ACCA floats creation of tax credit for contractors with in-house training programs

Based on approximately 1,100 comments from contractors, ACCA has landed on four main policy priorities for the next two years, including a focus on strengthening the labor force. 

What’s happening: Within its ‘workforce’ priority, one solution calls for Congress to establish a new tax incentive for contractors who provide in-house training.  

• An existing credit —  the ‘Work Opportunity Tax Credit’ — incentivizes the hiring and training of certain individuals, including veterans, ex-felons, and those with disabilities, providing businesses with between $1,200 and $9,600 per eligible employee.
• Yes, but: A similar credit could be established to cover training for a wider range of people, regardless of their backgrounds, Sean Robertson, ACCA’s VP of Advocacy, tells Homepros in an email. 

The big picture: “At this point it’s just a concept built around the simple notion that government supported schools and apprenticeship programs aren’t keeping up with the demand for skilled tradespeople,” Robertson writes. 

Why it matters: While a swath of contractors nationwide have developed their own paid, in-house training programs, they often come at a substantial expense. 

• “They’re fulfilling a public need with no guarantee that these workers will stick around after graduation,” Robertson says. “Congress should act to ensure that the tax code supports these investments, just as government currently invests in trade schools and registered apprenticeships.” 

What we’re watching: Several members of Congress have introduced bills aimed at enhancing tax credits for apprenticeships and trade schools, “but none of these is as broadly applicable as we’d like,” he notes, “and we’re talking to friends in Congress about how a broader incentive could be structured.”

• “For example, a tax credit could help subsidize wages paid during a training program, reimburse certain program expenses, or reward certain outcomes upon graduation,” he adds. 
• “Ultimately, we may pursue several strategies simultaneously, and we hope contractors will share their creative ideas with ACCA and their members of Congress.”
• While the idea has been floated, there isn’t yet a formal proposal or draft bill.