Employer Match for New Employees SS Waived and a $1,000 Credit

published April, 2010

If you hire unemployed workers after Feb 3, 2010 and before Jan 1, 2011, you may qualify to NOT PAY the employer match of 6.2% of Social Security taxes. The employee sill needs to have their 6.2% withheld. You’ll still owe the Medicare match of 1.45%

For each worker you keep for at least a year, your business may also claim a tax credit up to $1,000 per worker on your 2011 tax return.

This is NEW, and there are some restrictions on it. You can’t fire someone and replace them with a ‘qualified’ worker and get the credit, but if someone leaves voluntarily and is replaced by a ‘qualified’ worker, it is OK.

Qualified Workers have to have been previously unemployed for 60 days before beginning work, or worked fewer than 40 hours for someone else during the 60 day period. Did I mention this is NEW? The IRS is still developing a form to collect the required 60 day statement.

The credit will be reported/claimed on the second quarter Form 941.

I’ll send details as they become available—they’re still working this out.