Bill Text: CT HB05395 | 2016 | General Assembly | Comm Sub

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Bill Title: An Act Establishing A Tax Credit For Businesses That Hire Recent Graduates Of Institutions Of Higher Education Located In Connecticut.

Spectrum: Committee Bill

Status: (Introduced - Dead) 2016-03-16 - Favorable Change of Reference, Senate to Committee on Finance, Revenue and Bonding [HB05395 Detail]

Download: Connecticut-2016-HB05395-Comm_Sub.html

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General Assembly		Raised Bill No. 5395
February Session, 2016		LCO No. 1718
		*_____HB05395HSGFIN031016____*
Referred to Committee on HOUSING
Introduced by:
(HSG)

AN ACT ESTABLISHING A TAX CREDIT FOR BUSINESSES THAT HIRE RECENT GRADUATES OF INSTITUTIONS OF HIGHER EDUCATION LOCATED IN CONNECTICUT.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (Effective January 1, 2018, and applicable to income or taxable years commencing on or after said date) (a) As used in this section:

(1) "Commissioner" means the Commissioner of Economic and Community Development;

(2) "Control", with respect to a corporation, means ownership, directly or indirectly, of stock possessing fifty per cent or more of the total combined voting power of all classes of the stock of such corporation entitled to vote. "Control", with respect to a trust, means ownership, directly or indirectly, of fifty per cent or more of the beneficial interest in the principal or income of such trust. The ownership of stock in a corporation, of a capital or profits interest in a partnership, limited liability company or association or of a beneficial interest in a trust shall be determined in accordance with the rules for constructive ownership of stock provided in Section 267(c) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as from time to time amended, other than paragraph (3) of said Section 267(c);

(3) "Full-time job" means a job in which an employee is required to work at least thirty-five hours per week for not less than forty-eight weeks in a calendar year. "Full-time job" does not include a temporary or seasonal job;

(4) "Income year" means, with respect to entities subject to the insurance premiums tax under chapter 207 of the general statutes, the corporation business tax under chapter 208 of the general statutes, the utility companies tax under chapter 212 of the general statutes or the income tax under chapter 229 of the general statutes, the income or taxable year as determined under each of said chapters, as the case may be;

(5) "New employee" means a person who resides in this state and is hired by a taxpayer on or after January 1, 2018, to fill a new job. "New employee" does not include a person who was employed in this state by a related person with respect to a taxpayer during the prior twelve months;

(6) "New job" means a job that did not exist in this state prior to a taxpayer's application to the commissioner for certification under this section for a recent graduate tax credit, is filled by a qualifying employee, and is a full-time job;

(7) "Qualifying employee" means a new employee who, at the time of hiring by the taxpayer has graduated within the prior three years from a public or private institution of higher education that is located in this state;

(8) "Related person" means (A) a corporation, limited liability company, partnership, association or trust controlled by the taxpayer, (B) an individual, corporation, limited liability company, partnership, association or trust that is in control of the taxpayer, (C) a corporation, limited liability company, partnership, association or trust controlled by an individual, corporation, limited liability company, partnership, association or trust that is in control of the taxpayer, or (D) a member of the same controlled group as the taxpayer; and

(9) "Taxpayer" means a person that (A) has been in business for at least twelve consecutive months prior to the date of the taxpayer's application to the commissioner for certification under this section for a recent graduate tax credit, and (B) is subject to tax under chapter 208 of the general statutes or chapter 207, 212 or 229 of the general statutes.

(b) (1) There is established a recent graduate tax credit program under which a taxpayer may be allowed a credit against the tax imposed under chapter 208 of the general statutes or chapter 207, 212 or 229 of the general statutes, other than the liability imposed by section 12-707 of the general statutes, for each qualifying employee hired on or after January 1, 2018. For taxpayers that employ not more than fifty employees in full-time jobs in this state on the date of application to the commissioner for certification under this section, the creation of at least one new job in this state shall be required for the tax credit. For taxpayers that employ more than fifty, but not more than one hundred employees in full-time jobs in this state on the date of application to the commissioner for certification under this section, the creation of at least five new jobs in this state shall be required for the tax credit. For taxpayers that employ more than one hundred employees in full-time jobs in this state on the date of application to the commissioner for certification under this section, the creation of at least ten new jobs in this state shall be required for the tax credit.

(2) For the purposes of determining the number of new jobs a taxpayer is required to create in order to claim a credit under this section, the number of employees working in full-time jobs the taxpayer employs in this state on the date of its application to the commissioner for certification under this section shall apply to such taxpayer for the duration of such certification.

(c) The amount of the credit shall be five hundred dollars per month for each new employee.

(d) (1) The taxpayer shall claim the credit in the income year in which it is earned. Any credit not claimed by the taxpayer in such income year shall expire and shall not be refundable.

(2) If the taxpayer is an S corporation or an entity treated as a partnership for federal income tax purposes, the shareholders or partners of such taxpayer may claim the credit. If the taxpayer is a single member limited liability company that is disregarded as an entity separate from its owner, the limited liability company's owner may claim the credit.

(3) No taxpayer shall claim a credit for any qualifying employee who is an owner, member or partner in the business or who is not employed by the taxpayer at the close of the taxpayer's income year.

(4) No taxpayer claiming the credit under this section with respect to a qualifying employee shall claim any credit against any tax under any other provision of the general statutes with respect to the same qualifying employee.

(e) (1) To be eligible to claim a credit under this section, a taxpayer shall apply to the commissioner in accordance with this section. The application shall be on a form provided by the commissioner and shall contain sufficient information as required by the commissioner, including, but not limited to, the activities that the taxpayer primarily engages in, the North American Industrial Classification System code of the taxpayer, the current number of employees employed by the taxpayer as of the application date, and if applicable, the name and position or job title of the qualifying employee. The commissioner may impose an application fee as the commissioner deems appropriate.

(2) Upon receipt of an application, the commissioner shall render a decision, in writing, on each completed application not later than thirty days after the date the commissioner receives the application. If the commissioner approves the application, the commissioner shall issue a certification letter to the taxpayer indicating that the credit will be available to be claimed by the taxpayer if the taxpayer and the qualifying employee otherwise meet the requirements of this section.

(f) The total amount of credits granted under this section shall not exceed one million dollars in any one fiscal year.

(g) No credit allowed under this section shall exceed the amount of tax imposed on a taxpayer under chapter 208 of the general statutes or chapter 207, 212 or 229 of the general statutes. The commissioner shall annually provide to the Commissioner of Revenue Services a list detailing all credits that have been approved and all taxpayers that have been issued a certification letter under this section.

This act shall take effect as follows and shall amend the following sections:
Section 1	January 1, 2018, and applicable to income or taxable years commencing on or after said date	New section

HSG

Joint Favorable C/R

FIN