(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, the corporation business tax under this chapter, the utility companies tax under chapter 212 or the income tax under chapter 229, the income 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, 2012, and prior to January 1, 2014, 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 job expansion tax credit, is filled by a new, qualifying or veteran employee, and (A) is a full-time job, or (B) in the case of a qualifying employee under subparagraph (B) of subdivision (7) of this subsection, is a job in which an employee is required to work at least twenty hours per week for not less than forty-eight weeks in a calendar year;
(7) “Qualifying employee” means a new employee who, at the time of hiring by the taxpayer:
(A) (i) Is receiving unemployment compensation, or (ii) has exhausted unemployment compensation benefits and has not had an intervening full-time job; or
(B) Is (i) receiving vocational rehabilitation services from the Department of Aging and Disability Services, (ii) receiving employment services from the Department of Mental Health and Addiction Services, or (iii) participating in employment opportunities and day services, as defined in section 17a-226, operated or funded by the Department of Developmental Services;
(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;
(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 job expansion tax credit, and (B) is subject to tax under this chapter or chapter 207, 212 or 229; and
(10) “Veteran employee” means a new employee who, at the time of hiring by the taxpayer, is a member of, was honorably discharged from or released under honorable conditions from active service in the armed forces, as defined in section 27-103.
(b) (1) There is established a job expansion tax credit program whereby a taxpayer may be allowed a credit against the tax imposed under this chapter or chapter 207, 212 or 229, other than the liability imposed by section 12-707, for each new, qualifying or veteran employee hired on or after January 1, 2012, and prior to January 1, 2014. 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 said 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 said 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 said 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:
(1) Five hundred dollars per month for each new employee; or
(2) Nine hundred dollars per month for each qualifying or veteran employee.
(d) (1) The taxpayer shall claim the credit in the income year in which it is earned and, if eligible, in the two immediately succeeding income years. Any credit not claimed by the taxpayer in an 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 new, qualifying or veteran 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 new, qualifying or veteran employee shall claim any credit against any tax under any other provision of the general statutes with respect to the same new, qualifying or veteran employee.
(e) (1) To be eligible to claim the credit, a taxpayer shall apply to the commissioner in accordance with the provisions of 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 new, qualifying or veteran employee. The commissioner shall consult with the Labor Commissioner, the Commissioner of Aging and Disability Services, the Commissioner of Veterans Affairs, the Commissioner of Mental Health and Addiction Services or the Commissioner of Developmental Services, as applicable, for any verification the commissioner deems necessary of unemployment compensation or vocational rehabilitation services received by a qualifying employee, or of service in the armed forces of the United States by a veteran employee. The commissioner may impose a fee for such application as the commissioner deems appropriate.
(2) (A) 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 of its receipt by the commissioner. If the commissioner approves such 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 new, qualifying or veteran employee otherwise meet the requirements of this section.
(B) On and after January 1, 2014, the commissioner shall render a decision upon such completed applications and, if approved, issue such certification letters, as provided in subparagraph (A) of this subdivision, that pertain to qualifying or veteran employees who meet the requirements of this section, and with respect to whom credits pursuant to this section have previously been granted. The commissioner may, in his or her discretion, render a decision upon applications that pertain to new employees, with respect to whom credits pursuant to this section have previously been granted, when such applications are consistent with the economic development priorities of the state.
(f) (1) The total amount of credits granted under this section and sections 12-217ii, 12-217nn and 12-217oo shall not exceed twenty million dollars in any one fiscal year or forty million dollars over the duration of the job expansion tax credit program, including the two immediately succeeding income years after such credits are granted.
(2) If a taxpayer was issued an eligibility certificate by the commissioner prior to January 1, 2012, to receive a jobs creation tax credit pursuant to section 12-217ii, the provisions of the tax credit program pursuant to said section 12-217ii shall apply to such taxpayer for the duration of the eligibility certificate.
(3) If a taxpayer is issued a certification letter by the commissioner prior to January 1, 2013, to receive a qualified small business job creation tax credit pursuant to section 12-217nn, the provisions of the tax credit program pursuant to said section 12-217nn shall apply to such taxpayer for the duration of such certification.
(4) If a taxpayer was issued a certification letter by the commissioner prior to January 1, 2012, to receive a vocational rehabilitation job creation tax credit pursuant to section 12-217oo, the provisions of the tax credit program pursuant to said section 12-217oo shall apply to such taxpayer for the duration of such certification.
(g) No credit allowed under this section shall exceed the amount of tax imposed on a taxpayer under this chapter or chapter 207, 212 or 229. 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.
(h) No credit shall be allowed under this section for any new jobs created on or after January 1, 2014.
(Oct. Sp. Sess. P.A. 11-1, S. 19; June 12 Sp. Sess. P.A. 12-1, S. 61, 62, 198; P.A. 13-123, S. 4; 13-232, S. 11; P.A. 14-60, S. 5; P.A. 16-167, S. 17; P.A. 19-157, S. 34, 35.)
History: Oct. Sp. Sess. P.A. 11-1 effective January 1, 2012, and applicable to income or taxable years commencing on or after that date; June 12 Sp. Sess. P.A. 12-1 amended Subsec. (a)(7)(B) by replacing “Bureau of Rehabilitative Services” with “Department of Rehabilitation Services” and amended Subsec. (e)(1) by replacing “director of the Bureau of Rehabilitative Services” with Commissioner of Rehabilitation Services”, effective July 1, 2012, and further amended Subsec. (a)(7)(B) by designating existing provision as clause (i) and adding clauses (ii) and (iii) re Department of Mental Health and Addiction Services and Department of Developmental Services and further amended Subsec. (e)(1) by adding “Mental Health and Addiction Services or Developmental Services”, effective July 1, 2012, and applicable to income or taxable years commencing on or after January 1, 2012; P.A. 13-123 made technical changes in Subsec. (e)(1), effective June 18, 2013; P.A. 13-232 amended Subsec. (e)(2) by designating existing provisions as Subpara. (A) and adding Subpara. (B) re applications received on and after January 1, 2014, and amended Subsec. (f)(1) by adding provision re $40,000,000 limit over duration of tax credit program, effective July 1, 2013; P.A. 14-60 made technical changes in Subsec. (e)(2)(A); P.A. 16-167 amended Subsec. (e)(1) to replace “Commissioner of Veterans' Affairs” with “Commissioner of Veterans Affairs”, effective July 1, 2016; P.A. 19-157 amended Subsec (a)(7) by replacing “Department of Rehabilitation Services” with “Department of Aging and Disability Services”; P.A. 19-157 amended Subsec. (e)(1) by replacing “Commissioner of Rehabilitation Services” with “Commissioner of Aging and Disability Services”.