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By Woods & Durham, Feb 15 2018 07:00AM

Over the past several months we have provided you with several ways to qualify for the Work Opportunity Credit (WOTC). With the close of this series we will be providing you with some of the lesser known ways to qualify for this credit which include hiring: TANF (Temporary Assistance for Needy Families) Recipients, Vocational Rehabilitation Referrals, Ex-Felons, SSI (Supplemental Security Income) Recipients, and Qualified Long Term Unemployment Recipients.

TANF/Welfare Recipients –

Requirements:

1. Employee is a new hire, not a rehire

2. Employee has received TANF payments for any of the previous 18 consecutive months

3. Not a relative of the business owner

Vocational Rehabilitation Referrals –

Requirements:

1. Employee is a new hire, not a rehire

2. Not a relative of the business owner

3. Employee has a physical or mental disability resulting in a substantial handicap to employment and who was referred to the employer upon completion of rehabilitation services provided by an agency with state approval

Ex-Felons –

Requirements:

1. Employee is a new hire, not a rehire

2. Not a relative of the business owner

3. An employee who has been convicted of a felony under state or federal law and is hired within one year after conviction or release from prison

Supplemental Security Income Recipients –

Requirements:

1. Employee is a new hire, not a rehire

2. Not a relative of the business owner

3. An employee that is receiving supplemental security benefits in the 6 months prior to being hired

Long-term Unemployment Recipients –

Requirements:

1. Employee is a new hire, not a rehire

2. Not a relative of the business owner

3. An employee has been unemployed more than 27 consecutive weeks before being hired

If you need information for another state or have any questions about the WOTC please contact us.

More info can be found at, https://www.doleta.gov/business/incentives/opptax/

By Woods & Durham, Jan 24 2018 07:00AM

Has your company hired an individual that has been a recipient of SNAP benefits/food stamps? If so, your company may be eligible for the Work Opportunity Tax Credit (WOTC). The maximum credit is $2,400 per qualified employee.


Requirements:

1. Employee is a new hire, not a rehire


2. Employee is 18 to 39 years old


3. Employee is a member of a family that received SNAP benefits for the 6 month period immediately before hiring


4. Not a relative of the business owner


Reminders


Proper documentation must be submitted for approval no later than 28 days after hiring a qualifying employee.


Other classes of employees that may qualify for the WOTC are Veterans, TANF (Temporary Assistance for Needy Families) Recipients, SNAP (Food Stamp) Recipients, Designated Community Residents (employees 18-39 years old living in a designated rural renewal county), Vocational Rehabilitation Referrals, Ex-Felons, and SSI (Supplemental Security Income) Recipients.


If you need empowerment zone information for another state or have any questions about the WOTC please contact us.


More info can be found at, https://www.doleta.gov/business/incentives/opptax/



By Woods & Durham, Jan 2 2018 07:00AM

More and more individuals who thought their child- rearing days were over are now raising their grandchildren. Grandparents in that challenging situation and those who think they might be in that situation someday should be aware that a variety of tax breaks may be available to ease the financial burden of becoming primary caregivers for grandchildren. These include head of household filing status, exemption for the child, earned income credit, child tax credit, credit for child and dependent care expenses, credits or deductions for qualified education expense, deductions for medical and dental expenses, and the adoption credit. See descriptions below of each tax break.


Head of Household filing status: An individual who is considered unmarried and has a qualifying child may be eligible to use head of household status as his or her filing status. This status is generally more favorable than a single filing status. An unmarried taxpayer may qualify as head of household by maintaining as his or her home a household that is the principle abode, for more than half the year, of a qualifying child or an individual that the dependency deduction can be claimed on.


Exemption for the child: A grandparent who has a child living with him or her may be able to claim the child as a dependent. A person generally qualifies as the taxpayer’s dependent if the person is the taxpayer’s qualifying child or qualifying relative. The exemption is $4,050.


Earned income credit: A grandparent that is working and has a qualifying child living with them may be able to take the earned income tax credit. Maximum credit is $6,269.


Child tax credit: A grandparent who is raising a child under the age of 17 may be able to take the child tax credit. Maximum credit is $1,000 per child.


Credit for child and dependent care expenses: This credit may be available to a grandparent that pays someone to care for a qualifying individual, who has the same principal place of abode as the grandparent for more than half the year, where the amounts are paid for period in which the grandparent works or looks for work. Maximum credit is 35% of employment related care expenses.


Education expenses: There are a number of tax breaks to grandparents who pay his or her grandchild’s education costs. These tax breaks include the American Opportunity tax credit, Lifetime Learning credit, Coverdell Education Savings Accounts, Qualified Tuition Programs/529 Plans, higher education exclusion for savings bond income, and a deduction for student loan interest.


Medical and dental expenses: An individual who itemizes can deduct the amount by which certain unreimbursed medical and dental expenses paid during the year for himself or herself, his or her spouse, and his or her dependents exceed 10% of his adjusted gross income.


Adoption expenses: If a grandparent legally adopts his or her grandchild, he or she is eligible for a credit of up to $13,570. In addition to adoption fees, qualified expenses include court costs, attorney fees, and travel expenses. State often also offer a separate adoption expense credit.


Employer Benefits: Grandparents who are still employed when they take on primary caretaker responsibilities for a grandchild should consult their company’s human resources representative to see if they are eligible for grandchild-related benefits under various employer plans, such as reimbursement arrangements, health flexible spending arrangements, employer provided health plans, and dependent care assistance programs.


For more details on these tax breaks and how they may benefit you in your particular situation please contact Woods & Durham.



By Woods & Durham, Dec 8 2017 06:00PM

Tax-exempt nonprofit organizations can also take advantage of the Work Opportunity Tax Credit (WOTC). A nonprofit can qualify for the tax credit, by being hiring a “qualified” veteran. The credit can be used against the nonprofit’s Federal payroll tax liability. The maximum credit is $6,240 per eligible employee.

Requirements:

1. The employee previously served in the military

2. The employee is considered a Qualified Veteran. To be considered “qualified” the employee must meet one of the following:

• The employee is unemployed for a period of at least 4 weeks before being hired

OR

• The employee is unemployed for a period of at least 6 month before being hired

OR

• The employee is entitled to compensation for a service connected disability and is hired not more than a year after leaving the military

OR

• The employee is entitled to compensation for a service connected disability, has been unemployed for at least 6 months and is hired no more than a year after leaving the military

OR

• A member of the employees family has received SNAP benefits/food stamps for at least 3 months during the previous 15 months before being hired

3. The employee is a new hire, not a rehire

Reminders

Proper documentation must be submitted for approval no later than 28 days after hiring a qualifying employee.

Other classes of employees that may qualify for the WOTC are Veterans, TANF (Temporary Assistance for Needy Families) Recipients, SNAP (Food Stamp) Recipients, Designated Community Residents (employees 18-39 years old living in a designated rural renewal county), Vocational Rehabilitation Referrals, Ex-Felons, and SSI (Supplemental Security Income) Recipients.

More info can be found at, https://www.doleta.gov/business/incentives/opptax/

By Woods & Durham, Nov 16 2017 08:00AM

As the holiday season approaches you're likely considering giving cash gifts to family or friends. Before you calculate the amount of your gifts, you may want to consider the annual gift tax exclusion of $14,000 to avoid paying gift tax..


This means that both spouses or each individual may give a gift of up to $14,000 to any one individual without having to pay any gift tax.


For example, Dad could give son and son's wife each $14,000 and Mom could also give son and son's wife $14,000 each for a total annual tax - free transfer of cash from Mom and Dad to son and son's wife of $56,000.



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