President Obama signed the HIRE Act Jobs Bill into law on Thursday. This bill encourages businesses to hire employees, but it may not be 
enough. According to CNNMoney, here are some of the bill's features that might affect you:
You Get a Break on Payroll Taxes if You Hire Unemployed Workers
- Companies will be exempt from paying their share of the Social Security portion of FICA taxes (6.2% of gross pay) for the rest of this year for any new worker who was unemployed for the prior 60 days. The worker will still have to pay his or her share of the tax.
- Each of those new employees retained for a full year would net the company an additional $1,000 back on its 2011 tax return, or 6.2% of the wages paid to the employee in 2010, whichever is less. Companies of any size can claim the credits, for an unlimited number of workers.
You Can Take Higher Depreciation Deductions for Buying Equipment in 2010
- The legislation also extends the increased Section 179 deduction, allowing businesses to take a depreciation expense for up to $250,000 of capital expenditures in 2010. This deduction previously was stopped at the end of 2009. Extending the provision encourages companies to buy assets like vehicles and machinery this year.
I will keep you up to date on the provisions of this bill as it becomes available
Image: Mark Wilson/Getty Images
I’m starting a one year contract job tomorrow and have been unemployed since 9/1/09. My new employer urged me to fill out the affidavit and send it back to them because I would benefit from this bill (I just accidentally typed bull but should have left it in my comment nonetheless).
So people don’t fall into the trap that I did thinking they will benefit themselves (other than of course starting a new job after months of depending on food banks and unemployment cuts, 97 job interviews ending in three offers, two of which were insults etc.) don’t rush to spend what little change you may have in your pocket via fax to any distance employer (they’re on the east coast, I’m on the west and it cost me 2 bucks to fax it from Fedex Kinkos Office). What a waste of my time!
Since you said “contract” job, I’m wondering if this is a real employee position or an independent contractor position, which is not eligible for the HIRE Act benefits for employers.
Due to the economy’s downturn beginning in 2008, our company was hard hit, and we had to layoff several employees. Our business has been improving in recent month’s, and we’ve been able to recall some of these laid off people, several of whom did not find other employment during their 18 months of layoff. Should these recalled personnel be qualifiable under the new Hire Act?
The IRS says:
Qualified employees are individuals who begin employment with a qualified employer after February 3, 2010, and before January 1, 2011, who have been unemployed or employed for less than 40 hours during the 60-day period ending on the date such employment begins, and who are not family members of or related in certain other ways to the employer.
So it looks like your employees who were laid off could count as being qualified for this tax credit. There is an affidavit (Form W-11) that the newly hired employee must sign affirming that they meet the qualifications (unemployed during the 60-day period before being employed by your company):
http://www.irs.gov/pub/irs-pdf/fw11.pdf
we have 2 gentlemen that are retired and came to work for us this past summer for a season job (we are a youth baseball organization). Does their retirement pay count as being employed?
I think what you are asking is if you have to count retirement pay (pension) when you figure their limit for pay for Social Security purposes. If they receive a pension from a previous employer, that doesn’t count toward “pay” for Social Security purposes.
I started a new job back in the middle of May after being unemployed since the middle of April. I filled out a whole stack of new hire paperwork and I wasn’t informed that one of the many pages were inquiring about my previous employment for the HIRE act. I see on my W2 that I now have the CC code listed under section 12, but I don’t think I qualify for that because I was only unemployed for about 30 days. Does having the CC code on your W2 effect the outcome of your tax return as an employee?
Thank you!
Having a CC code on your W-2 shouldn’t affect your taxes. It has to do with your employer to say that wages paid to you are exempt from the employer’s portion of Social Security tax. Since it doesn’t affect your portion of the tax, it should have nothing to do with your tax return.
I filed my return yesterday morning from my laid off employer I was going to get a large return back, but once I started filing the jobs from temp companies, and filling in box 12 with a CC code I was losing big time, this hurts the little guy and business excel again, is there any help for us who are struggling to get by?????