Incentives to Hire The Unemployed
The HIRE Act (Hiring Incentives to Restore Employment), enacted March 18, 2010, is a plan to create jobs by providing a temporary tax break to companies that hire workers who were previously unemployed or worked part time. Two new tax benefits are available to employers:
- The payroll tax exemption. The first benefit provides employers with an exemption from the employer’s 6.2 percent share of social security tax on wages paid to qualifying employees. This benefit would be effective for wages paid from March 19, 2010 through December 31, 2010.
- The new hire retention credit. Businesses will also be eligible for a general business tax credit of 6.2 percent of wages paid to the qualified employee (employee must be retained for at least a year), up to a maximum credit of $1,000.
Visit the IRS website for more detailed information and check with your tax adviser on whether the new HIRE act applies to your company.