Helping your employees gain up to $6,000 in Earned Income Tax Credits (both federal and state) improves morale and reduces turnover!
80% of all people who are eligible for federal earned income tax credits are NOT claiming them. The percentage is even lower for state earned income tax credits.
Employers that have a way to successfully educate and enroll their employees in these programs increase morale and decrease turnover substantially. Here’s why:
Employers with work forces that are on the low end of the pay scale know that many of their employees making $15/hr or less often live paycheck to paycheck and struggle with dropping out of the workforce altogether. The earned income tax credit (EITC) adds several thousands of dollars to an employee’s take-home pay and increase it by 20% or even more, depending on the state. And the EITC is available to both part and full time employees! Companies in industries like hospitality, restaurant and fast food, nursing homes, hospitals manufacturing, casinos, call centers, landscape or agricultural and more could benefit from government tax credits and voluntary benefits programs.
Helping Your Employees Helps You!
Turnover rates in low paying job positions can often be 50% to 150%. This turnover expense results in high costs due to lower quality of work, productivity gaps and the time lost in retraining.
State and federal money helps people who want to work for you. Use it!
The Earned Income Tax Credit (EITC) gives thousands of dollars to low paid employees. Yet, only about 20% of those eligible for federal EITC take advantage of it! In certain states the percentage of eligible employees taking advantage of state EITC is far less than 20%. Though one of the most generous tax credits available to anyone earning less than $54K per year, it is also one of the most overlooked according to many tax professionals.
Implementation is the key to success…
Awareness and education are only the first steps to effective implementation. Most low-income employees need someone to walk them through the paperwork. When companies bring bilingual teams in to coach and help employees enroll, it’s a win-win for everyone. Employees can receive up to $3,000 in tax refunds and their appreciation can result in loyalty and reduced turnover for organizations that care. It may require a thoughtfully planned intervention but the result is well worth it for those companies that are proactive in their approach.
Work Opportunity Tax Credits Available For Companies Employing Targeted Demographics
The Work Opportunity Tax Credit (WOTC) is for the employer. The WOTC provides a specialized tax credit to companies in these lower paid industries. WOTC helps targeted workers move from economic dependency into self-sufficiency as they earn a steady income and become contributing taxpayers, while participating employers are able to reduce their income tax liability.
The maximum tax credit ranges from $1,200 to $9,600, depending on the employee hired. So what should a company expect? Using an average as an example, if 50 employees qualify, that is equivalent to a potential $120,000 credit.
There are additional Training Credits and Welfare-to-Work Tax Credits that can drive this number substantially higher. But many companies are unaware, or simply do not take advantage of these available subsidies.
Get help to make sure you don’t miss the specialty tax credits that could mean real dollars to your bottom line!
Many companies are either unaware or simply do not have the time or expertise to take advantage of the numerous specialty tax incentives and cost savings available to them. A specialty firm like ours that uncovers the unknown or underutilized credits can mean real dollars to you and in some cases, to your employees.
ATTENTION CPAs: Make sure your clients who have at least 50 low paid employees know about this. You show yourself to be more knowledgeable than the average CPA when you do! Contact us so we can help you better help your clients and greatly benefit them directly and indirectly!
To receive a no-cost assessment of how you can realize significant savings and credits, visit rareintro.com