Upload
sara-hunter
View
220
Download
1
Tags:
Embed Size (px)
Citation preview
Disability Program Navigator TrainingA Joint Initiative of the
U.S. Department of Laborand the
Social Security Administration
Working with Employers: Disability-Related Tax Credits and Deductions for Employers and EmployeesJames Schmeling, J.D.
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Federal and State Tax Credits and Deductions There are several tax credits and
deductions for employers who hire and accommodate employees with disabilities
There are also tax credits and deductions which employees with disabilities may use
Navigators should know about the credits and share information with employers and employees about the credits
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Small Business Disabled Tax Credit Purpose
Remove barriers and accommodate employees and customers with disabilities
Expenses CoveredAcquire or modify Devices & EquipmentRemove BarriersHire InterpretersTo comply with the ADA and its rules
Amount of the Tax Break50% of $10,250 spent each year, less the first $250. $5,000. annual cap.
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Small Business Disabled Tax Credit Qualifying Businesses
ADA Title I or Title III entity and; 30 or fewer employees OR $1 million or less in gross annual receipts
Legal References26 United States Code Section 44No IRS regulations
Private Ruling 9716009 More information
http://www.usdoj.gov/crt/ada/taxpack.htm
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Architectural and Transportation Barrier Removal Tax Deduction Purpose
Remove barriers, make business facilities and public transportation vehicles accessible
Expenses CoveredRemove Barriers to disabled and elderlyMeet IRS Standards
Amount of the Tax Break$15,000 annual cap
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Architectural and Transportation Barrier Removal Tax Deduction Qualifying Businesses
Any taxpayer owning or leasing a facility or public transportation vehicle in its business.
Legal References26 U.S.C. 19026 Internal Revenue Code Section 1.90
More information http://www.usdoj.gov/crt/ada/taxpack.htm
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Work Opportunity Tax Credit
PurposeHire workers with disabilities and integrate the workforce
Expenses CoveredPart of first year’s wages paid to worker with a disability, referred by VRS; others
Amount of the Tax Break40% of the first $6,000 in wages paid the first year$2,400 cap per EE
Qualifying BusinessesEmployer who hires a person with a disability via a Voc Rehab Services referral
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Work Opportunity Tax Credit
Legal References26 U.S.C. Section 5126 I.R.C. Section 1.51
More information http://www.uses.doleta.gov/wotcdata.asp, http://www.uses.doleta.gov/updates.asp, and http://www.dol.gov/odep/media/press/tax.htm State WOTC Coordinators Contact List http://www.uses.doleta.gov/pdf/sesacoorddirect00.pdfWork Opportunity and Welfare-to-work Tax Credits Reporting System User’s Guide http://www.uses.doleta.gov/pdf/WOTC_WtW_Reporting_System_User_s_Guide.pdf
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Welfare-to-Work Tax Credit
PurposeEncourage employers to hire long-term family assistance recipients who begin to work any time after December 31, 1997, and before January , 2004, to help people move from welfare to work and economic self-sufficiency.
Expenses CoveredWages, including tax-exempt amounts received under accident or health plans as well as educational assistance and dependent assistance programs.
Amount of the Tax Break35% of qualified wages for the first year of employment and 50% for the second year. Qualified wages are capped at $10,000 per year.
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Welfare-to-Work Tax Credit
Qualifying BusinessesEmployers which apply for and receive certification from their State Employment Security Agency (SESA), also known as the State Workforce Agency (SWA), that their new hire is a long-term TANF/AFDC recipient.
Legal ReferencesP.L. 105-34, Taxpayer Relief Act of 1997Re-authorized by P.L. 107-147, Job Creation and Worker Assistance Act of 2002
More information http://www.uses.doleta.gov/wtw.asp
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Example State Tax Creditsand Deductions (MANY more exist) Iowa Assistive Device Tax Credit Iowa Small Business Income Tax
Deduction New York Workers with Disabilities
Employment Tax Credit (WETC) Maryland Disability Employment Tax
Credit
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Iowa Assistive Device Tax Credit Purpose
Hire, retain and accommodate employees with disabilities
Expenses CoveredBuy, Rent or Modify Assistive DevicesMake Workplace Modifications
Amount of the Tax Break50% of the first $5,000 spent per year
$2,500. annual cap$500K fiscal year cap: earliest filed claims paid
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Iowa Assistive Device Tax Credit Qualifying Businesses
Small Businesses with no more than 14 employees OR $3 million or less in annual gross receipts
Legal ReferencesIowa Code Sections 422.11E and 422.33.8AIDED, Iowa Admin. Code 261-66 and IDRF, Iowa Admin. Code 701-42.14
More informationhttp://www.iowasmart.com/services/small_business/tax_credit.htmlhttp://www.state.ia.us/tax/1040%20Expanded/Line/02Line66.html
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Iowa Small Business Income Tax Deduction Purpose
Hire workers with disabilities and integrate the workforce
Expenses CoveredPart of first year’s wages paid to workers with disabilities
Amount of the Tax Break65% of wages paid$20,000 cap per employee
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Iowa Small Business Income Tax Deduction Qualifying Businesses
Small businesses/Farms with 20 or fewer employees, AND $3 million or less in gross revenues
Legal ReferencesIowa Code Section 422.7(12)Iowa Admin. Code 701 IAC 40.21, 53.11, 59.8.
More informationhttp://www.state.ia.us/tax/educate/78578.html
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
New York Workers with Disabilities Employment Tax Credit (WETC) Purpose
Assist individuals with disabilities in securing employment - WETC is an employer friendly benefit for hiring workers with disabilities
Expenses coveredPart of second year’s wages paid to employees with disabilities for employees who meet the eligibility requirements for certification under the Work Opportunity Tax Credit (WOTC) program as a vocational rehabilitation referral; and, who are certified by the New York State Education Department's Office of Vocational and Educational Services for Individuals with Disabilities (VESID), or are certified by the Office of Children and Family Services' Commission for the Blind and the Visually Handicapped (CBVH)
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
New York Workers with Disabilities Employment Tax Credit (WETC) Amount of the tax break
35% of the first $6,000 in wages paid during the second year of employment while the WOTC is in effect, otherwise it is available in the first year of employment
Qualifying businessesSee the PDF linked below – certain corporations and businesses specifically noted
Legal ReferencesChapter 142 of the New York State Laws of 1997
More informationhttp://www.labor.state.ny.us/business_ny/developing_workforce/edsu/wetc.htmhttp://www.tax.state.ny.us/pdf/memos/Corporation/m98_3c.pdf
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Maryland Disability Employment Tax Credit Purpose
Enhance employment opportunities for persons with disabilities as defined by the Americans with Disabilities Act (ADA) for employees with disabilities hired on or after October 1, 1997 but before June 30, 2007
Expenses coveredPortions of the first and second year’s wages, and also for work-related childcare or transportation expenses paid by the employer.
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Maryland Disability Employment Tax Credit Amount of the tax break
For each taxable year a credit is allowed in an amount equal to 30% of up to the first $6000 ($1800) of wages paid during the first year and 20% of up to the first $6000 ($1200) during the second year of employment. A credit of up to $600 of the qualified childcare or transportation expenses incurred during the first year of employment, and up to $500 for the second year.
Qualifying businessesSole proprietorships, corporations, tax-exempt non-profit organizations and pass-through entities, such as partnerships, subchapter S corporations, limited liability companies and business trusts may claim the tax credit.
More informationhttp://www.dllr.state.md.us/employment/mdetc.htmhttp://business.marylandtaxes.com/taxinfo/taxcredit/disability/default.asp
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
Additional Resources
Tax Incentives For Businesshttp://www.dol.gov/odep/pubs/ek97/tax.htm
Assistive Technology Tax Credits – RESNA information page
http://128.104.192.129/taproject/policy/funding/taxcredit.html
SPECIAL THANKS to the Iowa Clinical Law Program for their chart with information on Federal Tax Credits and Iowa Tax Credits
Disability Program Navigator TrainingWashington, D.C. / November 3 – 6, 2003
This training has been designed and developed by the
Law, Health Policy & Disability Center (LHPDC)
of the University of Iowa College of Law
disability.law.uiowa.edu