TRENTON – A bill that would provide tax credits to employers who hire unemployed individuals was released by the Senate Labor Committee Monday morning.
The vote was 3-0, with the Republicans, Sen. Dawn Addiego (R-8) of Evesham and Sen. Anthony Bucco (R-25) of Boonton, abstaining.
The bill (S2211), formally known as the “New Jobs for New Jersey Act,” provides a tax credit as an incentive to small private-sector employers to hire unemployed workers. It applies to businesses that have no more than 100 employees.
The credit would be applied against the corporation business tax or the gross income tax, whichever applies to the employer, for each eligible individual hired by the employer.
Among other things the employer would be eligible for a tax credit if:
* the eligible individual is hired by the employer after April 1, 2013;
* is employed full-time during the tax year for which the tax credit is provided;
* was not previously employed by the employer, and;
* did not have full-time employment for 30 or more days prior to being hired by the employer;
The bill sets the amount of the refundable tax credit provided to an approved employer for each eligible individual employed during a tax year as the total amount of the employer payroll taxes paid during that tax year by the employer with respect to that individual, subject to the requirements of the bill.
Employer payroll taxes include the portion paid by employers of state unemployment, temporary disability, and workforce development and basic skills assessments, and federal Social Security, Medicare, and unemployment taxes.
The bill provides that the employer receives the tax credit only for the number of eligible individuals employed full-time during the tax year which does not exceed the net increase in the number of full-time employees employed full-time during the tax year compared with the average total number of full-time employees employed by the employer during the 12-month period immediately preceding October 1, 2012.
An employer may apply for and qualify for a tax credit under the bill with respect to tax years 2013, 2014, and 2015. If the employer’s application is approved for any of those three years, the employer may continue to receive the tax credit for any of the four tax years following that tax year during which the employer meets the requirements of the bill.