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Tax Credits Blog

Do the Right Thing

****Make November the Hire Veterans Month.

With Veteran’s day on November 11th, let’s be proactive and hire a veteran for an open position in your company.  Not only is it the right thing to do considering all they gave for our freedom, but the Work Opportunity Tax Credit program will help pay for the hiring/training of the vet by giving the company a federal income tax credit as per the below schedule.

For-profit companies can get the following tax credit when they hire an unemployed veteran:

A.     If unemployed for at least 4 weeks but less than 6 months, with no service connected disability, the company will earn a tax credit equal to 40% of the first $6,000 paid to the vet - $2,400.

B.     If unemployed for more than 6 months with no service connected disability, the company will earn a tax credit equal to 40% of the first $14,000 paid to the vet – $5,600

C.      If the vet has a service connected disability and is hired within 1 year of separation from active duty, the credit is 40% of the first $12,000 - $4,800

D.     If the vet has a service connected disability and has been unemployed for more than6 months, the credit is 40% of the first $24,000 - $9,600

* unemployed periods are within the year prior to being hired and do not need to be consecutive.  Employees must work a minimum of 120 hours to qualify

Non-profit companies can also take advantage of this incentive as a reduction in the employer’s portion of Social Security (FICA) taxes.  Refer to the categories above:

A.     26% of the first $6,000 in FICA Earnings or $1,560

B.     26% of the first $14,000 in FICA earnings or $3,640

C.      26% of the first $12,000 in FICA earnings or $3,120

D.     26% of the first $24,000 in FICA earnings or $6,240

* unemployed periods are within the year prior to being hired and do not need to be consecutive.  Employees must work a minimum of 120 hours to qualify.

There are many organizations that can help you hire the right veteran including the Veteran organizations in your city or town, online organizations like www.Veterans2Work.com and others.

Veterans bring discipline, teamwork, mission focus and the ability to learn quickly.  Hiring a vet is just good business.  We want to make sure you also get the icing on the cake – all the credits you’re entitled to. If you need help in qualifying a veteran for the Work Opportunity Tax Credit program, please let me know.

Sincerely,

Ken Brice, President

EmployerIncentives.com

US Navy, Vietnam Vet