1 STATE OF OKLAHOMA
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2 2nd Session of the 59th Legislature (2024)
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3 HOUSE BILL 3670 By: Miller
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6 AS INTRODUCED
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7 An Act relating to revenue and taxation; defining
7 terms; authorizing income tax credits for employers
8 engaged in civil engineering; providing income tax
8 credit for tuition reimbursements; providing
9 conditions for use of credit; specifying amount of
9 tax credit; prohibiting use of tax credit to reduce
10 liability to less than zero; authorizing income tax
10 credit for certain compensation paid to employees
11 engaged in civil engineering; specifying amount of
11 credit; imposing limit on credit amount; prohibiting
12 use of tax credit to reduce income tax liability to
12 less than zero; authoring income tax credit for
13 certain income received as civil engineer; providing
13 for codification; and providing an effective date.
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17 BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
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18 SECTION 1. NEW LAW A new section of law to be codified
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19 in the Oklahoma Statutes as Section 2357.321 of Title 68, unless
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20 there is created a duplication in numbering, reads as follows:
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21 As used in Sections 1 through 4 of this act:
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22 1. "Compensation" means payments in the form of contract labor
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23 for which the payor is required to provide a Form 1099 to the person
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24 paid wages subject to withholding tax paid to a part-time employee,
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 1 full-time employee, salary, or other remuneration. Compensation
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2 shall not include employer-provided retirement, medical or health-
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3 care benefits, reimbursement for travel, meals, lodging, or any
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4 other expense;
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5 2. "Institution" means an institution within The Oklahoma State
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6 System of Higher Education, any other public or private college, or
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7 university that is accredited by a national accrediting body;
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8 3. "Qualified employer" means a sole proprietor, general
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9 partnership, limited partnership, limited liability company,
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10 corporation, other legally recognized business entity, or public
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11 entity whose principal business activity involves civil engineering
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12 services as described by Industry No. 541330 of the North American
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13 Industry Classification System (NAICS), latest revision;
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14 4. "Qualified employee" means any person, regardless of the
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15 date of hire, employed in this state, contracting in this state with
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16 a qualified employer on or after January 1, 2025, who was not
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17 employed as a civil engineer in this state immediately preceding
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18 employment or contracting with a qualified employer, and who has
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19 been either:
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20 a. awarded an undergraduate or graduate degree from a
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21 qualified program by an institution, or
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22 b. licensed as a Professional Engineer by the State Board
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23 of Licensure for Professional Engineers and Land
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 1 Surveyors pursuant to Section 475.15 of Title 59 of
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2 the Oklahoma Statutes.
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3 Provided, the definition shall not be interpreted to exclude any
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4 person who was employed in the civil engineering sector, but not as
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5 a full-time engineer, prior to being awarded an undergraduate or
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6 graduate degree from a qualified program by an institution or any
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7 person who has been awarded an undergraduate or graduate degree from
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8 a qualified program by an institution and is employed by a
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9 professional staffing company and assigned to work in the civil
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10 engineering sector in this state.
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11 Beginning on or after January 1, 2025, the definition shall also
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12 not be interpreted to exclude any person who:
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13 (1) previously qualified and established the credit
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14 against the tax imposed pursuant to Section 2355
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15 of this title and becomes employed by a different
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16 qualified employer, or
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17 (2) establishes the credit against the tax imposed
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18 pursuant to Section 2355 of Title 68 of the
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19 Oklahoma Statutes for the first time and becomes
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20 employed by a different qualified employer in
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21 subsequent years, provided a person in either
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22 case has not claimed the credit for the lifetime
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23 maximum of five (5) years;
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 1 6. "Qualified program" means a program at an institution that
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2 includes a graduate or undergraduate program that has been
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3 accredited by the Engineering Accreditation Commission of the
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4 Accreditation Board for Engineering and Technology (ABET) and that
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5 awards an undergraduate or graduate degree. Both the undergraduate
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6 and graduate programs of the same discipline of engineering at an
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7 institution shall be part of the qualified program if either program
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8 is ABET accredited; and
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9 7. "Tuition" means the average annual amount paid by a
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10 qualified employee for enrollment and instruction in a qualified
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11 program. Tuition shall not include the cost of books, fees or room
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12 and board.
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13 SECTION 2. NEW LAW A new section of law to be codified
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14 in the Oklahoma Statutes as Section 2357.322 of Title 68, unless
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15 there is created a duplication in numbering, reads as follows:
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16 A. For taxable years beginning after December 31, 2024, and
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17 ending before January 1, 2030, a qualified employer shall be allowed
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18 a credit against the tax imposed pursuant to Section 2355 of Title
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19 68 of the Oklahoma Statutes for tuition reimbursed to a qualified
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20 employee.
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21 B. The credit authorized by subsection A of this section may be
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22 claimed only if the qualified employee has been awarded an
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23 undergraduate or graduate degree within one (1) year of commencing
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24 employment with the qualified employer.
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 1 C. The credit authorized by subsection A of this section shall
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2 be in the amount of fifty percent (50%) of the tuition reimbursed to
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3 a qualified employee for the first through fourth years of
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4 employment. In no event shall this credit exceed fifty percent
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5 (50%) of the average annual amount paid by a qualified employee for
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6 enrollment and instruction in a qualified program at a public
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7 institution in Oklahoma.
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8 D. The credit authorized by subsection A of this section shall
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9 not be used to reduce the tax liability of the qualified employer to
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10 less than zero (0).
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11 E. No credit authorized by this section shall be claimed after
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12 the fourth year of employment.
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13 SECTION 3. NEW LAW A new section of law to be codified
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14 in the Oklahoma Statutes as Section 2357.323 of Title 68, unless
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15 there is created a duplication in numbering, reads as follows:
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16 A. For taxable years beginning on or after January 1, 2025, and
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17 ending before January 1, 2030, a qualified employer shall be allowed
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18 a credit against the tax imposed pursuant to Section 2355 of Title
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19 68 of the Oklahoma Statutes for compensation paid to a qualified
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20 employee.
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21 B. The credit authorized by subsection A of this section shall
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22 be in the amount of:
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23 1. Ten percent (10%) of the compensation paid for the first
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24 through fifth years of employment in civil engineering if the
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 1 qualified employee graduated from an institution located in this
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2 state; or
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3 2. Five percent (5%) of the compensation paid for the first
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4 through fifth years of employment in civil engineering if the
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5 qualified employee graduated from an institution located outside
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6 this state.
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7 C. The credit authorized by this section shall not exceed
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8 Twelve Thousand Five Hundred Dollars ($12,500.00) for each qualified
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9 employee annually.
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10 D. The credit authorized by this section shall not be used to
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11 reduce the tax liability of the qualified employer to less than zero
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12 (0).
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13 E. No credit authorized pursuant to this section shall be
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14 claimed after the fifth year of employment.
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15 SECTION 4. NEW LAW A new section of law to be codified
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16 in the Oklahoma Statutes as Section 2357.324 of Title 68, unless
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17 there is created a duplication in numbering, reads as follows:
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18 A. For taxable years beginning on or after January 1, 2025, and
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19 ending before January 1, 2030, a qualified employee shall be allowed
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20 a credit against the tax imposed pursuant to Section 2355 of Title
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21 68 of the Oklahoma Statutes up to Five Thousand Dollars ($5,000.00)
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22 per year for a period of time not to exceed five (5) years.
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23 B. The credit authorized by this section shall not be used to
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24 reduce the tax liability of the taxpayer to less than zero (0).
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 1 C. Any credit claimed, but not used, may be carried over in
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2 order to each of the five (5) subsequent taxable years.
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3 SECTION 5. This act shall become effective November 1, 2024.
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5 59-2-9563 AO 01/12/24
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