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Latest Tax News

The 2010 Hiring Incentives to Restore Employment (HIRE) Act

On March 18 President Obama signed into law the Hiring Incentives to Restore Employment (HIRE) Act, in an effort to boost employment of unemployed individuals. This act contains provisions that will benefit a business that hires new employees after February 3, 2010.

 

Some highlights from the new law are:

•  Employers can save the 6.2% employer portion of social security tax if they hire a qualified person to fill a new position or an existing position if the previous occupant left voluntarily or for cause. Employers will claim the tax benefits on their quarterly Form 941 that they file with the IRS.
• Employers will receive a $1,000 tax credit on their 2011 income tax returns, if they retain the employees for 52 consecutive weeks.
• Qualified employees are defined as individuals hired after February 3, 2010 and before January 1, 2011 who have been unemployed or worked less than 40 hours during the last 60-day period prior to when the new employment begins and who are not family members or related in certain other ways to the employer.
• An employee who was previously laid off and rehired may be qualified if they meet the above requirements.
• The employee must certify that they qualify by signing an affidavit. Form W-11 (http://www.irs.gov/pub/irs-pdf/fw11.pdf) was created to meet this requirement.

 

Additional information on how the HIRE Act will affect a businesses payroll is included in this newsletter.

 

Please contact your tax advisor if you have questions regarding this new legislation or how to take advantage of these benefits.

 

More detailed information can also be found at http://www.irs.gov/businesses/small/article/0,,id=220745,00.html

 

 

2010 Haiti Relief Donations Deductible for 2009

New law provides taxpayers the option to claim charitable cash contributions made between January 12, 2010 and February 28, 2010 as a charitable deduction on their 2009 federal tax return. To qualify, contributions must be made to a domestic legitimate charitable organization that is assisting Haiti. For more information regarding qualified legitimate organizations and required documentation please contact one of our many tax advisors.

COBRA Assistance Coverage Under ARRA Amended March 2, 2010 Extends Subsidy Period and Expands Eligibility

The American Recovery and Reinvestment Act of 2009 (ARRA), as amended March 2, 2010 by the Temporary Extension Act of 2010 (TEA), extends the COBRA qualifying event period to March 31, 2010. In addition, those individuals who had a COBRA qualifying event due to a reduction in hours between September 1, 2008 and March 31, 2010 and were involuntarily terminated anytime between March 2, 2010 and March 31, 2010 are now eligible for the subsidy. The maximum period for receiving the subsidy remains at 15 months. These amendments may require additional notices to be provided to qualified individuals. For more information on how this impacts you contact us or go to http://www.dol.gov/ebsa/COBRAmodelnotice.html.