38HH: Credit for wages paid to qualified apprentice
[ Text of section effective for tax years beginning after January 1, 2019. See 2018, 228, Sec. 72.]
[ Subsection (a) effective until January 2, 2024. For text effective January 2, 2024, see below.]
Section 38HH. (a) A business corporation engaged in business in the commonwealth shall be allowed a credit against its excise due under this chapter in an amount equal to $4,800 or 50 per cent of the wages paid to each qualified apprentice in a taxable year, whichever is less. If a credit allowed by this section exceeds the tax otherwise due under this chapter, 100 per cent of the balance of such credit may, at the option of the taxpayer, be refundable to the taxpayer. In order to qualify, the apprentice must meet the definition of apprentice in section 11H of chapter 23 and must be hired and trained in 1 of the following occupations, as defined by the Bureau of Labor Statistics: computer occupations, as defined by Standard Occupational Codes 15-1200; health technologists and technicians, as defined by Standard Occupational Codes 29-2000; health practitioner support technologists and technicians, as defined by Standard Occupational Codes 29-2050; healthcare support occupations, as defined by Standard Occupational Codes 31-0000; or production occupations if employed in the manufacturing industry, as defined by Standard Occupational Codes 51-0000, NAICS code 31-33.
[ Subsection (a) as amended by 2023, 50, Sec. 34 effective January 2, 2024 for taxable years beginning on or after January 1, 2023. See 2023, 50 Sec. 49. For text effective until January 2, 2024, see above.]
(a) A business corporation engaged in business in the commonwealth shall be allowed a credit against its excise due under this chapter in an amount equal to $4,800 or 50 per cent of the wages paid to each qualified apprentice in a taxable year, whichever is less. If a credit allowed by this section exceeds the tax otherwise due under this chapter, 100 per cent of the balance of such credit may, at the option of the taxpayer, be refundable to the taxpayer. In order to qualify, the apprentice must meet the definition of apprentice in section 11H of chapter 23 and must be hired and trained in 1 of the following occupations, as defined by the Bureau of Labor Statistics: computer occupations, as defined by Standard Occupational Codes 15-1200; health technologists and technicians, as defined by Standard Occupational Codes 29-2000; health practitioner support technologists and technicians, as defined by Standard Occupational Codes 29-2050; healthcare support occupations, as defined by Standard Occupational Codes 31-0000; or production occupations if employed in the manufacturing industry, as defined by Standard Occupational Codes 51-0000, NAICS code 31-33 or other expansion industries the secretary of labor and workforce development identifies as critical to a regional labor market economy.
(b) To be eligible for a credit under this section: (i) the primary place of employment of the apprentice must be in the commonwealth; (ii) the business corporation must be registered with the division of apprentice standards as an apprenticeship program sponsor and have an apprentice agreement, as defined in section 11H of chapter 23, with each apprentice for whom the credit is claimed; and (iii) the apprentice must have been employed by the business corporation as an apprentice for at least 180 calendar days in the taxable year in which the credit is claimed.
(c) A business corporation that is eligible for and claims the credit allowed under this section in a taxable year with respect to a qualified apprentice shall be eligible for a credit in the subsequent taxable year with respect to such qualified apprentice, subject to certification by the division of apprentice standards of continued employment as an apprentice during the subsequent taxable year in the manner required by the commissioner. Any credit allowed under this section shall not be transferable.
(d) The secretary of labor and workforce development, in consultation with the commissioner, shall promulgate regulations establishing an application process for the credit; provided, however, that the regulations shall include a maximum number of qualified apprentices for which a taxpayer may claim the credit in a year.
(e) The secretaries of labor and workforce development and administration and finance, acting jointly and in writing shall authorize tax credits pursuant to this section and subsection (v) of section 6 of chapter 62. The total amount of credits that may be authorized in a calendar year pursuant to this section and said subsection (v) of said section 6 of said chapter 62 shall not exceed $2,500,000. No credits shall be allowed under this section except to the extent authorized in this subsection. The commissioner, after consulting with the secretaries, on the criteria set forth in subsections (a) and (b) of this section, shall adopt regulations governing applications for and other administration of the tax credits. The secretaries and the division of apprentice standards shall provide the commissioner with the documentation that the commissioner deems necessary to confirm compliance with the annual cap.
(f) The commissioner, in consultation with the secretaries, shall annually, not later than March 1, file a report with the house and senate committees on ways and means, the joint committee on economic development and emerging technologies, and the joint committee on labor and workforce development, identifying the following: (i) total amount of tax credits claimed pursuant to this subsection; (ii) the number of participating apprentices and relevant wage information; (iii) the number of applications received and the number of participating employers; (iv) the areas of occupation by qualifying tax credit beneficiaries; (v) program outcomes for apprentices, including job retention and further employment opportunities; and (vi) whether the tax credit program is achieving its public policy purpose to create talent pipelines for businesses and provide career pathways toward high demand occupations for unemployed and underemployed residents of the commonwealth.