Federal Hiring Incentives to Restore Employment Act

The American Camp Association (ACA) would like to direct your attention to a new tax law, the Federal Hiring Incentives to Restore Employment (HIRE) Act (Pub. Law 111-147), which could be a benefit to camps this year when hiring staff. Allen McBride, treasurer of The Association of Independent Camps (AIC), has written an article about the HIRE Act. ACA would like to add a few details that we have learned from the American Payroll Association, the IRS, and our legal representative.In addition to sharing the information in the article from AIC, ACA wants to be sure camps understand that qualifying individuals must meet these requirements:

  • The employee has not been employed for more than 40 hours during the 60-day period prior to the day the individual begins work for the qualified employer.
  • The employee is not employed by the qualified employer to replace another employee unless the other employee left employment voluntarily or was terminated for cause.
  • The employee is not related to the qualified employer or to anyone owning 50 percent or more of the stock or other capital of the employer.

Since the writing of Allen McBride’s article, the IRS has created Form W-11, which must be signed by the qualifying employee and maintained in his or her personnel record. To find Form W-11, go to http://www.irs.gov/pub/irs-pdf/fw11.pdf. The IRS is also revising Form 941, Employer’s Quarterly Tax Return, for 2nd quarter 2010 filing purposes. This form is being revised to include the calculations according to the new law. All employers must use this form whether they are taking advantage of the HIRE Act’s social security tax relief or not. The form is currently in draft form and should be available on the IRS website in May 2010. To find the draft form, go to: http://www.irs.gov/pub/irs-dft/f941--dft.pdf.ACA’s legal representative has also recommended that you consult your tax advisor for more information regarding this new law.For more information on the HIRE Act, please visit the IRS Web site at www.irs.gov, and for frequently asked questions, please go to http://www.irs.gov/businesses/small/article/0,,id=220746,00.html.

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