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CREDIT FOR HIRING MILITARY VETERANS
For many years, the tax system has incented businesses to hire specific categories of disadvantaged workers, such as welfare recipients, retrained workers, and the like. In legislation enacted in late November, Congress has significantly expanded the tax credits available for hiring various categories of military veterans. These credits are generally based on 40% of the wages paid to the new worker, and require at least 120 hours of employment in the first year to gain any portion of the credit, and at least 400 hours to gain the maximum credit. There are five specific categories of veterans that qualify the employer for a tax credit, including several very broad definitions (i.e., those unemployed for as little as 4 weeks in the 12 months preceding hire, a veteran who was a member of a food stamp household, or a veteran unemployed at least 6 months in the preceding year). Each category of eligible veteran has a maximum credit amount, running from a low of $2,400 to a maximum of $9,600.
For many years, the tax system has incented businesses to hire specific categories of disadvantaged workers, such as welfare recipients, retrained workers, and the like. In legislation enacted in late November, Congress has significantly expanded the tax credits available for hiring various categories of military veterans. These credits are generally based on 40% of the wages paid to the new worker, and require at least 120 hours of employment in the first year to gain any portion of the credit, and at least 400 hours to gain the maximum credit. There are five specific categories of veterans that qualify the employer for a tax credit, including several very broad definitions (i.e., those unemployed for as little as 4 weeks in the 12 months preceding hire, a veteran who was a member of a food stamp household, or a veteran unemployed at least 6 months in the preceding year). Each category of eligible veteran has a maximum credit amount, running from a low of $2,400 to a maximum of $9,600.
