GET YOUR HIRE ACT TOGETHER
Recently we spoke with a franchisee who collected on tax benefits last year that were legislated by the Hiring Incentives to Restore Employment (HIRE) Act, which encouraged employers to hire certain previously unemployed workers (“qualified employees”). But he mined from only one of the two tax-credit mother lodes entrenched within it.
The gap between what he collected and what he could have collected was more than $30,000. Don’t make this same mistake. Don’t forget to capitalize on the general business tax credit, referred to as the new hire retention credit.
A new hire retention credit amounts to 6.2 percent of the wages paid to the qualified employee who is retained for at least 52 consecutive weeks – or $1,000, whichever is the lesser amount. (Wages during the last 26 weeks of employment must be at least 80 percent of the wages paid during the first 26 weeks.)
While the HIRE Act was not extended past 2010, workers hired between March 19 and December 31, 2010, remain eligible for the new hire retention credit through the end of 2011.