Is your company taking advantage of Federal, State and Local Tax

Incentives?

Why do tax credits exist?

Encourage businesses to Locate or relocate Maintain or expand operations Maintain or increase workforce Train current or new employees

Revitalize economically distressed areas

Move people from public assistance into employment

Value to clients

Hard dollar savings

Creates funding for other services

Viewed as contributing member of the community

Does your company qualify?

•Yes, credit opportunities if–Not-for-profit hiring veterans–Not-for-profit for 2010 HIRE Act–For profit companies

•Yes, fantastic credit opportunities!

–Profitable companies experiencing strong hiring growth

–Profitable companies with high turnover, hourly workforce

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Federal, state and local programs

Federal

State Credits

Geographic Programs

25%

30%

45%

Work Opportunity Tax Credit (WOTC)Up to $9,600 per eligible hire

State CreditsUp to $20,000 per eligible hire

Geographic / Enterprise ZonesUp to $37,440 per eligible hire

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Work Opportunity Tax Credit (WOTC)

• Managed by Dept. of Labor and IRS

• Encourages businesses to hire from targeted groups:– Veterans – Receiving government

assistance

• Credits based on hours worked and wages earned (25% or 40%)

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WOTC Case Study

• 7,500 employee long-term care organization

• Screened during application

• $500,000 in eligible new hiring credits in 8 months

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How it works

Screening manually

• Job seeker manually completed form

Missing forms

• Hiring manager submits 8850 for every hire

Extra paper and mailing

• Forms follow up

Difficult to submit all

forms

• Certifi-cation

Rejected eligible

candidates

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Other screening methods get better results

• Phone screen

• Online screening questionnaire

• Best practice – within a recruiting solution

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Best practice: online screening

Under 2% opt-out

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View results before interviewing

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Benefits of electronic screening

Less work!• 98% less paperwork• Pre-populated forms

More credits!• Screen for all available credits• Eligibility known immediately• Higher screening and forms

compliance

Capturing WOTC just got a lot easier

• FINALLY – electronic signature approved!

• State agencies jumping onboard

• Ask name and date• File electronically or

mail signed form• More dollars with less

effort!

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California Enterprise Zone (EZ)

• State incentive for nearly 30 years

• Encourages business to locate, invest and create jobs

• Currently 42 designated Ezs today

• Several benefits for businesses

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CA – EZ worth up to $37,440 per employee

• Hiring Credits, Equipment Credits, & other benefits

• Hiring Credit screening is similar to WOTC

• No industry or company requirements

• Timeframe to certification is about 3 months

• Credit taken on tax return (retro as well)16

CA-EZ case study

• 2,500 employee food manufacturer

• In 3 California EZs

• $1M in retroactive credits

• Additional credits available!

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HIRE Act: it’s not too late!

• Payroll (cash) incentive

• Waived 6.2% Social Security taxes in 2010

• Many missed opportunity

• It’s not too late to capture it!

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HIRE Act case study

• 2,500 employee hospitality company

• Manually screened retroactively for HIRE Act

• Minimal work involved

• $250,000 in cash back!

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Another lucrative CA incentive program

• California Employee Training Program (ETP)

• Reimburses for training expenses

• Training of full-time, permanent employees

• Must provide training plan to be submitted and approved before training is done

California ETP Case Study

• Regional headquarters

• Implementing SAP

• 300+ employees trained

• IA wrote and submitted application, managing compliance

• Awarded contract: $400,000

Are you leaving other funds on the table?

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Screening Credits

Training Grants

Negotiated In

centives

Cost Segregatio

n

GreenR&D

Online resources

• CA-EZwww.calchamber.com/ez

• WOTC http://www.doleta.gov/business/incentives/opptax/

• HIRE Act http://www.irs.gov/businesses/small/article/0,,id=220745,00.html 23

Learn which programs are available

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http://incentivesadvisors.com/Request.aspx?src=scalch

Online resources

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Summary

• Government programs that encourage hiring

• Federal, state and local programs

• Technology makes it easier

• Consultants can reduce work involved

• Online resources available

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