Hiring Incentives for Employers

Resources for Employers

Presidential Update for Companies Hiring Veterans: His proposed new "Returning Heroes Tax Credit" gives $2,400 to companies for each veteran they hire who has been unemployed for less than six months and $4,800 for those unemployed for half a year or more, administration officials said. And the existing "Wounded Warriors Tax Credit" -- paid out for hiring wounded veterans -- would be doubled to $9,600 for taking on someone unemployed for six months or longer.

Disabled Access Tax Incentives:  Small businesses are eligible for two tax incentives to help cover the cost of providing reasonable accommodations for employees or customers with disabilities, such as sign language interpreters, readers, materials in alternative format (Braille or large print), the purchase of adaptive equipment, the modification of existing equipment, or the removal of architectural barriers.  For more information about properly claiming this and other tax credits, refer to IRS Publication 334, Tax Guide For Small Business, and Form 8826, Disabled Access Credit.

Hiring Incentives to Restore Employment  (HIRE) Act: Did you get your tax credit for hiring an unemployed worker last year?  Employers who hired unemployed workers this past year (after Fed.3, 2010 and before Jan. 1, 2011) qualified for a 6.2% payroll tax incentive, in effect exempting them from their share of Social Security taxes on wages paid to these workers after March 18, 2010.  The employer and employee's shares of Medicare taxes would also apply to those wages.  Moreover, for each worker retained for at least a year, businesses may claim an additional general business tax credit, up to $1000 per worker, when they file their 2011 income tax returns. 

Work Opportunity Tax Credit Program (WOTC):  This provides eligible employers with a tax credit up to 40% of the first-year wages of a new employee.  This program encourages employers to hire targeted groups of job seekers by offering them a federal income tax credit. Targeted groups include veterans, summer youth, ex felons, Title IV-A recipients ( a member of a family who received Temporary Assistance to Needy Families (TANF) for any nine out of 18-month period ending on the hire date), Supplemental Nutrition Assistance Program (SNAP), SSI recipient, and Long-term Family Assistance recipients.  For most of this targeted group, this tax credit is in effect for new hires starting before Sept. 1, 2011. Refer to IRS Form 588. http://www.doleta.gov/business/Incentives/opptax/

Troops to Teachers: http://www.jobs2teach.doded.mil Schools can register to gain access to the Troops to Teachers database to search for recruiting new teachers and learn about the tax incentives for hiring veterans.

Federal Bonding Program: This program provides fidelity bonding insurance coverage to individuals with criminal histories and other high-risk job applicants who are qualified, but fail to get jobs because regular commercial bonding is denied due to their backgrounds.  The US Department of Labor (DOL) created this program to guarantee the job honesty of at-risk job seekers.  Federal financing of Fidelity Bond insurance, issued free-of-charge to employers, enables the delivery of bonding services as a unique job placement tool. Contact your State Employment Service for the for issuance of a federal bond from the DOL.

Note: This page was updated on 8-22-11.

Learn More About Employment Incentives in Your State

Sierra Group Foundation Project: http://employmentincentives.com/state_incentives/state_incentives_intro.htm#fl