Tax Incentives Available
The HIRE Act includes two possible tax credit incentives for businesses:
- Payroll Tax Exemption - For unemployed workers hired this year (after February 3, 2010 through December 31, 2010), employers can receive a 6.2% payroll tax incentive. This exempts employers from paying the employee's share of Social Security taxes on wages paid to their new hires after March 18, 2010. (Details from the IRS)
- Employer Tax Credit - Employers may claim a general business tax credit of up to $1000 per previously unemployed worker retained for at least one year. This credit should be filed on the employer's 2011 income tax return. (Details from the IRS)
Businesses that have hired - or intend to hire -- unemployed workers during the time period from February 3, 2010 and before January 1, 2011, and wish to claim tax credits under the HIRE Act of 2010 must meet the following criteria:
- Workers must be hired after February 3, 2010 and before January 1, 2011.
- Workers must have been unemployed for at least a 60 day period before beginning work or cannot have worked more than 40 hours for anyone during the 60 day period.
- New hires must be employed for either a new position or by filling an existing position by replacing a worker who left voluntarily or was terminated for cause.
For more information on HIRE Act qualifications, benefits, and making your claim, please refer to the IRS website.