IRS Issues Forms and FAQs on HIRE Act

April 10, 2010

Back on March 19, we alerted our clients and friends about the new Hiring Incentives to Restore Employment (“HIRE”) Act, which grants employers a payroll tax exemption for wages and salary paid to previously unemployed individuals. See our previous alert here New Tax Incentives for Employers Who Hire in 2010. On April 7, 2010, the IRS issued a new Form W-11 as well as FAQs which provide some welcome guidance on the HIRE Act. The Form W-11 serves as the employee affidavit which allows the newly hired employee to certify that he/she was “unemployed” for the 60 days prior to hire. The FAQs answer some common questions about the HIRE Act, including whether an employee rehired after layoff from the same employer can qualify for the payroll tax exemption. The answer to that question is yes, provided the individual was unemployed during the 60-day period. The FAQs also make it clear that recent graduates can qualify as well, as long as they were unemployed during the 60-day period prior to hire.
If you have questions regarding the above, please contact Mary Ellen Schill, the author of this article, or any of the attorneys in the Employment, Benefits & Labor Relations Practice Group of Ruder Ware.

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