image: BP blast header
 
Greetings!
 
Contact Us
 
President
425.289.7608
 
President of Wealth Management and Consulting
425.289.7601
 
 
Directors:
 
Business Transition and Valuation Services
425.289.7613 
 
State and Local Tax Services
425.289.7609
 
Forensic, Litigation and Investigation Services
425.289.7617
 
John Launceford
Estate and Financial Planning Services
425.289.7602
 
Assurance Services
425.289.7608
 
Tax Services
425.289.7607
 
toll free: 800.876.6931
Join Our Mailing List
New Federal Tax Incentives for Businesses
  

On March 18, 2010, President Obama signed the Hiring Incentives to Restore Employment (HIRE) Act (H.R. 2847). The new law contains several major tax incentives for small and mid-sized businesses.
 
Hiring and Retention Incentives
 
Payroll Tax Forgiveness
Employers are exempt from the 6.2% Social Security tax on any qualified employee's wages from March 18, 2010 through December 31, 2010.
 
A "qualified employee" is an individual hired after February 3, 2010, that has not been employed for more than 40 hours during the preceding 60-day period ending on the date of hire. The qualified employee may not replace a current employee unless the current employee left voluntarily or was fired with cause.
 
Employers are still liable for the 1.45% Medicare tax on qualified employees' wages. Additionally, employees related to the employer or who own 50% or more of the company are ineligible.
 
There is no limit on the number of hours a qualified employee must work to qualify for payroll tax forgiveness, nor is there a limit on the number of qualified employees a company may hire.
 
Retention Credit
Employers that hire individuals that qualify for payroll tax forgiveness and retain them for 52 consecutive weeks may qualify for a tax credit equal to the lesser of $1,000 or 6.2% of the wages paid to each qualified employee. 
 
Asset Acquisition Incentive
 
Code Sec. 179 Expensing
Businesses with qualifying property purchases may expense up to $250,000 of new property purchased during 2010 rather than depreciating it over several years.
 
Total asset acquisitions in excess of $800,000 reduce the expense dollar for dollar, completely phasing out the expense at $1,050,000 of acquisitions. 
 
Professional Help
This new law creates opportunities with tax incentives for your business. Please contact your Berntson Porter tax professional or Dave Berthon, CPA, MAcc (Tax) at 425.454.7990 or [email protected].

 
image: Berntson Porter & Company logo
 
425.454.7990     fax: 425.454.7742
image: Copywright 2010 Berntson Porter & Company, PLLC
Thank you for subscribing to BP blast. Berntson Porter & Company will never sell or share your email address with anyone.
 
In accordance with applicable professional regulations please understand that any written advice contained in, forwarded with, or attached to this email is not intended or written by Berntson Porter & Company, PLLC to be used, and cannot be used, by any person for the purpose of avoiding any penalties that may be imposed under the Internal Revenue Code.