I found this piece by Deborah Solomon, published online today by the Wall Street Journal.
While accurate statistics will not be available until year’s end when companies complete the filing of their tax returns, anecdotal evidence suggest the HIRE Act’ 2010 Payroll Tax Exemption is far from being fully utilized by U.S. employers. In response, President Obama’s Treasure Department is expected to begin marketing the program more aggressively. The Obama Administration will also probably seek to extend the program beyond its current December 31, 2010 expiration date.
Note that Ms. Solomon characterizes the payroll tax exemption as a tax credit, which is not exactly accurate, but we can live with that!
Earlier this year, Congress approved a tax credit that rewards employers who hire those out of work 60 days or longer. Of the 15 million Americans now unemployed, about 6.8 million have been out of work longer than six months—more than at any time since the Labor Department began keeping track in 1948.
The Hiring Incentives to Restore Employment, or HIRE, exempts wages paid to qualifying workers from the employer’s 6.2% share of Social Security payroll taxes for the remainder of this year, and gives an additional $1,000 tax credit to employers for every worker they retain for 52 weeks.
The Treasury estimates that so far 4.5 million workers are eligible for the payroll tax exemption—a potential tax savings to employers of $8.5 billion—but Treasury officials worry businesses are unaware of the credit and might not take advantage before it expires in December. The administration will likely push for an extension.
According to the article, there are about 15 million Americans currently out of work. Of those, 6.8 million have been unemployed not only for 60 days but for longer than 6 month!
Please contact me, Vaughn Hromiko, with your questions about the HIRE Act’s Payroll Tax Exemption program. Reach me by e-mail at email@example.com or toll free at 800-655-5281, ext 101.