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Human Capital Investment Credit


A credit may be applied against the Connecticut corporation business tax for expenditures made by a corporation for the following types of human capital investments:

  • In-state job training of persons employed in Connecticut;

  • Work education programs in Connecticut which include but are not limited to programs in public high schools and work education-diversified occupation programs;

  • Worker training and education of persons employed in Connecticut provided by Connecticut institutions of higher learning;

  • Donations or capital contributions to institutions of higher learning in Connecticut for improvements or advancement of technology, including physical plant improvements;

  • Planning, site preparation, construction, renovation, or acquisition of facilities in Connecticut for the purpose of establishing a day care facility to be used primarily by the children of employees who are employed in Connecticut;

  • Child care subsidies paid to employees employed in Connecticut for child care provided in Connecticut; or

  • Contributions made to the Individual Development Account Reserve Fund, as defined in Conn. Gen. Stat. §31-51ww.


Training is the instruction, maintenance, or improvement of the skills required by the employer for the proper performance of the employee’s duties that are conducted in Connecticut.

Work education programs include but are not limited to programs in public high schools and work education- diversified occupation programs.

Expenditures are those amounts paid or incurred for the income year.

Q & A on the Human Capital Investment Credit Applying to In-State Training of Persons Employed in Connecticut:

  • 1.

    Do employees’ salaries while training qualify? No.

  • 2.

    Can payroll taxes and fringe benefits be included?

No. These expenses are deemed actual employee expenses and not training expenses.

  • 3.

    Does the cost of training materials qualify? Yes, if the training takes place in Connecticut.

  • 4.

    Does the training facility and depreciation expense qualify as an eligible training expense?

The cost of the training facility in Connecticut is allowed, but depreciation expenses do not qualify.

  • 5.

    What other expenses qualify? In determining whether certain expenses qualify for the credit, a distinction must be made between direct and indirect expenses. Direct training expenses qualify, but indirect expenses do not qualify. For example, if a corporation hires a training instructor, the expenses of the instructor qualify to the extent that the expenses are directly related to training that meets the statutory requirements. Indirect expenses such as overhead do not qualify.

  • 6.

    Does the cost of course registration qualify? Yes.

  • 7.

    Does tuition reimbursement qualify? Yes, but the tuition must be paid to institutions of higher learning within Connecticut for training in Connecticut.

  • 8.

    Do travel costs related to the training qualify? Yes, provided the travel is within Connecticut.

Informational Publication 2006(15), Guide to Connecticut Business Tax Credits Issued: 04/24/07


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