Armed Forces Day thanks to our military via celebrations, military-related tax breaks and tax-rewarded jobs

AFDPoster2017_DoDThe first Armed Forces Day was celebrated on this day 67 years ago.

President Harry S. Truman led the effort to establish a single holiday to thank U.S. military members for their service in support of our country.

On Aug. 31, 1949, Truman’s Secretary of Defense Louis Johnson announced the creation of Armed Forces Day to replace the separate Army, Navy, Marine Corps and Air Force Days. It was a logical move given the unification under Truman’s administration of the Armed Forces under the Department of Defense.

President John F. Kennedy established Armed Forces Day as an official holiday in 1962. It now is observed each year on the third Saturday of May.

If there’s a parade or other Armed Forces Day festivities today in your area to honor our men and women in uniform, go, pay your respects and enjoy the event.

Business tax break for hiring vets: If you’re an employer, consider showing your appreciation for those who have completed their tours of duty.

There’s even a possible tax bonus. Hiring a veteran, including those disabled during their course of service, could provide your business a tax break.

The Work Opportunity Tax Credit, or WOTC, is a long-standing income tax benefit that encourages employers to hire certain types of workers who face significant barriers to employment.

There are now 10 categories of WOTC-eligible workers. They are:

  • Unemployed veterans, including disabled veterans
  • Qualified IV-A Temporary Assistance for Needy Families (TANF) recipients
  • Ex-felons
  • Designated community residents living in Empowerment Zones or Rural Renewal Counties
  • Vocational rehabilitation referrals
  • Summer youth employees living in Empowerment Zones
  • Supplemental Nutrition Assistance Program, also known as SNAP or food stamp, recipients
  • Supplemental Security Income (SSI) recipients
  • Long-term family assistance recipients
  • Qualified long-term unemployment recipients

These 10 categories of WOTC-eligible hires are this week’s By the Numbers figure.

Tax credit steps: The credit amount is generally based on wages paid to eligible workers during the first two years of employment.

To qualify for the credit, an employer must first request certification by filing Internal Revenue Service Form 8850 with the state workforce agency within 28 days after the eligible worker begins work. Other requirements and further details can be found in 8850’s instructions.

Eligible businesses then claim the WOTC on their income tax return. The credit is first figured on Form 5884 and then becomes a part of the general business credit claimed on Form 3800.

Though the credit is not available to tax-exempt organizations for most categories of new hires, a special rule allows them to get the WOTC for hiring qualified veterans. These organizations claim the credit on Form 5884-C.

The WOTC page at IRS.gov has more information.

Military tax considerations: There also are several special tax provisions for the men and women being recognized today.

They include a later filing deadline in some situations, special consideration in claiming the Earned Income Tax Credit and some state tax breaks, too.

Rather than rewrite these military tax matters, you can find more in my previous blog posts listed below:

A bit of tax help is the least Uncle Sam can do for those who volunteer to put themselves in harm’s way to protect the United States. He and I thank you, today and every day.

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Source: http://feedproxy.google.com/~r/DontMessWithTaxes/~3/H_zc6d-HtZE/armed-forces-day-military-tax-breaks.html

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