INCOME TAX CREDIT

ELIGIBLE
RETRAINING PROGRAMS

ELIGIBLE
RETRAINING COSTS

ELIGIBLE EMPLOYEES

TRAINING SOURCES

ADMINISTRATION

LEGAL AUTHORITY

ASSOCIATED DEFINITIONS 

PROCEDURES 
FOR APPROVAL

DOCUMENTATION 
REQUIREMENTS

APPEALS PROCEDURE

RTC CERTIFICATION

FORMS AND 
RESOURCES 

Purpose
The purpose of the Retraining Tax Credit is to

• foster the profitability and competitiveness of Georgia’s existing businesses by encouraging workforce development through retraining tax incentives;
  
  
• help companies offset the costs of retraining employees that are affected by the implementation of new equipment or new technology;
  
  
• enhance the skills of Georgia employees to enable them to successfully use new equipment, technology, or operating systems.

• equal to one half of the direct cost of retraining;
  
  
• up to $500 per approved training program per year for each full-time employee who has successfully completed an approved retraining program;
  
  
• up to 50 percent of the amount of the taxpayer's income tax liability for the taxable year as computed without regard to this Code.

• retraining of current employees on newly installed equipment;
  
  
• retraining of current employees on newly implemented technology, such as computer platforms, software implementation and upgrades, Total Quality Management, ISO 9000, and self-directed work teams.

• instructor salaries;
• employee wages during the retraining;
• development of retraining program;
• materials and supplies, textbooks and manuals;
• instructional media, such as videotapes, presentations, etc.;
• equipment used for retraining only (not production);
• reasonable travel costs.

• Georgia residents;
  
  
• first-line employees or immediate supervisor;
  
  
• continuously employed with the company for a minimum of 16 weeks;
  
  
• full-time employees (employed for a minimum of 25 hours per week.)

Approved Retraining means retraining programs that are approved (preferably in advance of implementation) by the Georgia Department of Technical and Adult Education.

Cost of Retraining means direct instructional costs which include instructor salaries, materials, supplies, textbooks, manuals, video tapes or other instructional media and training equipment purchased or rented and utilized exclusively for the company’s employee retraining purposes.

Employee wages are also an allowable retraining cost. Such costs are prorated to reflect wages paid only for time devoted exclusively to retraining during paid working hours and that the training does not occur while the employee is producing a product or providing a service.

Costs for renting or otherwise securing space for retraining are excluded.

Employee means any full-time worker who resides in the State of Georgia, who is employed for a minimum of 25 hours per week, and who has been continuously employed by the employer for at least 16 consecutive weeks.

For purposes of the retraining tax credit, employee means workers involved in front-line labor and their immediate supervisors.

Employer means any employer upon whom an income tax is imposed by the State of Georgia.

Employer-provided retraining refers to approved retraining conducted by instructors who are employees of the company.

Employer-sponsored retraining refers to a contractual arrangement with a technical College, university, college, or other training provider that offers approved retraining that is paid for by the employer.

Successful completion of retraining programs means that an employee enrolled in an approved retraining program has demonstrated, through formal assessments, the ability to perform the job skills that the retraining program was designed to provide.

Procedure for Approval of Retraining Programs

1. Company contacts the Vice President of Economic Development Programs at the local Technical College or the state office of Economic Development Programs for information and application package. Information and forms are also available on the internet.* (Suggestion: Discuss the eligibility of any training program with the Vice President of Economic Development before collecting costs and documentation to avoid unnecessary work in case the program is not eligible for the Retraining Tax Credit.)
   
   
2. Company submits Georgia Retraining Tax Credit Program Approval Form along with the required documentation to the Vice President of Economic Development Programs at the local Technical College.
   
   
3. Vice President of Economic Development Programs at the local Technical College reviews the application package for eligibility, adequacy, and completeness.
   
   
4. The retraining program is approved and company is notified.
   
   
5. Company implements retraining.
   
   
6. Company submits a Georgia Retraining Tax Credit Program Completion Form to the Vice President of Economic Development Programs at the local Technical College. The VP signs and returns form to company.
   
   
7. Company attaches Completion Form and Form IT-RC to income tax return and files for income tax credit. (Obtain tax credit forms from the Department of Revenue. An address is included in the left-hand sidebar.. Form IT-RC is available here as a MS Word file)

Retraining Program Documentation Requirements
The documentation for approval of the retraining program must include the following:

1. A description of the equipment, technology, or operating system changes that require employee retraining. (Item #3 on the Approval Form, included in this Guide.)
   
   
2. A description of the purpose and overall objectives of the retraining program. (Item #4 on the Approval Form.)
   
   
3. Documentation for the Retraining Tax Credit approval must include the following:

• Name, address, and phone number of training program provider;
  
  
• Qualifications of training program provider. All individuals who will be developing training or providing instruction should have knowledge, experience, and credentials or certification as appropriate for the training program.
  
  
• Training qualifications of instructors;
  
  
• Training objectives. Training objectives describe what the employee will be able to do after successful completion of retraining and how well the task must be performed as it relates to accuracy, quality, and/or quantity.
  
  
• Criteria for employee performance evaluation and a copy of the evaluation form (if applicable.) An employee performance evaluation determines an employee’s knowledge and ability to perform skills taught during the training program. The employee performance evaluation helps to determine if the employee trainee met the objectives of the retraining program. Evaluation methods vary and may include written tests, performance demonstrations, and performance checklists.
  
  
• Training outline. A training outline includes teaching points which support training objectives, a description of the training methods used – lecture, video, task demonstration – and a list of materials used by the instructor.
  
  
• Instructional materials. Instructional materials vary and include trainee guides, handouts, job aids, and audio-visual aids. These materials should support course objectives.
  
  
• Estimated total hours of instruction;
  
  
• Training schedules;
  
  
• Training location(s).

In order to verify continuing compliance with retraining program standards, the Georgia Department of Technical and Adult Education reserves the right to audit programs at any time.

Appeals Procedure
Each retraining program submitted for retraining income tax credit approval is carefully reviewed. Following this review, each applicant will receive (1) notification of program approval or (2) a description of changes, which are required to meet established program standards and to receive approval for the retraining program. Programs that require changes to meet established training standards may be modified and resubmitted for approval at any time.

Any applicant who wishes to appeal an approval denial may do so.

1. Present the appeal in writing to the Vice President of Economic Development Programs at the local Technical College.
   
   
2. If a mutually agreeable decision is not reached by following step 1, the appeal will be forwarded to the Assistant Commissioner of Economic Development Programs, Georgia Department of Technical and Adult Education for final program approval determination.

Retraining Program Tax Credit Certification
To receive certification for the job retraining tax credit, the company must submit a Georgia Retraining Tax Credit Program Completion Form to the Vice President of Economic Development Programs at the local Technical College. The form requests the following information and program documentation:

• Employee name
  
  
• Employee Identification Number (For audit purposes, the Employee Identification Number must be traceable to the employee’s Social Security Number.)
  
  
• Employee hire date
  
  
• Program title
  
  
• Training date(s)
  
  
• Total training hours
  
  
• Employee hourly wage
  
  
• Total employee wage costs
  
  
• Other direct training costs (Itemized details regarding direct training costs must be available upon audit.)
  
  
• Total program costs
  
  
• Costs with 50% limitation
  
  
• Maximum credit

The Georgia Retraining Tax Credit Program Approval Application and Completion Forms are included in this guide.

Retraining Tax Credit Guide [MS Word - Updated 8/29/07]

Technical College Economic Development Contacts

Technical College Service Areas - By County