MJA & Associates

FREQUENTLY ASKED QUESTIONS

We try to anticipate questions you might have about our services and provide the answers here. If you need additional information, please send an email to info@mja-associates.com.

1. HOW DO YOU QUALIFY FOR TAX CREDITS?

Your company may qualify for tax credits for JOB CREATION. If you hire individuals from certain target groups, you may be eligible for up to $9,600 for each qualified new hire. If you are opening new locations, experiencing turnover, or growing your business, these are tax incentives that may significantly help your business.

2. WHAT IS THE COST TO PARTICIPATE IN THESE TAX PROGRAMS?

Our fees are contingency-based. There are no startup costs, and we only earn a percentage of the savings generated by our services. Your company will see an immediate return on your investment because fees are only paid when your company earns the tax credits.

3. WHEN CAN YOUR COMPANY USE THE TAX CREDITS?

The tax credits can be carried forward for up to 20 years anchor carried back to a year. Depending on the structure of your organization, tax credits may also pass through to the owner's personal income tax.

4. HOW CAN THESE TAX PROGRAMS INCREASE YOUR PROFITS?

Our clients are saving millions of dollars annually. We see annual tax savings between $50,000 to $1,00,000 per year. The tax credits earned are a dollar-for-dollar match against your federal income tax.

5. WHEN IS THE BEST TIME TO START THESE TAX PROGRAMS?

Many States are understaffed, which is causing a delay in Certificates being issued. Some States are taking longer than one year to approve an application and issue a Certificate. Keep this in mind when forecasting your budget and tax planning. It may take more than a year to start seeing results from the tax programs. The sooner you start the program, the sooner your company will start increasing profits.

6. WHAT IS THE WORK OPPORTUNITY TAX CREDIT (WOTC)?

The WOTC has two purposes.

  • To promote the hiring of individuals who qualify as a member of a target group.
  • To provide a federal tax credit to employers who hire these individuals.

7. WHAT ARE THE TARGET GROUPS THAT QUALIFY FOR THE WOTC?

Individuals hired from the following ten target groups may qualify an employer for the WOTC:

  • A. Qualified recipients of Temporary Assistance to Needy Families (TANF).
  • B. Qualified Veterans receiving food stamps; unemployment benefits, or qualified veterans with a service-connected disability who:
    • Has a hiring date which is not more than one year after having been discharged or released from active duty. OR
    • Have aggregate periods of unemployment during the one-year period ending on the hiring date that equal or exceeds six months.
  • C. Ex-felons hired no later than one year after conviction or release from prison.
  • D. Designated Community Resident - an individual between the ages of 18 to 40 on the hiring date who resides in an Empowerment Zone or Rural Renewal County.
  • E. Vocational rehabilitation referrals, including Ticket Holders with an individual work plan developed and implemented by an Employment Network.
  • F. Qualified summary youth ages 16 through 17 who reside in an Empowerment Zone.
  • G. Qualified food stamp recipients ages 18 through 40 on the hiring date.
  • H. Qualified recipients of Supplemental Security Income (SSI).
  • I. Long-term family assistance recipients.
  • J. Long-Term Unemployed

8. WHAT IS THE AMOUNT OF CREDIT AVAILABLE THROUGH WOTC?

The amount of the tax credit varies by the target group. The tax credit for target groups A, B, C, D, E, F, G, H, and J is 40 percent of qualified first-year wages up to $6,000 if the individual is retained for at least 400 hours, but at least 120 hours, a 25 percent tax credit is available on qualified first-year wages up to 6,000.

The tax credit for target group I, Long-term recipients of AFDC, is 40 percent of qualified first-year wages up to 10,000 and 50 percent of second-year qualified wages up to 10,000. The individual must be retained for at least 180 days or 400 hours.