Incentives Watch: Employers Get a Boost with Enactment of Numerous Tax Credits for Hiring Veterans


Delaware recently enacted a new tax credit for hiring recent combat veterans. The credit, known as the Veterans' Opportunity Credit, is available to any business that hires a qualified veteran on or after Jan. 1, 2012, but prior to Jan. 1, 2016. The employer is entitled to a credit against personal income, corporate income, bank franchise, or insurance premium taxes equal to 10 percent of the veteran's gross wages, up to a $1,500 maximum, a recent Bloomberg BNA Weekly State Tax Reportarticle reported.

Likewise, Virginia also established an additional tax credit for employers hiring veterans, according to another Bloomberg BNA Weekly State Tax Reportarticle. Specifically, taxpayers that hire veterans of the conflicts in Iraq and Afghanistan may claim a credit equal to 20 percent of the gross wages paid by the taxpayer to a qualified veteran in the course of that veteran’s sustained employment during a taxable year. The credit is capped at $5,000 per veteran hired.

Earlier this year, Alabama, New Mexico, Utah, and Wisconsin enacted tax credits for hiring unemployed veterans as well. These states, along with California, Illinois, Vermont, and West Virginia, offer veteran tax credits for employers, according to the Bloomberg BNA State Tax Portfolios.



In other developments . . .

The New Jersey Tax Court recently ruled that New Jersey residents who received pass-through S corporation income from a New York source, but were forced to allocate the income entirely to New Jersey under the Corporation Business Tax Act, were entitled to a gross income tax credit because they paid New York personal income taxes on the income, according to an article in the Bloomberg BNA Weekly State Tax Report.

 

By: Kathleen Caggiano

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