New HIRE Act Stimulus to Businesses

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As the end of 2010 approaches and we receive numerous inquiries concerning developing hiring plans, I thought you might be especially interested to note some particulars about the Hiring Incentives to Restore Employment Act (the “HIRE Act”) which was enacted earlier this year to stimulate prompt hiring of workers by businesses.

Among the most notable provisions of the HIRE Act are the following:

Payroll Tax Holiday – Employers receive an exemption from paying their portion of the OASDI Social Security payroll tax (6.2% of wages up to $106,800) for every worker hired between February 4, 2010 and December 31, 2010 if that worker has been unemployed for at least 60 days. This payroll tax holiday applies to wages earned after the March 18,2010 enactment of the HIRE Act, but does not apply to the Medicare portion of the Social Security payroll taxes and does not apply to the earnings of self-employed workers. Employers are required to obtain written affidavits from workers (on a form designed by the IRS) attesting to the fact that the worker has been unemployed for the requisite 60 days.

Please see full alert for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Foley Hoag LLP | Attorney Advertising

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