HIRE Act for Dummies
The Hiring Incentives to Restore Employment (HIRE) Act was signed into law on March 18, 2010. This provides incentives to companies who hire and retain unemployed employees. This act provides for:
- the elimination of the 6.20% employer portion of Social Security tax through the end of 2010.
- up to a $1000 Retained Worker Tax Credit (RWTC) for employees who stay employed for 52 consecutive weeks.
To be eligible for the credit, employees must sign an affidavit stating that they have not been employed for over 40 hours in the last 60 days prior to employment.
Other provisions include:
- Eliglible employees must have been hired after Feburary 3, 2010 and before December 31, 2010.
- FICA tax credits apply for wages paid between March 19, 2010 and December 31, 2010.
- Eligible employees cannot be family members of the business owner
- Eligible employees cannot be hired to replace another employee, unless that employee was terminated either voluntarily or for cause.
The RWTC will equal the lesser of 6.20% of eligile employees’ pay over the 52 week lookback period or $1000.
You may learn more about this act on the IRS web site. Click here for the HIRE Act Q&A for employers.