NASE Blogs


Sep 08, 2010
Q. Can you explain the tax benefits of the HIRE Act?


A. The Hiring Incentives to Restore Employment (HIRE) Act that passed this year created two new tax benefits to encourage employers to hire and retain new workers.


Employers who hire unemployed workers after Feb. 3, 2010, and before Jan. 1, 2011, may qualify for a 6.2-percent payroll tax incentive. The incentive effectively exempts employers from their share of the Social Security tax on wages paid to these workers after March 18, 2010.


In addition, for each unemployed worker retained for at least a year, business owners may claim a new hire retention credit of up to $1,000 per worker when they file their 2011 income tax returns.


The IRS has a new form, Form W-11, Hiring Incentives to Restore Employment (HIRE) Act Employee Affidavit, which will help employers claim the special payroll tax exemption.


The new law requires that employers get a statement from each eligible new hire, certifying under penalties of perjury, that she was unemployed during the 60 days before beginning work or, alternatively, worked fewer than a total of 40 hours for anyone during the 60-day period. Employers can use Form W-11 to meet this requirement. It’s available at


If you’ve hired an employee this year, make sure you look into this new credit.