Academic journal article Journal of Accountancy

Connecting with "Disconnected Youth"

Academic journal article Journal of Accountancy

Connecting with "Disconnected Youth"

Article excerpt

With Notice 2009-28, 2009-24 IRB, issued May 28, the IRS further defined "disconnected youth," and unemployed veterans under the American Recovery and Reinvestment Act of 2009 (ARRA), which added both groups to those for which employers may claim the section 51 work opportunity tax credit. The credit, part of the general business credit, is equal to 400/0 of the wages of such individuals during their first one-year period of employment, up to $6,000 per employee ($12,000 for certain veterans). The statute defines disconnected youth as individuals who are:

* Between ages 16 and 25,

* Who were not regularly employed or attending any secondary, technical or postsecondary school during the six months preceding the hiring date, and

* Who are not readily employable because they lack a sufficient number of basic skills.

The statute did not define an insufficient number of basic skills that prevents a young person from being readily employable. The notice states that individuals meet this qualification if they state in writing that they do not have a certificate of secondary school graduation or a GED or, if they do have one, they received it six months or longer ago and haven't held a job in the meantime.

The notice also defined a secondary, technical or postsecondary school; what constitutes regular attendance at them; and a previous lack of regular employment. The latter provision is met by individuals who earned less than the equivalent of the federal minimum wage (or state minimum wage, if higher) at 30 hours a week throughout each of the previous two consecutive three-month periods. The federal minimum wage was scheduled to increase on July 24 from $6.55 to $7.25 per hour. Thus, a person who earned the federal minimum wage for 30 hours a week from May 1 to July 31, 2009, would have received $2,575. …

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