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Employer Tax Credit for Hiring Veterans Extended Through 2013

Veterans between jobs or transitioning out of the military got a modest win in the last-minute negotiations over avoiding the so-called “fiscal cliff” over the New Years Day holiday: Congress extended the Returning Heroes and Wounded Warriors Work Opportunity Tax Credits for another year.

Originally scheduled to expire at midnight on December 31st, the tax credits will provide an incentive to companies to preferentially hire veterans through 2013. Specifically employers can qualify for a tax break of between $2,400 and $9,600 for every veteran they hire.

That can go a long way toward offsetting recruiting and bonus costs, for example – or just add a bit of ballast to the company’s bottom line, to make it more competitive and ensure those jobs you create can be sustained.

The Taxpayer Relief Act of 2012 – the law that gave Americans a temporary reprieve from the so-called “fiscal cliff,” also extended a tax credit that provided employers a $4,800 incentive to hire recently discharged veterans with service-connected disabilities and $5,600 for hiring a chronically unemployed veteran.

Additionally, the law also provides a $9,600 incentive if the veteran is both service-disabled and who has been unemployed for an extended period of time.

If you are an employer and you believe you may qualify for the credit, submit a completed Form 8850, Pre-screening Notice and Certification Request for the Work Opportunity Credit. Instructions are here. (Note: You don’t file it with the IRS, but with your State Workforce Agency, or SWA. See the instructions.)

If you are a recently-hired veteran and you think your employer may qualify for the break, let your boss know. If they somehow missed the tax credit, an extra few thousand in the bank may encourage a small business owner to reach out and hire the next veteran that comes along.

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