To amend the Internal Revenue Code of 1986 to establish a credit for certain employers of qualifying career and technical education students.
Analysis under review: This bill has generated analysis that may be too generic or incomplete. Clause-level evidence remains available below.
Summary
What This Bill Does
This bill creates a new tax credit for small businesses that employ young workers (under age 21) or workers participating in apprenticeships, community college courses, or vocational training programs related to the employer's trade. The credit equals 50% of qualified wages paid plus the cost of workers' compensation insurance for those employees, up to a maximum of $10,000 per business per year. The credit takes effect for tax years beginning after December 31, 2025.
Who Benefits and How
Small businesses receive a direct financial incentive to hire young workers and invest in workforce development through apprenticeships and vocational training. Workers under 21 and those in training programs benefit from increased job opportunities as the credit reduces the cost of employing them. Community colleges and vocational schools may see higher enrollment as the credit encourages employers to hire students from their programs.
Who Bears the Burden and How
The federal government bears the cost through reduced tax revenue from credit claims. The IRS would need to administer the new credit provision, including defining eligibility and processing claims.
Key Provisions
- Creates new Section 45U of the Internal Revenue Code for career and technical education credit
- Credit equals 50% of qualified wages plus workers' compensation insurance costs
- Maximum credit of $10,000 per taxpayer per year
- Available only to small business concerns as defined by the Small Business Act
- Qualified employees must be under 21 or enrolled in apprenticeship/vocational/community college programs
- Effective for taxable years beginning after December 31, 2025
Evidence Chain:
This summary is generated from the full bill text using AI analysis. Expand "Detailed Analysis" below for identified beneficiaries/burden bearers.
At a Glance
What This Bill Does
Creates a new tax credit (Section 45U of the Internal Revenue Code) for small businesses that hire young workers under 21 or employees enrolled in apprenticeship, community college, or vocational training programs related to the employer's business.
Key Policy Areas
Taxation, Education, Labor
Primary Purpose
Creates a new tax credit (Section 45U of the Internal Revenue Code) for small businesses that hire young workers under 21 or employees enrolled in apprenticeship, community college, or vocational training programs related to the employer's business.
Policy Domains
Career and Technical Education Tax Credit for Small Businesses
Identified Gains
Contextual inference, no direct clause citation- Small business owners who hire young or vocational workers
- Workers under 21 years old
- Apprentices and vocational training students
- Community colleges and vocational programs
Contextual inference, no direct clause citation
Identified Costs
Contextual inference, no direct clause citation- Federal tax revenue (reduced by credit claims)
- IRS (administering new credit provisions)
Contextual inference, no direct clause citation
Sponsors
Legislative Progress
IntroducedMr. Harder of California (for himself and Mrs. Kiggans of …
Impact analysis is available but no clear stakeholder effects identified. View clause-level analysis →
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
Key Definitions
Terms defined in this bill
As defined under section 3 of the Small Business Act.
An employee who is either under age 21 or is participating in a registered apprenticeship program, enrolled in a community college course related to the employer's business, or enrolled in a career training or vocational program (including high school CTE) related to the employer's business.
Amounts paid for workers' compensation insurance premiums relating to the employment of a qualified employee.
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
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