The Hiring Incentives to Restore Employment (HIRE) Act, which became law on March 18, 2010, offers temporary payroll tax breaks to employers for hiring previously unemployed individuals. It also extends a business tax credit for retaining those qualified individuals for at least 52 weeks.

The new law offers a temporary tax holiday from the 6.2% Social Security payroll tax on "qualified individuals." Here are the basic rules:

• Qualified individuals must be hired after February 3, 2010 and before January 1, 2011;
• Each qualified individual must certify by signed affidavit, under penalty of perjury, that they were not employed for more than 40 hours during the 60-day period prior to the start date of employment;
• The employer must ensure the individual is not related to the employer as defined by the law; and 
• The tax exemption applies only to wages earned from the enactment date (March 18, 2010) through December 31, 2010.

Under the HIRE Act employers are also eligible for a $1,000 business tax credit for each qualified individual retained at least one year (52 consecutive weeks).  This tax credit would be claimed on the 2011 business income tax return.

ALTRES clients may rest assured we are prepared to assist your organization in taking advantage of these benefits.  Please contact our Client Care Center or your ALTRES HR representative for details.  

For more information, please visit http://www.irs.gov/businesses/small/article/0,,id=220745,00.html