According to the US Department of Labor, there are presently 3.4 million job openings in the United States. Yet, many employers are finding that workers do not have the skills or training they need to qualify for them for open positions.
Among the unemployed, there are nearly 900,000 unemployed veterans in the United States. A Department of Labor unemployment report states that in October 2011, the average unemployment rate among all veterans was 7.7% and 12.1% for veterans returning from Iraq and Afghanistan. Equally troubling, veterans between the ages of 35 and 64, the group with the highest financial obligations and the fewest available VA education and training options, continue to make up nearly two-thirds of all unemployed veterans. Overall, nearly one in twelve of our nation's heroes can't find a job to support their family, don't have an income that provides stability, and don't have work that provides them with the confidence and pride that is so critical to their transition home.
The "VOW to Hire Heroes Act" is bipartisan, bicameral, comprehensive legislation that would lower the rate of unemployment among our nation's veterans and provides tax credits for employers hiring those veterans into a comprehensive jobs package that will aggressively attack the high rate of veteran unemployment by:
1) Expanding Education & Training: To begin moving veterans out of the unemployment lines, the VOW to Hire Heroes Act of 2011 provides nearly 100,000 unemployed veterans of past eras and wars with up to 1-year of additional Montgomery GI Bill benefits to qualify for jobs in high-demand sectors, from trucking to technology. It also provides disabled veterans who have exhausted their unemployment benefits up to 1-year of additional VA Vocational Rehabilitation and Employment benefits.
2) Improving the Transition Assistance Program (TAP): The VOW to Hire Heroes Act makes TAP mandatory for most service members transitioning to civilian status, upgrades career counseling options, and job hunting skills, as well as ensures the program is tailored to individuals and the 21st Century job market.
3) Facilitating Seamless Transition: Getting a civil service job can often take months which often forces a veteran to seek unemployment benefits. To shorten the time to start a federal job after discharge, this bill allows service members to begin the federal employment process by acquiring veterans preference status prior to separation. This facilitates a more seamless transition to civil service jobs at VA, or the many other federal agencies that would benefit from hiring our veterans.
4) Translating Military Skills and Training: This bill also requires the Department of Labor to take a hard look at how to translate military skills and training to civilian sector jobs, and will work to make it easier to get the licenses and certification our veterans need to locate gainful private employment.
5) Veterans Tax Credits: In a time when so many small to medium size employers are struggling due to tax and regulatory burdens, the VOW to Hire Heroes Act provides tax credits for hiring veterans and disabled veterans who are out of work. These include:
-40 percent of the employee's first year's wages, up to $6,000 (i.e., a tax credit of up to $2,400) for each veteran hired who receives Supplemental Nutrition Assistance Program benefits;
-40 percent of first-year wages, up to $6,000 (i.e., a tax credit of up to $2,400) for each veteran hired who was unemployed for a period of at least four weeks but less than six months during the year ending on the hire date;
-40 percent of first-year wages, up to $12,000 (i.e., a tax credit of up to $4,800) for each veteran hired who has a service- connected disability and is hired not more than one year after being discharged or released from active duty;
-40 percent of first-year wages, up to $14,000 (i.e., a tax credit of up to $5,600) for each veteran who was unemployed for a period of at least six months during the year ending on the hire date; and
-40 percent of first-year wages, up to $24,000 (i.e., a tax credit of up to $9,600) for each veteran hired who has a service-connected disability and was unemployed for a period of at least six months during the year ending on the hire date.
The credits are available for veterans hired between November 22, 2011, and December 31, 2012. The veteran must be a new hire and not be a relative of the employer. In addition, he or she must be employed for at least 400 hours for the employer to earn the full credit. If the veteran works at least 120 hours but less than 400 hours, the percentage of wages qualifying for the credit is reduced to 25 percent.
Apart from the maximum credit per employee, there is no limit on the number of tax credits or the total amount of tax credits an employer may take. However, they are not refundable and are limited to the current year's income tax liability. Unused credits may be carried back one year or forward 20 years to offset the income tax liability in those years.
To claim the credit, you must obtain certification that a newly hired veteran was receiving unemployment benefits for the requisite period or otherwise meets one of the eligibility criteria.
Assistance on this process and the benefits it may have for your business can be discussed further by calling one of the attorneys at BHMK.
Brian R. Redden