Tax Breaks for Hiring New Employees

If you’re thinking about hiring new employees this year, you won’t want to miss out on these tax breaks.

1. Work Opportunity Credit

The Work Opportunity Tax Credit (WOTC) is a federal tax credit for employers that hire employees from the following targeted groups of individuals:

  • A member of a family that is a Qualified Food Stamp Recipient
  • A member of a family that is a Qualified Aid to Families with Dependent Children (AFDC) Recipient
  • Qualified Veterans
  • Qualified Ex-Felons, Pardoned, Paroled or ork Release Individuals
  • Vocational Rehabilitation Referrals
  • Qualified Summer Youths
  • Qualified Supplemental Security Income (SSI) Recipients
  • Qualified Individuals living within an Empowerment Zone or Rural Renewal Community
  • Long Term Family Assistance Recipient (TANF) (formerly known as Welfare to Work)

The tax credit (a maximum of $9,600) is taken as a general business credit on Form 3800 and is applied against tax liability on business income. It is limited to the amount of the business income tax liability or social security tax owed. Normal carry-back and carry-forward rules apply.
For qualified tax-exempt organizations, the credit is limited to the amount of employer social security tax owed on wages paid to all employees for the period the credit is claimed.
Also, an employer must obtain certification that an individual is a member of the targeted group before the employer may claim the credit.

Note: The Protecting Americans from Tax Hikes Act of 2015 (the PATH Act) retroactively allows eligible employers to claim the Work Opportunity Tax Credit (WOTC) for all targeted group employee categories that were in effect prior to the enactment of the PATH Act, if the individual began or begins work for the employer after December 31, 2014 and before January 1, 2020.
For tax-exempt employers, the PATH Act retroactively allows them to claim the WOTC for qualified veterans who begin work for the employer after December 31, 2014, and before January 1, 2020.

2. Disabled Access Credit and the Barrier Removal Tax Deduction

Employers that hire disabled workers might also be able to take advantage of two additional tax credits in addition to the WOTC.
The Disabled Access Credit is a non-refundable credit for small businesses that incur expenditures for the purpose of providing access to persons with disabilities. An eligible small business is one that earned $1 million or less or had no more than 30 full-time employees in the previous year; they may take the credit each and every year they incur access expenditures. Eligible expenditures include amounts paid or incurred to:
1. Remove barriers that prevent a business from being accessible to or usable by individuals with disabilities;
2. Provide qualified interpreters or other methods of making audio materials available to hearing-impaired individuals;
3. Provide qualified readers, taped texts, and other methods of making visual materials available to individuals with visual impairments; or
4. Acquire or modify equipment or devices for individuals with disabilities.
The Architectural Barrier Removal Tax Deduction encourages businesses of any size to remove architectural and transportation barriers to the mobility of persons with disabilities and the elderly. Businesses may claim a deduction of up to $15,000 a year for qualified expenses for items that normally must be capitalized. Businesses claim the deduction by listing it as a separate expense on their income tax return.
Businesses may use the Disabled Tax Credit and the architectural/transportation tax deduction together in the same tax year if the expenses meet the requirements of both sections. To use both, the deduction is equal to the difference between the total expenditures and the amount of the credit claimed.

3. Indian Employment Credit

The Indian Employment Credit provides businesses with an incentive to hire certain individuals (enrolled members of an Indian tribe or the spouse of an enrolled member) who live on or near an Indian reservation. The business does not have to be in an empowerment zone or enterprise community to qualify for the credit, which offsets the business’s federal tax liability.
The credit is 20 percent of the excess of the current qualified wages and qualified employee health insurance costs (not to exceed $20,000) over the sum of the corresponding amounts that were paid or incurred during the calendar year of 1993 (not a typo).

Wondering if your business qualifies for tax breaks?
Help is just a phone call away!!

Familiar With Ransomware?

Picture

Ransomware is now considered a fact of life in today’s cybersecurity landscape, but that doesn’t mean small and medium businesses (SMBs) are protecting themselves from a potential ransomware attack or even consider it a possibility.

Often, users recognize a ransomware threat after it’s too late. According to the Verizon 2015 Data Breach Investigations Report, 23 percent of SMBs that receive phishing emails open them, and 11 percent click on the attachment. 

And those types of mistakes can be costly. According to the FBI’s Internet Crime Complaint Center, ransomware victims reported more than $18 million in losses between April 2014 and June 2015, with ransoms ranging from $200 to $10,000.

SMBs need to start protecting themselves from the growing threat of ransomware. Educating your employees about the threat of ransomware and sharing these important tips is an important first step.

1. Put technical safeguards in place
As a best practice, have an intrusion-prevention system and security software running on your computers. This should include antivirus software, malware scanners, firewalls, and spam filters. Then, make sure all security patches are up to date, and deploy new patches on a regularly scheduled basis.

It’s also critical to have a backup solution in place and frequently test the backups running on your systems to make sure they’re working properly. If you’re hit with ransomware, you’ll want to restore operations as quickly as possible, and having a recent backup to recover from will save you both time and money.

2. Train employees
Even with technical safeguards in place, it’s employees who ultimately risk exposing a business to ransomware. User error, such as clicking on an infected online advertisement, pop-up window, or attachment in a spam email, is often to blame for inviting ransomware into a computer. So, users are the most important line of defense.

Talk with your employees about ransomware, educating them on what it is and how they can help defend the business. Try getting the whole staff together for a training session and bring lunch to make it a Lunch and Learn event.

As a best practice, you should require all new employees to complete the training and offer it on an ongoing basis to avoid information being missed. If you don’t have the resources to put this type of training together, talk to your Cybersecurity services provider who could run a program like this for you or provide educational materials.

3. Provide examples to end users
The most effective way to educate your employees on ransomware is to show them examples of what it looks like  (https://www.pcrisk.com/common-types-of-computer-infections#ransomware) so they’ll know the warning signs and be able to identify a suspicious message or attachment before they click on anything. For example, you can share the Dell Security phishing quiz (http://www.sonicwall.com/phishing/phishing-quiz-question.aspx), which includes examples of infected and legitimate emails and provides explanation of how to tell the difference.

Once ransomware has infected a computer, a message is displayed on the screen letting the user know their machine has been compromised. Check out some examples of these types of message by clicking here. It’s helpful to share this type of information with employees as well so that, even if it’s too late, they’ll know to alert management and ask for help.


Picture

Contributor:
Mr. Tomas Santos-Alejandro is President of Advent Services, a locally-owned Cybersecurity and Managed Security Services company. He can be reached at solutions@adventsvcsllc.com or (850) 441-2915. For more information about Advent’s services visit www.adventsvcsllc.com.