Tax break for workforce training donors—but workers can't claim it
H.R. 5493 — USA Workforce Investment Act · Filed by Lloyd Smucker (R-PA) · 4 cosponsors · Introduced Sep 18, 2025 · Referred to committee
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What it does
This bill creates a new federal tax credit allowing individuals to deduct up to $1,700 per year from their federal income taxes for cash donations to nonprofit organizations that provide workforce training or apprenticeship programs. The credit applies only to donations to eligible 501(c)(3) nonprofits listed as approved workforce training providers under federal law, and is reduced by any similar state tax credits the donor already claims.
Why we flagged it
The bill's operative mechanism is a federal income tax credit—a direct reduction in tax liability—conditioned on charitable donations to workforce development nonprofits. This is a tax expenditure (foregone revenue) designed to incentivize private funding of a public-policy goal (workforce training).
What the text implies
- The credit is capped at $1,700 annually but can be carried forward up to five years, allowing donors to accumulate unused credits—potentially creating a large deferred tax benefit for high-income donors who donate sporadically.
- The credit is reduced by state tax credits for the same donations, which may create coordination problems in states with their own workforce-training tax incentives and could reduce the federal credit's actual value in some jurisdictions.
- Eligibility depends on nonprofits being listed under the Workforce Innovation and Opportunity Act (WIOA) §122—a federal administrative list—meaning the IRS must rely on WIOA determinations, creating potential gaps if WIOA eligibility and tax-credit eligibility diverge.
- The bill does not require nonprofits to report donation amounts or use of funds to the IRS, relying on donor self-certification that donations are 'designated' for workforce training—creating audit and compliance risk.
- Higher-income taxpayers benefit disproportionately because the credit is only valuable to those with sufficient tax liability to use it; lower-income workers (the intended beneficiaries of workforce training) cannot claim the credit unless they donate.
Section numbers refer to the bill text the analysis read — linked under Primary records below.
Who it affects
Citizens who donate to workforce training nonprofits gain a tax incentive (net benefit to donors), and workforce training programs may expand if donations increase. However, the tax credit reduces federal revenue that could fund other public priorities, and the benefit flows primarily to higher-income taxpayers who itemize deductions and donate to nonprofits—a regressive subsidy. The public benefit (expanded workforce training) is real but contingent on nonprofits' effectiveness and donor partic
Who stands to gain
- 501(c)(3) nonprofit workforce training organizations (increased donations)
- Individual donors in higher tax brackets (tax reduction)
Named in the bill
Internal Revenue Code of 1986, Section 25G (new), Section 170 (charitable contributions), Section 501(c)(3) (tax-exempt nonprofits), Workforce Innovation and Opportunity Act (WIOA), Section 122 of WIOA (eligible training providers)
Where it stands
4 cosponsors: 4 Republicans.
- Sep 18, 2025 — Introduced · Congress.gov: “Introduced in House”
- Sep 18, 2025 — Referred to House Committee on Ways and Means · Congress.gov: “Referred to the House Committee on Ways and Means”
Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.
Money around this bill
2 lobbying clients named this bill on 3 disclosure filings across 2 quarters, Dec 2025 to Jun 2026. Those filings disclosed $440,000 in lobbying spend. A filing names 32 bills on average, so that figure is what each filing reported, not a share belonging to this bill.
More lobbying clients named this bill than 41% of bills with at least one filing.
Lloyd Smucker, the sponsor, reported $853,756 in PAC receipts in the 2026 cycle.
- National Roofing Contractors Association — $400,000 on 2 filings
- Signatory Wall and Ceiling Contractors Alliance — $40,000 on 1 filing
Lobbying Disclosure Act filings through Jul 21, 2026. A filing shows who paid to lobby on a bill it names, not what changed.
How this was measured
Analysis — Quorum's AI read the bill text published by Congress.gov (3,841 characters) on Sep 27, 2026. Section numbers in the findings refer to that text, linked below; transparency and hidden-provision scores are compared against the median of 16,222 analysed bills.
Status and sponsors — Congress.gov's bill record — actions, committee referrals and cosponsors — loaded nightly. The timeline shows status changes, not every procedural action.
Money — Senate Lobbying Disclosure Act filings whose specific-issue field names this bill for quarters ending Dec 2025 to Jun 2026. A filing's amount is reported whole beside the median number of bills a filing names; it is never divided across them. PAC receipts are FEC-reported contributions to the sponsor's candidate committee in the 2026 cycle.
As of — lobbying records through Jul 21, 2026 · page rendered 2026-10-20.
“Tax break for workforce training donors—but workers can't claim it” QuorumCivic. https://share.quorumcivic.app/bill/119/hr5493 Report an error
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