You may know that Congress recently provided a tax credit for businesses that hire veterans. You may not know that nonprofits are also eligible for the credit. Here’s how it works:
Your organization can claim the lesser of the work opportunity tax credit (25% of first-year wages for those employed between120 and 400 hours and 40% for those employed 400 hours or more) or the amount of the payroll taxes paid by your organization during the calendar year.
The credit is available to your qualifying nonprofit organization for “qualified veterans” hired between November 22, 2011 and December 31, 2012. If you think your organization may already be eligible for the credit, it should file its Form 941 for the fourth quarter 2011 normally (due today) and the IRS will provide subsequent guidance on how to claim the credit. If you are unsure whether an employee will be considered a qualified veteran or for help filing the Form 941, contact the organization’s tax professional for assistance.