Magazine article Strategic Finance

HIRE Act Signed into Law

Magazine article Strategic Finance

HIRE Act Signed into Law

Article excerpt

The House passed the HIRE (Hiring Incentives to Restore Employment) Act previously passed by the Senate but made some changes in it, meaning the bill was tossed back to the Senate for one more vote. The Senate passed the bill, and it was signed by President Obama on March 18. The HIRE Act allows employers to forego paying their 6.25% share of federal payroll taxes for the rest of 2010 for any new workers they hire as long as the new hires had been unemployed for at least 60 days. For example, according to Senate Finance Committee Chairman Max Baucus (D.-Mont.), a large manufacturer that employs 100 new assembly line workers at $45,000 each for the rest of the year would save almost $300,000 in payroll taxes. If that employee is still on the books in a year, the business owner would receive an additional $1,000 tax credit. Another provision extends 2008 and 2009 [section]179 expensing thresholds so that taxpayers may elect to write off up to $250,000 of certain capital expenditures (subject to a phase-out once expenditures exceed $800,000) in 2010 in lieu of depreciating those costs over time. …

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