{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/58.1-439.6.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/58.1-439.6.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/58.1-439.6.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/58.1-439.6.html"}],"law_id":81908,"edition_id":1,"section_id":81908,"structure_id":13153,"section_number":"58.1-439.6","catch_line":"Worker retraining tax credit","history":"1997, c. 726; 2013, cc. 294, 482; 2014, c. 734; 2017, cc. 177, 454; 2018, c. 500; 2019, c. 189.","full_text":"A\n\nAs used in this section, unless the context clearly requires otherwise:\n\t\t\t“Eligible worker retraining” means retraining of a qualified employee that promotes economic development in the form of (i) noncredit courses at any of the Commonwealth’s comprehensive community colleges or a private school or (ii) worker retraining programs undertaken through an apprenticeship agreement approved by the Commissioner of Labor and Industry.\n\t\t\t“Manufacturing” means processing, manufacturing, refining, mining, or converting products for sale or resale.\n\t\t\t“Qualified employee” means an employee of an employer eligible for a credit under this section in a full-time position requiring a minimum of 1,680 hours in the entire normal year of the employer’s operations if the standard fringe benefits are paid by the employer for the employee. Employees in seasonal or temporary positions shall not qualify as qualified employees. A qualified employee (i) shall not be a relative of any owner or the employer claiming the credit and (ii) shall not own, directly or indirectly, more than five percent in value of the outstanding stock of a corporation claiming the credit. As used herein, “relative” means a spouse, child, grandchild, parent or sibling of an owner or employer, and “owner” means, in the case of a corporation, any person who owns five percent or more of the corporation’s stock.\n\t\t\t“STEM or STEAM discipline” means a science, technology, engineering, mathematics, or applied mathematics related discipline as certified by the Virginia Economic Development Partnership Authority in consultation with the Superintendent of Public Instruction. The term shall include a health care-related discipline.B\n\n1. For taxable years beginning on and after January 1, 1999, but prior to January 1, 2019, an employer shall be allowed a credit against the taxes imposed by Articles 2 (\u00a7 58.1-320 et seq.), 6 (\u00a7 58.1-360 et seq.), and 10 (\u00a7 58.1-400 et seq.) of Chapter 3; Chapter 12 (\u00a7 58.1-1200 et seq.); Article 1 (\u00a7 58.1-2500 et seq.) of Chapter 25; or Article 2 (\u00a7 58.1-2620 et seq.) of Chapter 26 in an amount equal to 30 percent of all expenditures paid or incurred by the employer during the taxable year for eligible worker retraining. For taxable years beginning on or after January 1, 2013, but prior to January 1, 2019, if the eligible worker retraining consists of courses conducted at a private school, the credit shall be in an amount equal to the cost per qualified employee, but the amount of the credit shall not exceed $200 per qualified employee annually, or $300 per qualified employee annually if the eligible worker retraining includes retraining in a STEM or STEAM discipline, including but not limited to industry-recognized credentials, certificates, and certifications.2\n\nFor taxable years beginning on and after January 1, 2018, but prior to January 1, 2019, a business primarily engaged in manufacturing shall be allowed a credit against the taxes imposed by Articles 2 (§ 58.1-320 et seq.) and 10 (§ 58.1-400 et seq.) in an amount equal to 35 percent of its direct costs incurred during the taxable year in conducting orientation, instruction, and training in the Commonwealth relating to the manufacturing activities undertaken by the business. In no event shall the credit allowed to a business under this subdivision exceed $2,000 for any taxable year. The Department shall allow credit only for programs that (i) provide orientation, instruction, and training solely to students in grades six through 12; (ii) are coordinated with the local school division; and (iii) are conducted either at a plant or facility owned, leased, rented, or otherwise used by the business or at a public middle or high school in Virginia. The taxpayer shall include in its direct costs only the following expenditures: (a) salaries or wages paid to instructors and trainers, prorated for the period of instruction or training; (b) costs for orientation, instruction, and training materials; (c) amounts paid for machinery and equipment used primarily for such instruction and training; and (d) the cost of leased or rented space used primarily for conducting the program.3\n\nThe total amount of tax credits granted under this section for each fiscal year shall not exceed $1 million.C\n\nFor purposes of this section, the amount of any credit attributable to a partnership, electing small business corporation (S corporation), or limited liability company shall be allocated to the individual partners, shareholders, or members, respectively, in proportion to their ownership or interest in such business entities.D\n\n1. An employer shall be allowed a credit pursuant to subdivision B 1 only for those courses at a comprehensive community college or a private school for which courses have been certified as eligible worker retraining to the Department of Taxation by the Virginia Economic Development Partnership Authority. The Virginia Economic Development Partnership Authority shall review requests for certification submitted by employers and shall advise the Tax Commissioner whether a course or program qualifies as eligible worker retraining and, if it qualifies, whether the course or program is in a STEM or STEAM discipline.2\n\nA business shall be allowed the credit pursuant to subdivision B 2 only for an orientation, instruction, and training program that has been approved by the local school division and certified as eligible by the Virginia Economic Development Partnership Authority. A business seeking a tax credit under subdivision B 2 shall include in its application reviewed by the Virginia Economic Development Partnership Authority an approval from the local school division. The Virginia Economic Development Partnership Authority shall review requests for certification submitted by businesses and shall advise the Tax Commissioner whether an orientation, instruction, and training program qualifies as relating to the manufacturing activities undertaken by the business and meets other applicable requirements.3\n\nThe Tax Commissioner shall develop guidelines (i) establishing procedures for claiming the credit provided by this section, (ii) defining eligible worker retraining, which shall include only those courses and programs that are substantially related to the duties of a qualified employee or that enhance the qualified employee’s job-related skills, and that promote economic development, and (iii) providing for the allocation of credits among employers and businesses requesting credits in the event that the amount of credits for which requests are made exceeds the available amount of credits in any year. Such guidelines shall be exempt from the provisions of the Administrative Process Act (§ 2.2-4000 et seq.).E\n\nAny credit not usable for the taxable year may be carried over for the next three taxable years. The amount of credit allowed pursuant to this section shall not exceed the tax imposed for such taxable year. No credit shall be carried back to a preceding taxable year. If an employer or business that is subject to the tax limitation imposed pursuant to this subsection is allowed another credit pursuant to any other section of this Code, or has a credit carryover from a preceding taxable year, such employer or business shall be considered to have first utilized any credit allowed which does not have a carryover provision, and then any credit which is carried forward from a preceding taxable year, prior to the utilization of any credit allowed pursuant to this section.F\n\nNo employer or business shall be eligible to claim a credit under this section for worker retraining or manufacturing orientation, instruction, and training undertaken by any program operated, administered, or paid for by the Commonwealth.G\n\nThe Department shall review certifications received from the Virginia Economic Development Partnership Authority pursuant to subsection D and, if it determines a taxpayer meets the applicable requirements, shall issue a credit in the amount specified in subsection B.H\n\nThe Virginia Economic Development Partnership Authority shall report annually to the Chairmen of the House Committee on Finance and the Senate Committee on Finance and Appropriations on the status and implementation of the credit established by this section, including certifications for eligible worker retraining.","order_by":null,"text":{"0":{"id":293448,"text":"As used in this section, unless the context clearly requires otherwise:\n\t\t\t“Eligible worker retraining” means retraining of a qualified employee that promotes economic development in the form of (i) noncredit courses at any of the Commonwealth’s comprehensive community colleges or a private school or (ii) worker retraining programs undertaken through an apprenticeship agreement approved by the Commissioner of Labor and Industry.\n\t\t\t“Manufacturing” means processing, manufacturing, refining, mining, or converting products for sale or resale.\n\t\t\t“Qualified employee” means an employee of an employer eligible for a credit under this section in a full-time position requiring a minimum of 1,680 hours in the entire normal year of the employer’s operations if the standard fringe benefits are paid by the employer for the employee. Employees in seasonal or temporary positions shall not qualify as qualified employees. A qualified employee (i) shall not be a relative of any owner or the employer claiming the credit and (ii) shall not own, directly or indirectly, more than five percent in value of the outstanding stock of a corporation claiming the credit. As used herein, “relative” means a spouse, child, grandchild, parent or sibling of an owner or employer, and “owner” means, in the case of a corporation, any person who owns five percent or more of the corporation’s stock.\n\t\t\t“STEM or STEAM discipline” means a science, technology, engineering, mathematics, or applied mathematics related discipline as certified by the Virginia Economic Development Partnership Authority in consultation with the Superintendent of Public Instruction. The term shall include a health care-related discipline.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":293449,"text":"1. For taxable years beginning on and after January 1, 1999, but prior to January 1, 2019, an employer shall be allowed a credit against the taxes imposed by Articles 2 (\u00a7 58.1-320 et seq.), 6 (\u00a7 58.1-360 et seq.), and 10 (\u00a7 58.1-400 et seq.) of Chapter 3; Chapter 12 (\u00a7 58.1-1200 et seq.); Article 1 (\u00a7 58.1-2500 et seq.) of Chapter 25; or Article 2 (\u00a7 58.1-2620 et seq.) of Chapter 26 in an amount equal to 30 percent of all expenditures paid or incurred by the employer during the taxable year for eligible worker retraining. For taxable years beginning on or after January 1, 2013, but prior to January 1, 2019, if the eligible worker retraining consists of courses conducted at a private school, the credit shall be in an amount equal to the cost per qualified employee, but the amount of the credit shall not exceed $200 per qualified employee annually, or $300 per qualified employee annually if the eligible worker retraining includes retraining in a STEM or STEAM discipline, including but not limited to industry-recognized credentials, certificates, and certifications.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A","next_prefix":"B2"},"2":{"id":293450,"text":"For taxable years beginning on and after January 1, 2018, but prior to January 1, 2019, a business primarily engaged in manufacturing shall be allowed a credit against the taxes imposed by Articles 2 (§ 58.1-320 et seq.) and 10 (§ 58.1-400 et seq.) in an amount equal to 35 percent of its direct costs incurred during the taxable year in conducting orientation, instruction, and training in the Commonwealth relating to the manufacturing activities undertaken by the business. In no event shall the credit allowed to a business under this subdivision exceed $2,000 for any taxable year. The Department shall allow credit only for programs that (i) provide orientation, instruction, and training solely to students in grades six through 12; (ii) are coordinated with the local school division; and (iii) are conducted either at a plant or facility owned, leased, rented, or otherwise used by the business or at a public middle or high school in Virginia. The taxpayer shall include in its direct costs only the following expenditures: (a) salaries or wages paid to instructors and trainers, prorated for the period of instruction or training; (b) costs for orientation, instruction, and training materials; (c) amounts paid for machinery and equipment used primarily for such instruction and training; and (d) the cost of leased or rented space used primarily for conducting the program.","type":"section","prefixes":["B","2"],"prefix":"2","entire_prefix":"B2","prefix_anchor":"B2","level":2,"prior_prefix":"B","next_prefix":"B3"},"3":{"id":293451,"text":"The total amount of tax credits granted under this section for each fiscal year shall not exceed $1 million.","type":"section","prefixes":["B","3"],"prefix":"3","entire_prefix":"B3","prefix_anchor":"B3","level":2,"prior_prefix":"B2","next_prefix":"C"},"4":{"id":293452,"text":"For purposes of this section, the amount of any credit attributable to a partnership, electing small business corporation (S corporation), or limited liability company shall be allocated to the individual partners, shareholders, or members, respectively, in proportion to their ownership or interest in such business entities.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B3","next_prefix":"D"},"5":{"id":293453,"text":"1. An employer shall be allowed a credit pursuant to subdivision B 1 only for those courses at a comprehensive community college or a private school for which courses have been certified as eligible worker retraining to the Department of Taxation by the Virginia Economic Development Partnership Authority. The Virginia Economic Development Partnership Authority shall review requests for certification submitted by employers and shall advise the Tax Commissioner whether a course or program qualifies as eligible worker retraining and, if it qualifies, whether the course or program is in a STEM or STEAM discipline.","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C","next_prefix":"D2"},"6":{"id":293454,"text":"A business shall be allowed the credit pursuant to subdivision B 2 only for an orientation, instruction, and training program that has been approved by the local school division and certified as eligible by the Virginia Economic Development Partnership Authority. A business seeking a tax credit under subdivision B 2 shall include in its application reviewed by the Virginia Economic Development Partnership Authority an approval from the local school division. The Virginia Economic Development Partnership Authority shall review requests for certification submitted by businesses and shall advise the Tax Commissioner whether an orientation, instruction, and training program qualifies as relating to the manufacturing activities undertaken by the business and meets other applicable requirements.","type":"section","prefixes":["D","2"],"prefix":"2","entire_prefix":"D2","prefix_anchor":"D2","level":2,"prior_prefix":"D","next_prefix":"D3"},"7":{"id":293455,"text":"The Tax Commissioner shall develop guidelines (i) establishing procedures for claiming the credit provided by this section, (ii) defining eligible worker retraining, which shall include only those courses and programs that are substantially related to the duties of a qualified employee or that enhance the qualified employee’s job-related skills, and that promote economic development, and (iii) providing for the allocation of credits among employers and businesses requesting credits in the event that the amount of credits for which requests are made exceeds the available amount of credits in any year. Such guidelines shall be exempt from the provisions of the Administrative Process Act (§ 2.2-4000 et seq.).","type":"section","prefixes":["D","3"],"prefix":"3","entire_prefix":"D3","prefix_anchor":"D3","level":2,"prior_prefix":"D2","next_prefix":"E"},"8":{"id":293456,"text":"Any credit not usable for the taxable year may be carried over for the next three taxable years. The amount of credit allowed pursuant to this section shall not exceed the tax imposed for such taxable year. No credit shall be carried back to a preceding taxable year. If an employer or business that is subject to the tax limitation imposed pursuant to this subsection is allowed another credit pursuant to any other section of this Code, or has a credit carryover from a preceding taxable year, such employer or business shall be considered to have first utilized any credit allowed which does not have a carryover provision, and then any credit which is carried forward from a preceding taxable year, prior to the utilization of any credit allowed pursuant to this section.","type":"section","prefixes":["E"],"prefix":"E","entire_prefix":"E","prefix_anchor":"E","level":1,"prior_prefix":"D3","next_prefix":"F"},"9":{"id":293457,"text":"No employer or business shall be eligible to claim a credit under this section for worker retraining or manufacturing orientation, instruction, and training undertaken by any program operated, administered, or paid for by the Commonwealth.","type":"section","prefixes":["F"],"prefix":"F","entire_prefix":"F","prefix_anchor":"F","level":1,"prior_prefix":"E","next_prefix":"G"},"10":{"id":293458,"text":"The Department shall review certifications received from the Virginia Economic Development Partnership Authority pursuant to subsection D and, if it determines a taxpayer meets the applicable requirements, shall issue a credit in the amount specified in subsection B.","type":"section","prefixes":["G"],"prefix":"G","entire_prefix":"G","prefix_anchor":"G","level":1,"prior_prefix":"F","next_prefix":"H"},"11":{"id":293459,"text":"The Virginia Economic Development Partnership Authority shall report annually to the Chairmen of the House Committee on Finance and the Senate Committee on Finance and Appropriations on the status and implementation of the credit established by this section, including certifications for eligible worker retraining.","type":"section","prefixes":["H"],"prefix":"H","entire_prefix":"H","prefix_anchor":"H","level":1,"prior_prefix":"G"}},"ancestry":[{"id":13153,"edition_id":1,"name":"Tax Credits for Corporations","identifier":"13","label":"article","depth":4,"order_by":1,"parent_id":13152,"metadata":{},"date_created":"2026-06-26 03:44:21","date_modified":"2026-06-26 03:44:21","permalink":{"id":253497,"object_type":"structure","relational_id":13153,"identifier":"13","token":"58.1\/I\/3\/13","url":"\/58.1\/I\/3\/13\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13152,"edition_id":1,"name":"Income Tax","identifier":"3","label":"chapter","depth":3,"order_by":1,"parent_id":12837,"metadata":{},"date_created":"2026-06-26 03:44:21","date_modified":"2026-06-26 03:44:21","permalink":{"id":253267,"object_type":"structure","relational_id":13152,"identifier":"3","token":"58.1\/I\/3","url":"\/58.1\/I\/3\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12837,"edition_id":1,"name":"Taxes 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credit","url":"\/58.1-439.6_1\/","token":"58.1\/I\/3\/13\/58.1-439.6_1","metadata":false},{"id":55856,"structure_id":13153,"section_number":"58.1-439.7","catch_line":"Tax credit for purchase of machinery and equipment used for advanced recycling and processing recyclable materials","url":"\/58.1-439.7\/","token":"58.1\/I\/3\/13\/58.1-439.7","metadata":false},{"id":82497,"structure_id":13153,"section_number":"58.1-439.8","catch_line":"Repealed","url":"\/58.1-439.8\/","token":"58.1\/I\/3\/13\/58.1-439.8","metadata":false},{"id":66196,"structure_id":13153,"section_number":"58.1-439.9","catch_line":"Tax credit for certain employers hiring recipients of Temporary Assistance for Needy Families","url":"\/58.1-439.9\/","token":"58.1\/I\/3\/13\/58.1-439.9","metadata":false}],"previous_section":{"id":66742,"structure_id":13153,"section_number":"58.1-439.5","catch_line":"Agricultural best management practices tax credit","url":"\/58.1-439.5\/","token":"58.1\/I\/3\/13\/58.1-439.5","metadata":false},"next_section":{"id":60296,"structure_id":13153,"section_number":"58.1-439.6:1","catch_line":"Worker training tax credit","url":"\/58.1-439.6_1\/","token":"58.1\/I\/3\/13\/58.1-439.6_1","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/58.1-439.6\/","history_text":"

This law was first created in 1997. The record of its establishment is cataloged in chapter 726<\/a> of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. It has been modified 5 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 2013, chapters 294<\/a> and 482<\/a>; in 2014, chapter 734<\/a>; in 2017, chapters 177<\/a> and 454<\/a>; in 2018, chapter 500<\/a>; in 2019, chapter 189<\/a>.<\/p>","references":false,"refers_to":[{"id":86911,"section_number":"2.2-4000","catch_line":"Short title; purpose","order_by":null,"url":"\/2.2-4000\/"},{"id":54678,"section_number":"58.1-1200","catch_line":"Title","order_by":null,"url":"\/58.1-1200\/"},{"id":56221,"section_number":"58.1-2500","catch_line":"Definitions","order_by":null,"url":"\/58.1-2500\/"},{"id":54193,"section_number":"58.1-2620","catch_line":"Basis of tax","order_by":null,"url":"\/58.1-2620\/"},{"id":62270,"section_number":"58.1-320","catch_line":"Imposition of tax","order_by":null,"url":"\/58.1-320\/"},{"id":82371,"section_number":"58.1-360","catch_line":"Imposition of tax","order_by":null,"url":"\/58.1-360\/"},{"id":60955,"section_number":"58.1-400","catch_line":"Imposition of tax","order_by":null,"url":"\/58.1-400\/"}],"permalink":{"id":253623,"object_type":"law","relational_id":81908,"identifier":"58.1-439.6","token":"58.1\/I\/3\/13\/58.1-439.6","url":"\/58.1-439.6\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/58.1-439.6\/","token":"58.1\/I\/3\/13\/58.1-439.6","dublin_core":{"Title":"Worker retraining tax credit","Type":"Text","Format":"text\/html","Identifier":"\u00a7 58.1-439.6","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> As used in this section, unless the context clearly requires otherwise:\n\t\t\t“Eligible worker retraining<\/span>” means retraining of a qualified employee<\/span> that promotes economic development in the form of (i) noncredit courses at any of the Commonwealth’s comprehensive community colleges or a private school or (ii) worker retraining programs undertaken through an apprenticeship agreement approved by the Commissioner of Labor and Industry.\n\t\t\t“Manufacturing<\/span>” means processing, manufacturing<\/span>, refining, mining, or converting products for sale or resale.\n\t\t\t“Qualified employee<\/span>” means an employee of an employer eligible for a credit under this section in a full-time position requiring a minimum of 1,680 hours in the entire normal year of the employer’s operations if the standard fringe benefits are paid by the employer for the employee. Employees in seasonal or temporary positions shall not qualify as qualified employees<\/span>. A qualified employee<\/span> (i) shall not be a relative<\/span> of any owner<\/span> or the employer claiming the credit and (ii) shall not own, directly or indirectly, more than five percent in value of the outstanding stock of a corporation<\/span> claiming the credit. As used herein, “relative<\/span>” means a spouse, child, grandchild, parent or sibling of an owner<\/span> or employer, and “owner<\/span>” means, in the case of a corporation<\/span>, any person who owns five percent or more of the corporation<\/span>’s stock.\n\t\t\t“STEM or STEAM discipline<\/span>” means a science, technology, engineering, mathematics, or applied mathematics related discipline as certified by the Virginia Economic Development Partnership Authority in consultation with the Superintendent of Public Instruction. The term shall include a health care-related discipline. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> 1. For taxable years beginning on and after January 1, 1999, but prior to January 1, 2019, an employer shall be allowed a credit against the taxes imposed by Articles 2 (\u00a7 58.1-320<\/a> et seq.), 6 (\u00a7 58.1-360<\/a> et seq.), and 10 (\u00a7 58.1-400<\/a> et seq.) of Chapter 3; Chapter 12 (\u00a7 58.1-1200<\/a> et seq.); Article 1 (\u00a7 58.1-2500<\/a> et seq.) of Chapter 25; or Article 2 (\u00a7 58.1-2620<\/a> et seq.) of Chapter 26 in an amount equal to 30 percent of all expenditures paid or incurred by the employer during the taxable year for eligible worker retraining<\/span>. For taxable years beginning on or after January 1, 2013, but prior to January 1, 2019, if the eligible worker retraining<\/span> consists of courses conducted at a private school, the credit shall be in an amount equal to the cost per qualified employee<\/span>, but the amount of the credit shall not exceed $200 per qualified employee<\/span> annually, or $300 per qualified employee<\/span> annually if the eligible worker retraining<\/span> includes retraining in a STEM or STEAM discipline<\/span>, including but not limited to industry-recognized credentials, certificates, and certifications. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> For taxable years beginning on and after January 1, 2018, but prior to January 1, 2019, a business primarily engaged in manufacturing<\/span> shall be allowed a credit against the taxes imposed by Articles 2 (§ 58.1-320<\/a> et seq.) and 10 (§ 58.1-400<\/a> et seq.) in an amount equal to 35 percent of its direct costs incurred during the taxable year in conducting orientation, instruction, and training in the Commonwealth relating to the manufacturing<\/span> activities undertaken by the business. In no event shall the credit allowed to a business under this subdivision exceed $2,000 for any taxable year. The Department<\/span> shall allow credit only for programs that (i) provide orientation, instruction, and training solely to students in grades six through 12; (ii) are coordinated with the local school division; and (iii) are conducted either at a plant or facility owned, leased, rented, or otherwise used by the business or at a public middle or high school in Virginia. The taxpayer<\/span> shall include in its direct costs only the following expenditures: (a) salaries or wages paid to instructors and trainers, prorated for the period of instruction or training; (b) costs for orientation, instruction, and training materials<\/span>; (c) amounts paid for machinery and equipment used primarily for such instruction and training; and (d) the cost of leased or rented space used primarily for conducting the program. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> The total amount of tax credits granted under this section for each fiscal year shall not exceed $1 million. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> For purposes of this section, the amount of any credit attributable to a partnership, electing small business corporation<\/span> (S corporation<\/span>), or limited liability company shall be allocated to the individual<\/span> partners, shareholders, or members, respectively, in proportion to their ownership or interest in such business entities. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> 1. An employer shall be allowed a credit pursuant to subdivision B 1 only for those courses at a comprehensive community college or a private school for which courses have been certified as eligible worker retraining<\/span> to the Department<\/span> of Taxation by the Virginia Economic Development Partnership Authority. The Virginia Economic Development Partnership Authority shall review requests for certification submitted by employers and shall advise the Tax Commissioner<\/span> whether a course or program qualifies as eligible worker retraining<\/span> and, if it qualifies, whether the course or program is in a STEM or STEAM discipline<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> A business shall be allowed the credit pursuant to subdivision B 2 only for an orientation, instruction, and training program that has been approved by the local school division and certified as eligible by the Virginia Economic Development Partnership Authority. A business seeking a tax credit under subdivision B 2 shall include in its application reviewed by the Virginia Economic Development Partnership Authority an approval from the local school division. The Virginia Economic Development Partnership Authority shall review requests for certification submitted by businesses and shall advise the Tax Commissioner<\/span> whether an orientation, instruction, and training program qualifies as relating to the manufacturing<\/span> activities undertaken by the business and meets other applicable requirements. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> The Tax Commissioner<\/span> shall develop guidelines (i) establishing procedures for claiming the credit provided by this section, (ii) defining eligible worker retraining<\/span>, which shall include only those courses and programs that are substantially related to the duties of a qualified employee<\/span> or that enhance the qualified employee<\/span>’s job-related skills, and that promote economic development, and (iii) providing for the allocation of credits among employers and businesses requesting credits in the event that the amount of credits for which requests are made exceeds the available amount of credits in any year. Such guidelines shall be exempt from the provisions of the Administrative Process Act (§ 2.2-4000<\/a> et seq.). <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

E.<\/span> Any credit not usable for the taxable year may be carried over for the next three taxable years. The amount of credit allowed pursuant to this section shall not exceed the tax imposed for such taxable year. No credit shall be carried back to a preceding taxable year. If an employer or business that is subject to the tax limitation imposed pursuant to this subsection is allowed another credit pursuant to any other section of this Code, or has a credit carryover from a preceding taxable year, such employer or business shall be considered to have first utilized any credit allowed which does not have a carryover provision, and then any credit which is carried forward from a preceding taxable year, prior to the utilization of any credit allowed pursuant to this section. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

F.<\/span> No employer or business shall be eligible to claim a credit under this section for worker retraining or manufacturing<\/span> orientation, instruction, and training undertaken by any program operated, administered, or paid for by the Commonwealth. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

G.<\/span> The Department<\/span> shall review certifications received from the Virginia Economic Development Partnership Authority pursuant to subsection D and, if it determines a taxpayer<\/span> meets the applicable requirements, shall issue<\/span> a credit in the amount specified in subsection B. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

H.<\/span> The Virginia Economic Development Partnership Authority shall report annually to the Chairmen of the House Committee on Finance and the Senate Committee on Finance and Appropriations on the status and implementation of the credit established by this section, including certifications for eligible worker retraining<\/span>. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nWORKER RETRAINING TAX CREDIT (\u00a7 58.1-439.6)\n\nA. As used in this section, unless the context clearly requires otherwise:\n\t\t\t“Eligible worker retraining” means retraining of a qualified\nemployee that promotes economic development in the form of (i) noncredit courses\nat any of the Commonwealth’s comprehensive community colleges or a private\nschool or (ii) worker retraining programs undertaken through an apprenticeship\nagreement approved by the Commissioner of Labor and Industry.\n\t\t\t“Manufacturing” means processing, manufacturing, refining,\nmining, or converting products for sale or resale.\n\t\t\t“Qualified employee” means an employee of an employer eligible\nfor a credit under this section in a full-time position requiring a minimum of\n1,680 hours in the entire normal year of the employer’s operations if the\nstandard fringe benefits are paid by the employer for the employee. Employees in\nseasonal or temporary positions shall not qualify as qualified employees. A\nqualified employee (i) shall not be a relative of any owner or the employer\nclaiming the credit and (ii) shall not own, directly or indirectly, more than\nfive percent in value of the outstanding stock of a corporation claiming the\ncredit. As used herein, “relative” means a spouse, child,\ngrandchild, parent or sibling of an owner or employer, and “owner”\nmeans, in the case of a corporation, any person who owns five percent or more of\nthe corporation’s stock.\n\t\t\t“STEM or STEAM discipline” means a science, technology,\nengineering, mathematics, or applied mathematics related discipline as certified\nby the Virginia Economic Development Partnership Authority in consultation with\nthe Superintendent of Public Instruction. The term shall include a health\ncare-related discipline.\n\nB. 1. For taxable years beginning on and after January 1, 1999, but prior to\nJanuary 1, 2019, an employer shall be allowed a credit against the taxes imposed\nby Articles 2 (\u00a7 58.1-320 et seq.), 6 (\u00a7 58.1-360 et seq.), and 10 (\u00a7\n58.1-400 et seq.) of Chapter 3; Chapter 12 (\u00a7 58.1-1200 et seq.); Article 1 (\u00a7\n58.1-2500 et seq.) of Chapter 25; or Article 2 (\u00a7 58.1-2620 et seq.) of Chapter\n26 in an amount equal to 30 percent of all expenditures paid or incurred by the\nemployer during the taxable year for eligible worker retraining. For taxable\nyears beginning on or after January 1, 2013, but prior to January 1, 2019, if\nthe eligible worker retraining consists of courses conducted at a private\nschool, the credit shall be in an amount equal to the cost per qualified\nemployee, but the amount of the credit shall not exceed $200 per qualified\nemployee annually, or $300 per qualified employee annually if the eligible\nworker retraining includes retraining in a STEM or STEAM discipline, including\nbut not limited to industry-recognized credentials, certificates, and\ncertifications.\n\n 2. For taxable years beginning on and after January 1, 2018, but prior to\n January 1, 2019, a business primarily engaged in manufacturing shall be\n allowed a credit against the taxes imposed by Articles 2 (§ 58.1-320 et\n seq.) and 10 (§ 58.1-400 et seq.) in an amount equal to 35 percent of its\n direct costs incurred during the taxable year in conducting orientation,\n instruction, and training in the Commonwealth relating to the manufacturing\n activities undertaken by the business. In no event shall the credit allowed to\n a business under this subdivision exceed $2,000 for any taxable year. The\n Department shall allow credit only for programs that (i) provide orientation,\n instruction, and training solely to students in grades six through 12; (ii)\n are coordinated with the local school division; and (iii) are conducted either\n at a plant or facility owned, leased, rented, or otherwise used by the\n business or at a public middle or high school in Virginia. The taxpayer shall\n include in its direct costs only the following expenditures: (a) salaries or\n wages paid to instructors and trainers, prorated for the period of instruction\n or training; (b) costs for orientation, instruction, and training materials;\n (c) amounts paid for machinery and equipment used primarily for such\n instruction and training; and (d) the cost of leased or rented space used\n primarily for conducting the program.\n\n 3. The total amount of tax credits granted under this section for each fiscal\n year shall not exceed $1 million.\n\nC. For purposes of this section, the amount of any credit attributable to a\npartnership, electing small business corporation (S corporation), or limited\nliability company shall be allocated to the individual partners, shareholders,\nor members, respectively, in proportion to their ownership or interest in such\nbusiness entities.\n\nD. 1. An employer shall be allowed a credit pursuant to subdivision B 1 only for\nthose courses at a comprehensive community college or a private school for which\ncourses have been certified as eligible worker retraining to the Department of\nTaxation by the Virginia Economic Development Partnership Authority. The\nVirginia Economic Development Partnership Authority shall review requests for\ncertification submitted by employers and shall advise the Tax Commissioner\nwhether a course or program qualifies as eligible worker retraining and, if it\nqualifies, whether the course or program is in a STEM or STEAM discipline.\n\n 2. A business shall be allowed the credit pursuant to subdivision B 2 only for\n an orientation, instruction, and training program that has been approved by\n the local school division and certified as eligible by the Virginia Economic\n Development Partnership Authority. A business seeking a tax credit under\n subdivision B 2 shall include in its application reviewed by the Virginia\n Economic Development Partnership Authority an approval from the local school\n division. The Virginia Economic Development Partnership Authority shall review\n requests for certification submitted by businesses and shall advise the Tax\n Commissioner whether an orientation, instruction, and training program\n qualifies as relating to the manufacturing activities undertaken by the\n business and meets other applicable requirements.\n\n 3. The Tax Commissioner shall develop guidelines (i) establishing procedures\n for claiming the credit provided by this section, (ii) defining eligible\n worker retraining, which shall include only those courses and programs that\n are substantially related to the duties of a qualified employee or that\n enhance the qualified employee’s job-related skills, and that promote\n economic development, and (iii) providing for the allocation of credits among\n employers and businesses requesting credits in the event that the amount of\n credits for which requests are made exceeds the available amount of credits in\n any year. Such guidelines shall be exempt from the provisions of the\n Administrative Process Act (§ 2.2-4000 et seq.).\n\nE. Any credit not usable for the taxable year may be carried over for the next\nthree taxable years. The amount of credit allowed pursuant to this section shall\nnot exceed the tax imposed for such taxable year. No credit shall be carried\nback to a preceding taxable year. If an employer or business that is subject to\nthe tax limitation imposed pursuant to this subsection is allowed another credit\npursuant to any other section of this Code, or has a credit carryover from a\npreceding taxable year, such employer or business shall be considered to have\nfirst utilized any credit allowed which does not have a carryover provision, and\nthen any credit which is carried forward from a preceding taxable year, prior to\nthe utilization of any credit allowed pursuant to this section.\n\nF. No employer or business shall be eligible to claim a credit under this\nsection for worker retraining or manufacturing orientation, instruction, and\ntraining undertaken by any program operated, administered, or paid for by the\nCommonwealth.\n\nG. The Department shall review certifications received from the Virginia\nEconomic Development Partnership Authority pursuant to subsection D and, if it\ndetermines a taxpayer meets the applicable requirements, shall issue a credit in\nthe amount specified in subsection B.\n\nH. The Virginia Economic Development Partnership Authority shall report annually\nto the Chairmen of the House Committee on Finance and the Senate Committee on\nFinance and Appropriations on the status and implementation of the credit\nestablished by this section, including certifications for eligible worker\nretraining.\n\nHISTORY: 1997, c. 726; 2013, cc. 294, 482; 2014, c. 734; 2017, cc. 177, 454;\n2018, c. 500; 2019, c. 189.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}