NEW TAX CREDIT INCENTIVES FOR EMPLOYERS TO HIRE VETERANS
It seems like everyone today likes to throw around the statement “Support Our Troops.” It’s a noble thought, and one that every American should heed. However, when it comes to employing our veterans after their service is completed, there appears to be a disconnect.
The Bureau of Labor Statistics puts the unemployment rate above 12% for veterans of recent wars, more than 3 points higher than the civilian market. While the unemployment rate in the United States remains high, currently 8.6% as of November 30, 2011, the rate for post-9/11 veterans stands just over 12% which translates to almost 240,000 veterans out of work. To address this issue, President Obama signed the Returning Heroes and Wounded Warriors Work Opportunity Tax Credit bill last month that provides significant tax credits to businesses that hire unemployed or disabled veterans.
Tax Credit Breakdown
The Returning Heroes and Wounded Warriors Work Opportunity Tax Credit bill creates four new categories of veterans who are eligible for Work Opportunity Tax Credit certification:
- Veterans who have received at least four weeks of unemployment benefits in the year prior to their hire. The credit is equal to 40 percent of the first $6,000 in wages paid to them, for a total of $2,400.
- Disabled veterans who have been discharged or released from active duty in the year prior to their hire. The credit is equal to 40 percent of the first $12,000 in wages, for a total of $4,800.
- Veterans who have received at least six months of unemployment benefits in the year prior to their hire. The credit is equal to 40 percent of the first $14,000 in wages, for a total of $5,600.
- Disabled veterans who have received at least six months of unemployment benefits in the year prior to their hire. The credit is equal to 40 percent of the first $24,000 in wages, for a total of $9,600.
The bill also supports transition-assistance planning and makes it easier for veterans to use their military skills to satisfy state licensing and accreditation requirements that often hinder employment.
Additional Resources for Veterans and Employers
The Department of Labor recently launched “My Next Move for Veterans,” a new online resource that allows veterans to enter their military occupation code and discover civilian occupations for which they are well qualified. The DOL also launched the “Veterans Job Bank,” a tool to help veterans find job postings from companies looking to hire them. This job bank already has over a million postings.
For employers, there are many websites that can be utilized to aid in the hiring of veterans. One site that is particularly helpful is “America’s Heroes at Work” http://www.americasheroesatwork.gov/forEmployers/HiringToolkit/. This user-friendly, interactive site walks employers through all of the steps necessary to hire returned veterans, such as creating position descriptions, developing recruitment strategies, and providing pointers on how to make workplace accommodations for wounded warriors.
While reducing the unemployment rate for all Americans should be a top priority of Congress, the passing of The Returning Heroes and Wounded Warriors Work Opportunity Tax Credit legislation provides additional incentives to employers to hire returning veterans, thereby supporting the troops at home as they enter the civilian workforce.