Current through Vol. 42, No. 1, September 16, 2024
(a)
General provisions. For tax
years beginning after December 31, 2008 and before January 1, 2026, three (3)
credits are allowed against the tax imposed by Section
2355
of Title 68 for the employment of qualified employees in the aerospace sector.
The three (3) credits are as follows:
(1)
Credit for qualified employers for tuition reimbursement to qualified
employees.
(2) Credit for qualified
employers for compensation paid to qualified employees.
(3) Credit for qualified
employees.
(b)
Definitions. The following words and terms, when used in this
Section, shall have the following meaning, unless the context clearly indicates
otherwise:
(1)
"Qualified
employee".
(A) Any person, regardless
of the date of hire by the qualified employer, who is newly employed by or
contracting with a qualified employer in Oklahoma on or after January 1, 2009.
(B) A person who has been either:
(i) Awarded an undergraduate or graduate
degree from a qualified program by an institution, or
(ii) Licensed as a Professional Engineer by
the State Board of Licensure for Professional Engineers and Land Surveyors
pursuant to Section
475.15
of Title 59 of the Oklahoma Statutes and employed as a qualified employee in
the aerospace sector by a qualified employer on or after November 1,
2021.
(C) Qualified
employee does not include a person employed in the aerospace sector in this
state immediately preceding employment or contracting with a qualified
employer, unless,
(i) The employee was
employed in the aerospace sector, but not as a full-time engineer, prior to
being awarded a degree, or
(ii) The
employee has been awarded a degree and is employed by a professional staffing
company and assigned to work in the aerospace sector in
Oklahoma.
(2)
"Qualified program" is any program that awards undergraduate or
graduate degrees and has been accredited by the Engineering Accreditation
Commission of the Accreditation Board for Engineering and Technology (ABET).
Effective November 1, 2021, a qualified program includes both undergraduate and
graduate programs of the same discipline of engineering at an institution if
either program is ABET accredited.
(3)
"Aerospace sector", "compensation",
"institution", "qualified employer" and "tuition" shall be
defined as in Section
2357.301
of Title 68 of the Oklahoma Statutes.
(c)
Credit for tuition
reimbursement.
(1) Qualified employers
are allowed a credit against the tax imposed pursuant to Section
2355
of Title 68 of the Oklahoma Statutes based on the amount of tuition reimbursed
to a qualified employee. This credit is effective for taxable years beginning
after December 31, 2008.
(2) The
credit for tuition reimbursement may only be claimed if the qualified employee
has been awarded an undergraduate or graduate degree within one (1) year of
starting employment with the qualified employer. The undergraduate or graduate
degree must be from a qualified program.
(3) The credit for tuition reimbursement is
equal to fifty percent (50%) of the tuition reimbursed to a qualified employee
and may be claimed for the first through fourth years of employment with the
qualified employer. The credit is only allowed to be claimed in the tax year
that the tuition was reimbursed to the qualified employee and may not exceed in
any taxable year fifty percent (50%) of the average annual amount paid by a
qualified employee for enrollment and instruction in a qualified program at a
public institution in Oklahoma.
(4)
The credit for tuition reimbursement may not be used to reduce the tax
liability of the qualified employer to less than zero (0), is not transferable
and may not be carried over.
(5)
The credit for tuition reimbursement may not be claimed after the fourth year
of employment of the qualified employee.
(d)
Credit for compensation
paid.
(1) Qualified employers are
allowed a credit against the tax imposed pursuant to Section
2355
of Title 68 of the Oklahoma Statutes for compensation paid to a qualified
employee. This credit is effective for taxable years beginning after December
31, 2008.
(2) The credit for
compensation paid equals:
(A) Ten percent
(10%) of the compensation paid for the first through fifth years of employment
in the aerospace sector if the qualified employee graduated from an institution
located in this state.
(B) Five
percent (5%) of the compensation paid for the first through fifth years of
employment in the aerospace sector if the qualified employee graduated from an
institution located outside this state.
(3) The credit for compensation paid cannot
exceed Twelve Thousand Five Hundred Dollars ($12,500.00) for each qualified
employee annually.
(4) The credit
for compensation paid may not be used to reduce the tax liability of the
qualified employer to less than zero (0), is not transferable and may not be
carried over.
(5) The credit for
compensation paid may not be claimed after the fifth year of
employment.
(e)
Credit for qualified employees.
(1) For taxable years beginning after
December 31, 2008, a qualified employee shall be allowed a credit against the
tax imposed pursuant to Section
2355
of Title 68 of the Oklahoma Statutes of up to Five Thousand Dollars ($5,000.00)
per year for a period of time not to exceed five (5) years.
(2) The credit authorized by this section
shall not be used to reduce the tax liability of the taxpayer to less than zero
(0).
(3) Any credit claimed, but
not used, may be carried over, in order, to each of the five (5) subsequent
taxable years.
Added at 26 Ok Reg
2330, eff 6-25-09; Amended at 28 Ok Reg 18, eff 8-9-10 (emergency); Amended at
28 Ok Reg 935, eff 6-1-11; Amended at 29 Ok Reg 1468, eff
6-25-12