Has anyone looked at the new act and how this will impact firms that prepare quarterly payroll forms for clients? Any suggestions on how the preparer can accumulate this information without having the clients personnel records in our office. How will we document if the hired person replaced an employee or is a newly created job and is eligible for the credit? This act is for persons hired after Feb 3, 2010 and before Jan 1, 2011. I see a problems reconciling quarterly reports to w-2 at year end and how many letters will this generate by the IRS for us to prove the credit is valid. Just my thoughts and wonder if anyelse has read this. The National Society of Accountants sent me the new alert yesterday.
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I can also see
lots of potential problems, but not much we can do about them except wait for the IRS to put out some affadavits for us to get signed. Meanwhile we're taking the employer's word that it's all true and of course he's taking the word of someone desperate for a job that he/she hasn't worked lately. It seems all a mix of basic hearsay -- how can an employer prove/disprove whether a prospective new hire did or did not work somewhere else/40 hours in the last 60 days? And how's an employer going to answer if you say they get a $1,000 credit and no SS tax for the right answer to this question (which can't realistically be verified): "Did this employee take the place of an existing position. If so, did the departed employee leave voluntarily? Or are you saying this is a brand new position with no complications?"Originally posted by spt View Post
This recent post is all I really know about it, but I agree it's going to be a can of worms.
Originally posted by Jesse 03-18-2010
...Employers who hire unemployed workers this year (after Feb. 3, 2010 and before Jan. 1, 2011) may qualify for a 6.2-percent payroll tax incentive, in effect exempting them from their share of Social Security taxes on wages paid to...each worker retained for at least a year, businesses may claim an additional general business tax credit, up to $1,000 per worker...New hires filling existing positions also qualify but only if the workers they are replacing left voluntarily or for cause...the new law requires that the employer get a statement from each eligible new hire certifying that he or she was unemployed during the 60 days before beginning work or, alternatively, worked fewer than a total of 40 hours for someone else during the 60-day period. The IRS is currently developing a form employees can use to make the required statement...Eligible employers will be able to claim the new tax incentive...for the second quarter of 2010...further details of these tax provisions will be posted on IRS.gov during the next few weeks.
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