HIRE Act Incentives

As a response to the county’s economic slowdown and record unemployment, Congress passed a broad reaching emergency measure to spur new hiring only in 2010. Tax credits were available for new hires that were unemployed more than 60 days, and included both hefty payroll tax reductions. These credits must be claimed on 2010 tax filings.

The Stakes

Maximum credits for HIRE Act can amount to $6,621 per employee with another $1,000 available in general business credits for qualified employees who remain at your company for 52 weeks.

Realizing that 20-35% of all new hires qualify for HIRE Tax Credits, most companies now hiring can realize substantial federal income tax credits for 2010. This new revenue  can position companies well to thrive as the economy improves.

The Rules

HIRE Act is unprecedented in that it provides benefits to non-governmental, not-for-profit organizations and even public universities. Under authority of the IRS, there is no certification process, businesses self-certify. The following eligibility rules apply:

For an employee to qualify for the Social Security Tax exemption, they must:

• Be hired on or after Feb 3rd, 2010 and before Jan 1, 2011.
• Work less than 41 total hours over the 60 days prior to the first day of work.
• Not be hired to replace another employee UNLESS the previous employee quit or was fired for cause (per IRS guidance this also includes certain layoffs.)

For the retention credit, the employee must meet the above AND:

• Be employed with the company for 52 consecutive weeks.
• Wages from the second 26 weeks of employment must be at least 80% of first 26 weeks.

Point-of-Hire Portal Maximizes HIRE Act and All Employee-Based Credits

Tax Credit Co.’s clients enjoy the advantage of the most powerful point-of-hire screening and administrative solution in the market. Tax Credit Co.’s Tax Incentive Portal (TIP) enables HR and Financial Management to not only assist companies to identify qualification, certification, calculation and claims of tax incentives, but will track and manage all paperwork and electronically signed documentation.

Imagine being able to:

• View, filter and export tax credit calculations in real-time
• Manage compliance in real-time
• Automatically assign unscreened hires to hiring managers for screening

TIP will save HR and accounting functions an enormous amount of time and money. We encourage you to explore all its industry leading functionality.