Beginning in 2026, a new state income tax credit takes effect that will support Louisiana employers who provide work-based learning experiences for apprentices, interns and youth workers.
This new law, created by Act 376 of the 2025 regular session, repeals two existing and underutilized credits and replaces them with the new and enhanced Work-Based Learning Tax Credit. It both expands the prior credits and supports work-based learning requirements in the state’s new school accountability system.
Louisiana lags well behind other Southern states in the number of young people participating in internship and apprenticeship programs, even though they can be an important component in the workforce pipeline. That’s why Better Louisiana wants Louisiana businesses to be aware of this new credit and learn more about how it can help them meet their workforce needs.
In looking around the country it is clear that expansion of work-based learning opportunities for high school students is the wave of the future. For students it allows them to learn in a real-world setting, enhance their skills, and improve their employment opportunities.
Louisiana’s Board of Elementary and Secondary Education recognized this in 2024 when it approved a new school accountability system that places a greater emphasis on high schools offering work-based learning experiences to their students. That system went into effect with the start of the current school year. A student who earns work-based learning points under the accountability system would also qualify their employer for the tax credit.
The credit is available to businesses who make eligible hires in 2026. They can claim the credit on their tax returns beginning in 2027. For the current tax year, the total tax credit available to be claimed is $1 million, which is allowed to grow to a maximum of $7.5 million in future years based on utilization. Because of this cap, applications for each tax credit will be approved on a first-come, first-served basis and it is important that businesses apply for the credits as early as possible in 2027.
Act 376: What It Does
- Establishes a tax credit for businesses that employ registered apprentices, interns, or youth workers.
- The amount of the credit is $2.50 per hour worked, up to a maximum of $2,500 per eligible worker per year.
- Employers must employ the individual for at least 100 hours in the tax year to qualify.
- Any credit that exceeds a company’s Louisiana tax liability can be carried forward for up to 5 years.
Policy Goals & Outcomes
For decades many European countries have been leaders in connecting high school students to the workforce with positive results for both the students and businesses involved. Those benefits are now being more fully recognized in the U.S. where states and the federal government are beginning to take a more active role in encouraging apprenticeships and internships.
This is of particular significance in Louisiana which has a serious leakage in the pipeline of students who transition from high school to postsecondary education and the workforce. This was highlighted in a Better Louisiana report from last year which indicated that of the 44,000 students enrolled in Louisiana high schools in 2022, 50% are believed to have gone straight into the workforce without a postsecondary credential or work-based learning experience.
This means that in many cases the young workers businesses are hiring do not have the skills the company needs and more training is required. For students entering the workforce it means their career and earning opportunities are more limited.
Act 376 is intended to help address both of those issues. By reducing the cost of hiring apprentices, interns and youth workers, business can begin to build their future workforce now. Giving students real-world work opportunities early exposes them to job opportunities inside Louisiana and increases the likelihood that they will stay in the state as their careers progress.
More detailed information is available from the Louisiana Department of Revenue through Work-Based Learning Tax Credit Bulletin #25-028.