On March 18th 2010 President Obama signed into law H.R. 2847, more commonly known as the HIRE Act of 2010. The HIRE acronym stands for Hiring Incentives to Restore Employment and has several components aimed at stimulating the economy. This law is quick on the heals of the Loss Carryback incentive that was part of the Worker Homeownership and Business Assistance Ac.
As a small business owner there are benefits in this law you should be aware of and plan on leveraging if your situation allows it.
Here are the highlights you need to know:
Municipal Bonds and Highway projects
The HIRE Act includes provisions to help spur investment in several capital projects including roads, bridges, schools and clean energy. If your business operates in these areas or you provide products/services to businesses in this sector, pay attention for upcoming opportunities.
Payroll tax savings
If you hire any workers who have been unemployed for at least 60 days your business will not pay their share of payroll taxes for the rest of 2010.
New hire tax credit
For any new employees that are with your company for at least a year the business will receive a $1,000 tax credit as long as their isn’t a drop of over 20% in that employees wages from the 1st half of the year to the 2nd half of the year.
Section 179 Deduction limits extension
The Section 179 deduction limit for 2010 was scheduled to drop to $134,000, however, the HIRE Act extends the 2009 deduction limit of $250,000 into 2010. What can this mean for your businesses equipment purchases? Assuming a 35% tax bracket, the cost of a $25,000 piece of equipment after tax savings would be $16,250. To learn more about the Section 179 Deduction and calculate your potential tax savings, use the free tool at Section179.info.
As businesses fight to catch the recovery wave, every bit helps. Investigate your options and consult your network to leverage these incentives.
Photo Credit: TheTruthAbout