HIRE Act incentives require action by year end

Description

Abstract: In March, two provisions of the Hiring Incentives to Restore Employment (HIRE) Act became law, providing incentives for hiring and retaining workers: 1) payroll tax forgiveness, which essentially exempts qualified employers from having to pay the 6.2% Social Security portion of Federal Insurance Contributions Act (FICA) taxes on certain new hires, and 2) a retained worker tax credit. But hires must be made by year end — and the sooner this is done, the more tax savings will result. This article explains how these two breaks work and offers some tips on deciding whether to bring on new employees. A sidebar discusses the act’s extension of 2009’s higher Section 179 expensing limits.