On December 17, President Obama signed into law the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010. In addition to extending the Bush-era tax cuts for 2 more years, this bill retroactively extended a number of expired provisions of interest to clients, including the Federal Empowerment Zone Tax Credit, the Washington DC Zone Credit, the Research and Development Tax Credit and the Indian Employment Tax Credit - all through December 31, 2011.
The Work Opportunity Tax Credit (WOTC), which was set to expire on August 31, 2011, was also extended through December 31, 2011 to synchronize it with the life of other reauthorized “extenders.” The new law did not extend two expired provisions of interest, the Federal Renewal Communities and the Katrina WOTC Category. In addition, two WOTC categories established under the American Recovery and Reinvestment Act of 2009, Disconnected Youths and Disabled Veterans, were not reauthorized beyond their sunset date of December 31, 2010. Lastly, the HIRE Act Social Security Tax exemption for Employers hiring the unemployed was not renewed beyond its December 31, 2010 end date.
Employment Tax Credit and WOTC clients will have tax credit screening and processing to reflect these legislative changes. In addition, we will closely monitor political and regulatory activity in Washington DC as the new Congressional agenda starts to develop.
Should you have any questions, please feel free to contact your Client Relationship Manager or Steve Thomas, Kris Thorngren, Roy Goldman or Frank Berardi for more information.