For Small Business Week, IRS Spotlights Expanded Tax Credit for Hiring Veterans, Credit for Providing Health Care Coverage to Employees and Tax Relief

Issue Number:    IR-2012-56

WASHINGTON — The Internal Revenue Service is marking Small Business Week, May 20 to 26, by encouraging small business owners to check out two key tax credits and a special relief program that could provide significant tax benefits during 2012.

Both the expanded credit for hiring veterans and the credit for employer-provided health care coverage can provide tax savings to eligible small businesses when they file their 2012 federal income tax returns. In addition, substantial relief from past payroll tax obligations is available to eligible employers who agree to reclassify their workers as employees in the future.

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House Approves Mobile Workforce Tax Relief Bill

The House passed bipartisan legislation Tuesday to bring tax relief to workers employed in more than one state.


The bill, passed by voice vote, was co-sponsored by Congressmen Howard Coble, R-N.C., and Hank Johnson, D-Ga., and was supported by many groups, including the National Taxpayers Union and the National Association of Manufacturers.


H.R. 1864, the “Mobile Workforce State Income Tax Simplification Act of 2011,” establishes a 30-day threshold for tax liability and employer withholding. The bill would establish a uniform national standard governing the withholding of state income taxes for nonresident employees.


AICPA president and CEO Barry Melancon applauded the bill’s passage in at least one chamber of Congress. “The House’s passage today of H.R. 1864, the Mobile Workforce State Income Tax Simplification Act of 2011, is a critical step toward balancing and streamlining onerous recordkeeping and reporting requirements for workers who are required to file nonresident personal income tax returns because they work temporarily outside their home state,” he said in a statement. “The bill would establish a uniform requirement that non-residents would have to work in a state for more than 30 days before becoming subject to out-of-state income taxes. The uniform standard would improve compliance and still guarantee that state governments could collect the taxes owed to them.

“The AICPA strongly supports H.R. 1864, and we thank the many state CPA societies from across the country who wrote to their members of Congress in support of the bill,” Melancon added. “We also thank Representative Howard Coble, a Republican from North Carolina, and Representative Hank Johnson, a Democrat from Georgia, for their leadership in successfully steering this legislation through the House. We urge the Senate to pass the bill.”

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