HomeNewsBlogBlogsHire a Veteran - Save Up to $9,600 in Taxes

Hire a Veteran - Save Up to $9,600 in Taxes

Written by Bill North Tuesday, 21 February 2012 08:43
Currently, there are nearly 1 million unemployed veterans in the United States. This number is expected to increase significantly with the withdrawal of troops from Iraq. Congress passed the Vow to Hire Heroes Act, which was enacted as of November 21, 2011. This act expands the Work Opportunity Tax Credit for businesses and is even available to certain tax-exempt organizations. What is significant about this new act is that it employers will have more time to file the required certification form to the State.
Historically, the Work Opportunity Tax Credit required businesses to submit the certification form (Form 8850) to the state workforce agency within 28 days of being hired. This requirement was often the number one reason why employers failed to receive the credit. The new act expands the 28 day reporting window for hiring veterans. The main details of the new act are as follows:
  • The credit can be up to $9,600 per veteran. The credit depends on a number of factors, including the length of time the veteran was unemployed and the amount of the first-year wages paid.
  • Veterans hired between November 22, 2011 and May 22, 2012 – Employers will have until June 19, 2012 to submit the newly revised Form 8850 to the state workforce agencies. Veterans hired after May 22, 2012 will have to comply with the normal 28 day reporting rule.
  • A qualified veteran is generally an individual who has served on active duty in the U.S. Armed Forces for more than 180 days or have been discharged or released for a service-connected disability.
  • Details regarding the amounts that can be claimed per veteran can be found in IRS Notice 2012-13 and the new instructions of the newly revised Form 8850.
  • The new act now allows employers to file Form 8850 electronically or by fax if the state workforce agency has the ability to accept those formats. Contact your tax professional if you already have or are considering hiring a qualified veteran!

William E. North II, CPA, CCIFP is a Principal in the Sarasota, Florida office of Hill, Barth & King LLC.
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Bill North

Bill North

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