Is Your Business Taking Advantage of this Illinois Tax Credit?

If your business qualifies you can take advantage of this tax credit retroactive to July 2012.  The credit is set to expire June 30, 2016 and will not apply to any new job positions created after June 30, 2016.  This is a $2,500 Illinois withholding tax credit per new job position.  This credit was created to reverse the high unemployment in Illinois and to help spur the economy.

Business Qualification
Your business must be located in Illinois and fit into one of two categories to be eligible to receive this credit:
1) Small businesses with 50 or less full-time employees on July 1, 2012. The employee count includes all employees – even those outside of the state of Illinois, but does not include part-time workers.
2) Any-sized business that hires a 2010 “Put Illinois to Work Program” worker-trainee.  

Additionally, the newly created position must pay no less than $10.00 per hour or the equivalent salary for a minimum of $18,200 annualized.

As a part of the program, your business must maintain a consistent/positive headcount to receive the tax credits.  When calculating your tax credit you need to base it on the net increase in full-time Illinois employees.  Example:  If your business has 20 full-time employees, and you create 5 new positions that you register for the tax credit; however, during the year you eliminate 7 unrelated positions, you would not be eligible to receive any tax credits.

Additionally, the calculation of the net increase in the number of full-time Illinois employees is based on your number of employees as of June 30, 2012.  If your business had 5 full-time employees as of June 30, 2012, you create and register 2 new positions for tax credit consideration, then when each job is ready to be attested to (one year from the hire date); you must have at least 7 full-time employees currently employed with the business in order to maintain a positive headcount.  Note that new businesses hiring their first Illinois employees may qualify for the credit.

Tax Credit and Registration
As the employer you are entitled to one tax credit ($2,500) per new position if the position is filled for one year.  This does
not need to be the same person that you hired when you created the position.  The position just needs to be filled for the entire year.  The $2,500 is applied against your Illinois withholding tax. 

As soon as a new full-time Illinois employee is hired and begins providing services, you can register them online at JobsTaxCredit.illinois.gov.  However, there is a difference in the timing to apply for the tax credit between the small business and the “Put Illinois to Work” worker-trainees.  For Small business: one year after filling the new position, you will provide supporting data online in order to be issued your tax credit certificate(s); whereas with “Put Illinois to Work” worker-trainees:  6 months after the filing, you are eligible for half the tax credit ($1,250) and the balance at the conclusion of 12 months.
    
This program is first-come first-served; and you must register your company information and newly created job(s) no later than June 30, 2016.  Again – this credit is retroactive to July 1, 2012 so you may have created positions that are already eligible for an immediate credit.

Call me to see if we can help attain this credit for your business.

Gene Barinholtz  -  847-278-4347
gbarinholtz@krdcpas.com

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