Health Care Bill – What It Means To You

Like it or not, on March 18, 2010 President Obama signed The Hiring Incentives to Restore Employment Act (HIRE) known also as the “Jobs Bill.”  The goal of this Act is to create jobs by providing a temporary tax break to companies that hire the unemployed.

Things You Should Know:

•  The HIRE Act will exempt an employer from paying the employer portion of Social Security taxes for the remainder of the year on new hires who were previously unemployed.  A qualified employee is one who meets the following requirements:
  • The employee begins employment with a qualified employer after February 3, 2010, but before January 1, 2011.
  • They must not have been employed for a total of more than 40 hours during the previous 60 days.  (The individual must sign an affidavit attesting this is true.)
  • They were not hired to replace another employee unless the previous employee was separated from employment voluntarily or for cause.
  • The hire staff member can not be a family member of the business owner.
• The 6.2% employer portion of the Social Security tax would be exempt for any qualified individual hired after February 3, 2010 and before January 1, 2011, for wages paid in 2010 up to the $106,800 Social Security wage base.  Employers may begin claiming this tax credit on their second quarter 2010 941 tax return.
•  A business tax credit can be claimed by the employer for each qualified individual who stays with the employer 52 weeks.  The credit is the lesser of $1,000 or 6.2 percent of the wages paid to the retained worker during the 52 week retention period. Wages paid during the second 26 week period must equal at least 80 percent of wages paid during the first 26 week period. 

That’s what you need to know. The question is, do you think this will encourage you to hire the unemployed?