Employer News
Need Help Getting Workers? Use This Tax Credit to Pay a Hiring Bonus Gene Marks The economy is quickly recovering from the pandemic and many small business owners are seeing an increase in demand. But, thanks to stimulus checks, higher unemployment compensation and continuing health and safety fears, many employers are finding it difficult to entice their workers back to their jobs. Some larger employers – from restaurant chains to Wawa – have been offering hiring bonuses. But can small businesses who are still struggling to get back on their feet afford the same? Thanks to a little-known federal tax program, the answer may be yes. The program is called the Work Opportunity Tax Credit. It’s been around for a number of years but was extended in last December’s stimulus bill through the end of 2025. The credit — which reduces the
20
amount of federal taxes owed — can be a lucrative recruiting tool for small businesses who want to pay hiring bonuses to prospective employees. “Many of our clients have been im-
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pacted adversely by COVID-19 and have looked to us for ideas to cut down on costs in order to keep their doors open,” says Rebecca Norris, CPA a tax manager at Isdaner & Company, LLC in Bala Cynwyd. “The program is one of the money-saving tools we recommend to these clients.” The tax credit is available to employers that hire certain types of employees, such as those coming off of welfare or a “qualified” veteran, which includes ex-service personnel who were unemployed for anywhere from four weeks (whether or not consecutive) to at least 6 months over the past year. The list of eligible workers also includes ex-felons, qualified social security insurance recipients or those that have been receiving long-term welfare assistance from the government.
