Despite the sagging economy, there are many companies that are in hiring mode. What they may not know is that a number of Employment Tax Credits exist that could significantly add to their bottom line.
These tax credits have the potential to be very lucrative for a business, but often the company is not even aware they exist. Employment tax credits can also be complex to identify and recoup. Or a company simply lacks the knowledge and manpower to tap these highly valuable incentives provided by the government to spur hiring.
In an exciting new phase for McGuire Sponsel, we have partnered with Honkamp Krueger & Co., P.C., to help tap these incentives. Our combined team is set up to research, apply and recoup your clients' tax credits for you. We can uncover the tax credits for which companies are qualified, and untangle "government speak" so your clients understand everything about the process.
At the end of 2010, Congress extended many great employment tax programs with the passage of the "Tax Relief Act." Here is a snapshot of current employment tax credits McGuire Sponsel can aggressively pursue for your clients.
Federal
Work Opportunity Tax Credit (WOTC) Program: Up to $2,400 in tax credits per employee, in some cases up to $9,000. A company may qualify if it has employees who fit in these categories:
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Short Term Temporary Assistance for Needy Families (TANF)
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Veteran on governmental assistance or disabled veterans
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Vocational rehabilitation referral
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Summer or high-risk youth
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Ex-offender
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Supplemental Security Income recipient
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Food stamp recipient
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Enterprise Zone resident
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Long Term Temporary Assistance for Needy Families (TANF) – up to a $9,000 credit!
Empowerment Zone: Up to $3,000 in tax credits per qualified employee each year. Once you qualify a new hire for the Empowerment Zone, they will continue to earn the company $3,000 in credits each year the employee stays with the company.
State
State tax codes vary, but commonly pursued tax credits include:
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Enterprise Zone credits
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Hiring disadvantaged workers
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Hiring credits and refunds
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Job creation credits
Certain industries tend to benefit more from employment tax credits. Businesses with more than 100 employees and a high rate of turnover usually receive the biggest benefit from the federal and state employment tax credits. Examples include:
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Staffing
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Call Center
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Health care
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Convenience store
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Hospitality
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Restaurants and food chain