What Does The Jobs Bill Do For My Small Business?

Business Survival Tip
Episode 37
By Carl Kleimann
April 7th, 2010

Full Interview transcript

Carl: Hello business owners this is Carl Kleimann from Odyssey OneSource with another Business Survival Tip. On March 18th, President Obama signed the new JOBS bill into law with hopes of reducing unemployment. Also known as the Hiring Incentives to Restore Employment Act, this new law includes $17.5 billion in tax cuts, business credits and government subsidies. The tax cuts are of particular interest to business owners so let me address those.

To promote the hiring of unemployed workers, the new law exempts any private-sector employer that hires a worker who has been unemployed for at least 60 days, from having to pay the employer’s 6.2% share of Social Security tax on that employee. This exemption is valid for the remainder of 2010. A company could save as much as $6,621 if it hired a qualifying worker and paid that worker at least $106,800 – the maximum amount of wages subject to Social Security tax – by the end of this year.

As an additional incentive, up to a $1,000 income tax credit is available for each qualified worker hired under this initiative that the employer keeps on payroll for a continuous 52 weeks. This credit can be used on the employer’s 2011 tax return. In order to be eligible for this tax credit, the employee’s pay in the second 26-week period must be at least 80% of the pay in the first 26-week period.

This program is available to private sector employers, including non-profit organizations. There is no minimum weekly hours that the new employee must work in order to be eligible. You must obtain a signed affidavit from the employee stating that he or she has not been employed for more than 40 hours during the 60-day period ending on the date that employment begins. The savings are immediate.

I am Carl Kleimann and this has been another Business Survival Tip by Odyssey OneSource, ranked as the number one Professional Employer Organization three years running by the Black Book of Outsourcing.
For more information on this and other issues affecting employers, please visit www.odysseyonesource.com