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Hiring Incentives to Restore Employment (HIRE Act)

A new job creation act entitled Hiring Incentives to Restore Employment (HIRE Act) has become law. The hire Act will reduce the cost for a family that hires a Nanny (a qualified worker (Nanny) is defined as anyone who has worked 40 hours or less in the 60 days preceding employment). Those families who hire a qualified worker(s) will be entitled to an exemption on the employer portion of the social security tax. The 6.2% exemption applies to all wages paid in 2010 until December 31, 2010. Employers will still be required to pay medicare (1.45%) as well as unemployment and any other applicable state taxes, but the hire act will reduce the employer's payroll tax obligation by more than 60%. Families will then be required to report the new hire and deduct the employer social security tax from their estimated federal payments throughout the rest of the year. If you have any questions please contact Breedlove and Associates or visit www.breedlove-online.com to see how this law may affect you.