Hiring Incentives for Employers
Recently I received a request that asked if there were any "federal programs for hiring the unemployed". Through the course of my research, I found three programs that might entice employers to hire new employees regardless of the current state of the economy.
HIRE Act
Under the Hiring Incentives to Restore Employment (HIRE) Act, enacted March 18, 2010, two new tax benefits are available to employers who hire certain previously unemployed workers.
The first, referred to as the payroll tax exemption, provides employers with an exemption from the employer’s 6.2 percent share of social security tax on wages paid to qualifying employees, effective for wages paid from March 19, 2010 through December 31, 2010.
In addition, for each qualified employee retained for at least 52 consecutive weeks, businesses will also be eligible for a general business tax credit, referred to as the new hire retention credit, of 6.2 percent of wages paid to the qualified employee over the 52 week period, up to a maximum credit of $1,000.
Work Opportunity Tax Credit
The Work Opportunity Tax Credit (WOTC) is designed to promote the hiring of individuals who qualify as a member of a target group; for example, businesses can receive up to $2,400 in federal tax savings for hiring low-income individuals with barriers to employment. Two target groups have been established as part of the American Recovery and Reinvestment Act of 2009. These new groups cover unemployed veterans and disconnected youth who begin working for the employer in 2009 and 2010.
On-the-Job Training
On April 13, 2010, the New York State Department of Labor (NYSDOL) issued a Request for Application (RFA) for a new State On-the-Job Training (OJT) program. DOL has $2.8 million in State Workforce Investment Act funds to offer businesses under the OJT program. This program is designed to:
- encourage new hiring, especially of peoplewho are long-term unemployed
- help train these new hires
HIRE Act
Under the Hiring Incentives to Restore Employment (HIRE) Act, enacted March 18, 2010, two new tax benefits are available to employers who hire certain previously unemployed workers.
The first, referred to as the payroll tax exemption, provides employers with an exemption from the employer’s 6.2 percent share of social security tax on wages paid to qualifying employees, effective for wages paid from March 19, 2010 through December 31, 2010.
In addition, for each qualified employee retained for at least 52 consecutive weeks, businesses will also be eligible for a general business tax credit, referred to as the new hire retention credit, of 6.2 percent of wages paid to the qualified employee over the 52 week period, up to a maximum credit of $1,000.
Work Opportunity Tax Credit
The Work Opportunity Tax Credit (WOTC) is designed to promote the hiring of individuals who qualify as a member of a target group; for example, businesses can receive up to $2,400 in federal tax savings for hiring low-income individuals with barriers to employment. Two target groups have been established as part of the American Recovery and Reinvestment Act of 2009. These new groups cover unemployed veterans and disconnected youth who begin working for the employer in 2009 and 2010.
On-the-Job Training
On April 13, 2010, the New York State Department of Labor (NYSDOL) issued a Request for Application (RFA) for a new State On-the-Job Training (OJT) program. DOL has $2.8 million in State Workforce Investment Act funds to offer businesses under the OJT program. This program is designed to:
- encourage new hiring, especially of peoplewho are long-term unemployed
- help train these new hires
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