2015 inflation adjustments for exemptions, deductions, more!
Tax extenders outlook cloudy in the 2014 lame duck session

A question for Congress on Veterans Day: Will the business tax break for hiring returning military members be renewed?

Getting a job sometimes is the hardest job of all. And military veterans face particular challenges as they transition from the Armed Forces to civilian life.

Military fatigues and business suit image courtesy Monster Veterans Talent Index November  2014
Image courtesy Monster's November 2014 Veterans Talent Index

A recent survey by Monster Worldwide, parent company of employment website Monster.com and armed forces focused Military.com, found that the biggest obstacle veterans face is communicating how their military skills translate to non-base positions.

It is often difficult, said two-thirds of the poll respondents, for them to explain to prospective employers how their military skills can be used by civilian companies. 

Veterans unemployment falling: But things are looking better for former Navy, Army, Air Force and other service personnel who are now home and seeking jobs.

The Monster survey found that despite the military-to-civilian translation issues, most former troops are increasingly confident in their ability to land jobs.

That confidence is backed up by the numbers. Post 9-11 veterans, defined as those who served from September 2001 to the present, are increasing in the workforce, notes the Monster survey, and have reported decreased unemployment rates.

In September 2014, there were 21.1 million veterans, including nearly 3.3 million post 9-11 veterans. Unemployment rates have improved for all veterans, with a 4.7 percent overall rate and 6.2 percent rate for the post 9-11 vets.

Tax break for veteran hires pending: For the last several years, Uncle Sam encouraged employers to help cut those veterans' job-seeking numbers even more by offering a tax break for businesses that hired former military personnel.

Under the Work Opportunity Tax Credit (WOTC), companies got tax benefits for hiring certain workers. Among the qualifying workers, thanks to the VOW to Hire Heroes Act of 2011, were some veterans.

The WOTC was extended as part of the American Taxpayer Relief Act of 2012, popularly known as the fiscal cliff tax bill, through Dec. 31, 2013.

That tax break, however, now is (along with 50 or so others) in limbo.

UPDATE: Congress renewed the WOTC as part of the Protecting Americans from Tax Hikes, or PATH, Act signed into law in December 2015. While the credit is still temporary, it is now in effect through 2019.

I like to think that most companies wouldn't need a tax break to hire members of our armed forces who have come back home and are coping with new responsibilities.

But all things being even, that tax savings could make a difference, both to the business and the former soldier or sailor looking for a job.

Included in Senate extenders: The WOTC is part of the Senate Finance Committee approved EXPIRE Act. Here's what that the committee's summary of that comprehensive extenders package (with my highlighted emphasis added) says about the provision:

Work Opportunity Tax Credit (as modified)
This bill extends for two years, through 2015, the provision that allows businesses to claim a work opportunity tax credit equal to 40 percent of the first $6,000 of wages paid to new hires of one of eight targeted groups. These groups include members of families receiving benefits under the Temporary Assistance to Needy Families (TANF) program, qualified veterans (including those who are unemployed, disabled, or receiving TANF), qualified ex-felons, designated community residents, vocational rehabilitation referrals, qualified summer youth employees, qualified food and nutrition recipients, qualified SSI recipients, and long-term family assistance recipients.

The bill also adds the long-term unemployed to the list of eligible populations. An employer hiring persons who have exhausted their 26 weeks of regular unemployment benefits would be eligible for a 40 percent credit on the first 6,000 of wages paid to each hire that first year, or a maximum credit of $2,400 per employee.

A two-year extension of this provision is estimated to cost $3.16 billion over 10 years.

I know the House and Senate swear to us taxpayers and the worried Internal Revenue Service that they'll take care of extenders soon.

On this day originally designated to acknowledge the end World War I and then expanded to honor all military veterans, it's fitting to consider what we can do to thank these men and women for what they did while in uniform.

It's nice to say "thank you" to a service man or woman when you run across them in airports or other public places.

And special recognition at sporting events is a great ego boost.

But our veterans need the walk and not just the talk.

Helping returned military members get civilian jobs via a tax break nudge is a small, but real and important way we thank these men and women.

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