04/ 02/ 2008
by Matt Bolch
If you want to save money on next year's business taxes, remember one number: 8850. That's the one-page IRS form that you should ask new hires to sign as part of their new employee paperwork. The Small Business and Work Opportunity Tax Act of 2007 extended the Work Opportunity Tax Credit for hiring certain disadvantaged workers through Aug. 31, 2011, but many small business owners either don't know about the program or think it's too cumbersome.
The credit offers $2,400 for each new disadvantaged adult hire, $1,200 for each new summer youth hire and $9,000 for each new long-term family assistance recipient hired over a two-year period.
There are nine categories of qualification, including certain food stamp recipients, convicted felons and those who have received rehabilitative services. Only new workers are eligible, and paperwork must be submitted to the state Work Opportunity Tax Credit coordinator within 28 days of hiring.
More information on the Work Opportunity Tax Credit is available at www.doleta.gov/business/incentives/opptax.
This article is from the April/May 2008 issue of MyBusiness.
