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Did you know that on average, 15 percent of today’s job hunters qualify for a federal or state employment tax credit? By hiring individuals from targeted groups that have particularly high unemployment rates or special employment needs (i.e., veterans), you can receive a credit ranging from $2,400 to $9,600 per employee. But businesses must act now – unless Congress extends these benefits, qualifying employees must begin working before Jan. 1, 2013.
In general, the Work Opportunity Tax Credit (WOTC) rewards employers with a tax credit for hiring individuals from targeted groups. The WOTC was extended and enhanced again in November 2011 by President Obama, who signed into law a series of legislation geared toward veterans, including the 2011 Vow to Hire Heroes Act.
Although we are dealing in uncertain times, indications are favorable that legislators will renew the employment tax credits set to expire for qualified veterans on Dec. 31, 2012. Additional credits may also come available if the legislation geared toward non-veteran groups that expired in 2011 is renewed.
For now, qualified employees must be hired before year-end, and employers must file the proper paperwork with the Department of Labor within 28 days of hiring the qualified employee in order to claim the credit.
The current credit is generally limited to eligible veteran employees who begin work for an employer before Jan. 1, 2013:
Tax Credits Available
|Veterans receiving food stamps and certain veterans with service-connected disabilities||$9,600 per employee|
|Veterans who have been looking for employment for more than six months||$5,600 per employee|
|Veterans who have been looking for employment for less than six months||$2,400 per employee|
Additionally, if the legislation qualifying non-veteran groups is reenacted, you could receive up to $2,400 in tax credits for qualified employees such as:
Whether you aim to take advantage of these credits before year end, or pursue credits should they be extended, Doeren Mayhew’s dedicated Tax Incentives Group includes Troy, Houston and Ft. Lauderdale CPAs to handle your employment tax credit processing. For more information, contact us.
This publication is distributed for informational purposes only, with the understanding that Doeren Mayhew is not rendering legal, accounting, or other professional opinions on specific facts for matters, and, accordingly, assumes no liability whatsoever in connection with its use. Should the reader have any questions regarding any of the news articles, it is recommended that a Doeren Mayhew representative be contacted.
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