In addition to the skills and talents military veterans can bring to a company, did you know that they can also help your business earn tax credits?
Businesses that hire eligible unemployed veterans can take advantage of a Work Opportunity Tax Credit (WOTC). (This credit is also available to certain tax-exempt organizations.) The Returning Heroes Tax Credit provides incentives of up to $5,600 for hiring unemployed veterans, and the Wounded Warriors Tax Credit doubles the existing Work Opportunity Tax Credit for long-term unemployed veterans with service-connected disabilities, to up to $9,600.
Here are the various veteran-related tax credits your company could qualify for:
UNEMPLOYMENT TAX CREDITS:
- Qualified Long-term Unemployment: This is a credit for new hires in which the individual is employed no less than 27 consecutive weeks and includes a period in which the individual was receiving unemployment compensation under State or Federal law. For WOTC-certified new hires working at least 120 hours, employers can claim 25% of the first-year wages paid up to $6,000, for a maximum income tax credit of up to $1,500. For WOTC-certified new hires working 400 hours or more, employers can claim 40% of the first-year wages up to $6,000, for a maximum income tax credit of up to $2,400.
- Short-term Unemployment: A credit of 40% of the first $6,000 of wages (up to $2,400) for employers who hire veterans who have been in receipt of unemployment compensation for at least 4 weeks.
- Long-term Unemployment: A credit of 40% of the first $14,000 of wages (up to $5,600) for employers who hire veterans who have been in receipt of unemployment compensation for longer than 6 months.
WOUNDED WARRIOR TAX CREDITS:
- Veterans with Services-Connected Disabilities: Maintains the existing Work Opportunity Tax Credit for veterans with service-connected disabilities hired within one year of being discharged from the military. The credit is 40% of the first $12,000 of wages (up to $4,800).
- Long-Term Unemployed Veterans with Services-Connected Disabilities: A new credit of 40% of the first $24,000 of wages (up to $9,600) for firms that hire veterans with service-connected disabilities who have been in receipt of unemployment compensation for longer than 6 months. The credit can be as high as $9,600 per veteran for for-profit employers or up to $6,240 for tax-exempt organizations.
- Certain tax-exempt organizations can take advantage of WOTC by hiring eligible veterans and receiving a credit against the employer’s share of Social Security taxes.
Other perks for hiring Veterans: HIRE Vets Medallion Program To see how much your business can earn in tax credits, send us your information and we’ll send you some numbers! Reach out to Efficient Hire for details.
Efficient Hire is integrated with COATS Staffing Software – not only do we give you peace of mind by reducing risk, but we put money back into your operating budget with the Work Opportunity Tax Credit.