A tax benefit available for business owners who hire unemployed workers may help employers when it comes to employee payroll taxes. According to the IRS website, a employer who hires unemployed workers may receive a payroll tax incentive which essentially exempts them from paying their share of Social Security taxes on wages for workers.
The article warns that even though this will not reduce employees Social Security benefits the employer should still withhold their employees’ share of Social Security taxes, as well as, income taxes.
Also, for each worker retained for a least a year a business may claim an additional tax credit for up to $1000 per worker when they file their 2011 taxes. These tax incentives can be beneficial for business owners who may be looking to hire new employees, as it would not only allow employers to have a bit of a tax break but also it would help to cut down on the unemployment problem by requiring that workers who have been unemployed more than 60 days fill these open jobs.
Some business owners may have been hesitant to hire new workers due to the costs they may incur by doing so, but this tax incentive should give employers motivation to add more workers to their company and help those who have been unemployed by giving them the opportunity to go back to work.
Business owners that may want to take advantage of this tax credit should consult the IRS website to see what requirements are needed and what qualifications an unemployed worker must meet in order to take advantage of this tax credit.