 HARDING, SHYMANSKI & COMPANY Certified Public Accountants and Consultants
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| Upcoming Seminars | |
October 2010 - RSM MCREN Conference
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| Construction and Real Estate Industry | |
Because Harding, Shymanski is committed to providing quality service to our construction and real estate clients, we have selected a team of dedicated professionals to serve as your industry's consultants. These individuals understand the language and key issues unique to your industry and possess the drive and determination to help you manage your company on a proactive basis. |
| Indiana Enacts New Employer Tax Credit | |
Indiana has created a temporary new employer tax credit available against the corporate and personal income tax and the insurance premiums tax. The credit amount is equal to 10% of the wages paid by the new Indiana business to qualified employees during a 24-month period.
The credit may be claimed by a business that after December 31, 2009:
- either (a) locates or relocates the operations of a business enterprise in Indiana, (b) incorporates or otherwise first organizes in Indiana, or (c) expands the entity's operation of a business enterprise in Indiana;
- employs at least 10 qualified employees;
- makes an application to the Indiana Economic Development Corporation (IEDC); and
- is issued a certificate of approval by the IEDC.
It should be noted that a "new Indiana business" includes an existing business that expands operations.
A "Qualified Employee" is an individual who is a full-time employee, a resident of Indiana, and not more than a 5% shareholder/partner in the business. The term does not include rehired individuals or individuals employed to fill positions vacated as a result of layoffs during the past two years.
The IEDC will verify whether the business is employing at least 10 qualified employees in each month of the 24 month period for which the credit applies. In doing so, the IEDC may consider the applicant's employment levels in previous years to determine if the applicant is hiring new individuals or rehiring individuals. Based upon this criteria and the definition of qualified employee, it appears that the IEDC will look back two years to see where employment levels were, and only certify the business if the new hires exceed the employment level before any layoffs during that timeframe.
Please contact John Rittichier if you have any questions regarding this new credit. |
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| Hiring Incentives to Restore Employment (HIRE) Act | |
In an effort to confront high unemployment, the Hiring Incentives to Restore Employment (HIRE) Act provides incentives for hiring and retaining unemployed workers. Under the HIRE Act, a qualified employer's 6.2 percent share of OASDI Social Security tax liability is forgiven for new hires, and a general business credit is allowed for each retained worker that satisfies a minimum employment period.
Payroll Tax Forgiveness for Hiring Unemployed Workers. The HIRE Act provides relief from the employer share of OASDI taxes on wages paid by a qualified employer with respect to certain covered employment. Covered employment is limited to service performed by a qualified individual in a trade or business of a qualified employer, or in the furtherance of the activities related to the purpose or function constituting the basis of the employer's exemption under Code Sec. 501. This provision applies to wages paid beginning on the day after enactment and ending on December 31, 2010.
Although a qualified employer does not include the United States, any State, any local government, or any instrumentality thereof, a qualified employer may include a public higher education institution.
A qualified individual is any individual who: 1) begins work for a qualified employer after February 3, 2010, and before January 1, 2011; 2) certifies by signed affidavit (under penalties of perjury) that he or she was employed for a total of 40 hours or less during the 60-day period ending on the date such employment begins; 3) is not employed to replace another employee of the employer unless such employee separated from employment voluntarily or for cause; and 4) is not a related party.
Employers who qualify for the OASDI forgiveness in the first quarter of 2010 will receive the benefit through a credit toward general second quarter 2010 OASDI liability; they can't simply stop paying the 6.2 percent OASDI tax immediately on wages paid to new hires. After the first quarter, however, the employer does not pay the 6.2 percent tax as wages are paid.
A qualified employer may not receive the work opportunity tax credit on wages paid to an individual during the one-year period beginning on the hire date for the same wages used to qualify for the forgiveness of payroll tax. However, an employer may elect to not have payroll tax forgiveness apply.
Because payroll taxes are deductible as an ordinary and necessary business expense, employers may have a correspondingly smaller business expense deduction on their 2010 tax returns. By combining the benefit of the business credit for new hires with the forgiveness incentive, employers in the highest brackets will realize a net tax benefit of just over four percent of wages paid to qualified new employees, up to the $106,800 social security maximum wage base. Therefore, for the maximum $6,621.60 tax forgiveness for a new hire, a net benefit of approximately $4,304 would be realized.
Contact Alan Stabenfeldt, CPA, at (800) 880-7800 for additional information.
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| HSC offers assistance to Master Builder software users | |
Lisa Frank, CPA, Senior Consultant in Harding, Shymanski & Company, P.S.C.'s Outsourcing Department, is now a member of the Sage Master Builder Accountants Network. Through this membership Harding, Shymanski & Company, P.S.C. has access to a network of other accountants and Sage professionals serving the Master Builder family of users.
If you are a contractor needing assistance with Master Builder or have a software question, please contact Lisa Frank, CPA, at (502) 584-4142.
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| Upcoming RSM MCREN Conference and annual AGC of America conference | |
Three of HSC's Construction team members will be speaking at the 2010 RSM McGladrey Construction and Real Estate Network (RSM MCREN) Conference in Las Vegas in October of this year. Alan Stabenfeldt, David Papariella, and Randy Schulz will be serving on various panels at the MCREN conference.
New this year, the RSM MCREN conference date (October 20) is coordinated with the annual AGC of America conference for the convenience of attendees considering attending both conferences. RSM MCREN will host a reception at Caesars Palace on October 20th to include those attending the AGC/ CFMA 14th Annual Construction Financial Management Conference.
Mark your calendar and plan to attend!
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Harding, Shymanski & Company, P.S.C. provides accounting, tax, and consulting services to clients from offices in Evansville, Indiana, and Louisville, Kentucky.
We are committed to quality. Adding value to the services we provide is our most important goal. Our unwavering deducation and commitment to quality resonate throughout every aspect of our work.
Call us today! (800) 880-7800 in Evansville and (502) 584-4142 in Louisville
www.hsccpa.com |
| Disclaimer |
The information contained in this email is for general guidance on matters of interest only. The publication does not, and is not intended to provide legal, tax or accounting advice. |
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