Under a SEMA-supported “jobs bill” enacted into law last March, private employers can claim tax credits if they hire someone in 2010 who has been out of work for at least 60 days. The federal government estimates the credit already applies to 4.5 million new workers hired between last February and May.
All businesses that hire an unemployed worker between February 5, 2010, and January 1, 2011, will be exempt from paying the 6.2% employer share of Social Security payroll taxes. The new worker must have been unemployed for at least 60 days and cannot replace another employee. If the business retains the newly hired worker for one year, the employer is then entitled to a one-time, $1,000 tax credit for each eligible worker.
The law also extended the “Section 179” expensing provision, allowing small businesses to write-off up to $250,000 of capital expenditures made during 2010 rather than recovering the costs over time through depreciation. The law also increases the investment cap to $800,000 for 2010 rather than $500,000 indexed for inflation.
For more information, contact Stuart Gosswein at stuartg@sema.org.