Hiring Incentives & UCM

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Hiring Incentives & UCM

Paradigm Partners offers services to assist with Hiring & Location Incentives and Unemployment Claims Management. Click below to learn more:

HIREtech: A Paradigm Hiring Solution 

The HIREtech Application was developed to help our clients maximize the tax benefits derived from state and federal hiring and location tax incentives.

HIREtech was created with four objectives in mind:

  1. To provide real time information to our clients about their new hires with respect to hiring and location incentives such as WOTC, HUD Zone, HIRE Act, and the Indian Tax Credit.
  2. To maximize these benefits to our clients.
  3. To provide a backbone for our production staff so that each member knows exactly what needs to be accomplished every day to maximize the benefits to our clients.
  4. Maintain confidential information in a highly secure environment.

By meeting these objectives, our clients will benefit by:

  • Maximized Tax Incentives
    • In order to have real time information, HIREtech has the ability to upload the most current payroll information. Since most tax incentives have both hours worked and salary thresholds, integrating HIREtech with the payroll system was imperative. There may be some situations where an employee is only a few hours away from qualifying and having this information available will help make a good business decision on those employees that are approaching the finish line.
    • HIREtech will also catch if a new hire has not been screened. This is critical because some incentives have filing deadlines. For example, WOTC has a 28 day window to file for the credit and if you miss that window, you’ve lost the WOTC credit.
    • The biggest issue facing employers is the reluctance of many new hires to discuss directly with their employer or manager the assistance programs in which they are involved that can qualify them for a tax incentive. It’s embarrassing to them. In order to alleviate this issue, Paradigm offers a phone screening service and the ability for new hires to answer these sensitive questions online. New hires are much more likely to provide this important and necessary information because both options are seen as a third party not as their employer.
  • Incentives information at their fingertips – The Dashboard Reporting System provides a client with the latest information on each new hire, the credit status for that employee; either pending or certified and the amount of the credit.

Paradigm Partners offers consulting services for the following Hiring and Location Incentives:

The Work Opportunity Tax Credit (WOTC)

What is the Work Opportunity Tax Credit?

The Work Opportunity Tax Credit (WOTC) is a federal tax credit that reduces the federal tax liability of any for-profit employers. Employers can hire from many different targeted groups including:

  • Qualified Temporary Assistance to needy Families Recipients (TANF)
  • Qualified Veterans/Disabled Veterans
  • Qualified Ex-felons
  • Qualified Designated Community Residents (DCR) residing in an Empowerment Zone (EZ), Renewal Community (RC), or in a Rural Renewal County (RRC)
  • Qualified Vocational Rehabilitation Agency Referrals
  • Qualified Summer Youth (SY)
  • Qualified Food Stamp Recipients (FS)
  • Qualified Supplemental Security Income Recipients (SSI)
  • Qualified Long-Term Family Assistance Recipients (LTFAR)

Maximum Credit Available

  • $1,200 for each new Summer Youth* hired
  • $2,400 for each new Adult hired
  • $4,800 for each new Disabled Veteran hired
  • $9,000 for each new Long Term Family Assistance Recipient hired over a two year period

*The credit is based on 40% of up to $6,000 in qualified wages during the first year of employment. Summer Youth qualify for 40% of the first $3,000 in wages during the required working period of May 1 through September 15.

Minimum Employment or Retention Period

All new employees must work a minimum of 120 hours and individuals hired as Summer Youth employees must work at least 90 days, between May 1 and September 15, before an employer is eligible to claim the tax credit. Recent program changes took place in 2007 that impacted multiple target groups. One such change was the consolidation of the Welfare-To-Work Tax credit program into the WOTC program to become known as Long-Term Family Assistance and a second change was the creation of the new Disabled Veteran target group that went into effect May 25, 2007. On February 17th as part of the American Recovery and Reinvestment Act (ARRA) of 2009 two new categories were created Unemployed Veterans and Disconnected Youth.

The WOTC Program has been reauthorized until December 31, 2013.

Long-Term Family Assistance Recipients who began work after December 31, 2006 and before September 1, 2011, can earn employers up to $9,000 if they are a member of a family:

  • That received TANF for at least 18 consecutive months before the hire date
  • Whose TANF eligibility under federal or state law expired after August 5, 1997 (for applicants hired within two years after their eligibility expired)
  • That received TANF for at least 18 months, beginning after August 5, 1997, and is hired not more than two years after that 18-month period

Disabled Veterans who began work after May 25, 2007 and before September 1, 2011, can earn employers up to $4,800 if they:

  • Are entitled to compensation for a service-connected disability of at least 10%
  • Have a hiring date which is not more than 1 year after having been discharged or released from active duty in the Armed Forces of the United States
  • Have aggregate periods of unemployment during the 1 year period ending on the hiring date which equal or exceed 6 months

For more information, use our Contact Us Form or call Karim Solanji at 281-558-7100.

Federal HUD Zone Tax Incentives, Empowerment Zones and Renewal Communities

Are there any employer incentives for hiring employees who work in an Enterprise Zone (EZ) or Renewal Community (RC)?

Note: Renewal Community Credits are available only for look backs to 2008 and 2009.

Yes. The tax code allows employers a credit against Federal taxes for hiring and retaining employees who live and work in an EZ or RC. The EZ Wage Credit has been available since 1994 for Round I EZs and since 1998 for the District of Columbia.

Can a business use this credit for current employees?

Yes. The EZ Wage Credit and RC Wage Credit are incentives to hire and retain individuals who live in an EZ or RC, so it is available each year throughout the EZ Wage Credit and RC Wage Credit periods.

What if the employee works part-time?

The credit is available for both part-time and full-time employees as long as they have been employed by the employer for at least 90 days. The amount of the credit is tied to the amount of wages paid rather than to the number of hours worked.

What is the credit amount?

The EZ Wage Credit amount is up to $3,000, and for the RC Wage Credit is $1,500.

Is there a limit on the number of employees for which a business can take the credit?

An employer can take the credit for as many employees as qualify.

What if the employee works in an EZ or RC for only part of the year?

An employer can use either the pay-period or calendar-year method for determining the period of time the employee performs services in an EZ or RC. No other time periods can be used to prorate the credit.

For example, if an employee works in several factory locations and is paid weekly, an employer can claim the wage credit for the weekly pay periods during which the employee works substantially all of his or her time in the factory located in an EZ or RC.

What if the Federal tax liability of the business is less than the total credit amount?

The EZ Wage Credit and RC Wage Credit generally are subject to the same rules as other business tax credits. As with other business tax credits, unused credit amounts can be carried forward for up to 20 years and carried back a year. However, the credit cannot be carried back prior to the EZ or RC designation.

Can a pass-through entity, such as a partnership, Limited Liability or S-corporation, use the credit?

The EZ Wage Credit and RC Wage Credit are general business tax credits for Federal tax purposes and may be passed through under the rules similar to other business tax credits.

Which categories of employees would not qualify for the EZ and RC Wage Credits?

The EZ and RC Wage Credits cannot be taken for any individual employed at any private or commercial golf course, country club, massage parlor, hot tub facility, suntan facility, racetrack or other gambling facility, or store whose principal business is the sale of alcoholic beverages for consumption off premises. The EZ and RC Wage Credits are not available for family members of the employer, including sons, daughters, parents, stepchildren, stepmothers, stepfathers, in-laws, and other persons treated as dependents under the tax code. Similar exclusions apply to 5 percent owners related to the employer and family members of majority shareholders or partners of the employer.

For more information, use our Contact Us Form or call Karim Solanji at 281-558-7100.

Indian Tax Credit

Qualifying Employees

Employees that are certified members of an approved Native American tribe or the spouse of a certified member are qualifying employees.  The employee must live on or “near” the reservation and perform the majority of the work on the reservation and has worked for a minimum of one year.

Qualifying Companies

The company must be non-Indian or non-Tribal owned business and located on the reservation.

Tax Credit Available

The maximum annual credit available is $4,000 per eligible employee.

 

For more information, use our Contact Us Form or call Karim Solanji at 281-558-7100.

Unemployment Claims Management (UCM)

Paradigm Partners will help your company minimize your unemployment tax rates. Once our program is implemented, our process includes an Initial Review, Administration of Claims, Audit of Benefit Charges, Management of Unemployment Taxes, Unemployment Claims Management and finally, Reporting. Below is a short description of each of the steps of our process.

Program Implementation

The first order of business is contacting all relevant state agencies to change the address of record for communications. We will contact each of your locations to discuss how best to work together to ensure a smooth transition.

Initial Review

We will review your current process and make the necessary adjustments to eliminate errors and file for relevant credits and refunds.

Claims Administration

Proven claims administration is the cornerstone to successful tax rate reduction. Our experienced staff will work hand-in-hand with your staff to make sure that all claims are complete and submitted on time. Where necessary, appeals will be filed.

Our seasoned attorneys will assist you in the preparation for any appeals hearing but also represent you in the hearing itself.  This approach guarantees the best outcome for your company in the appeals process.

Benefit Charge Audits

Audits are performed by our specialists on your unemployment account to identify unwarranted charges. Once access is granted to your unemployment account, your personnel are free to continue their daily activities.

Unemployment Tax Management

Unemployment tax management has become increasingly important because of rising unemployment tax rates. Our staff will review annual tax rate notices and analyze records of your taxable wages and benefit charges against state agency data. Protests will be filed on your behalf when errors and discrepancies arise.

If your corporate structure changes, an analysis will be performed to determine the optimal approach to minimize your unemployment taxes.

Reporting

Our reports will provide you with detailed claims activity information.

Unemployment Claims Management (UCM)

Over the last few years, unemployment has reached historically high levels that may have increased your workload while maintaining or even reducing your human resources staff. Paradigm’s Unemployment Claims Management service can relieve the burden on your staff while reducing your unemployment claims costs.

The key to reducing these costs is to do things right with the initial claim. Our experienced staff will do away with the need for appeals and related assessed charges.

For more information, use our Contact Us Form or to speak with a Tax Credit Specialist please call 866.927.5993

Testimonials

When we came over to Paradigm from our previous provider we had no idea about the amount of potential that existed through these programs. We now not only spend less time on these programs than before, but the benefits are much greater thanks to Paradigm’s system and account manager help!
Tammie Gaudette
HR Director
Dunkin Donuts
Testimonials
After changing to Paradigm Partners and seeing how they monitored compliance with their account manager system and added an additional level of screening, I started wondering what exactly our last provider did for us. The credits have increased and the work on our end has decreased.
Steve Lam
VP of Finance
Applebee's
Testimonials
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