Corporate Tax Change which Could Impact Your 2011 Business Tax Return

By Eric M. Key, CPA

During 2011 Congress made many changes to the corporate tax laws.  The New Hire Retention Credit is one which might affect your small business and should be considered when you prepare your corporate tax returns for 2011. 

Here’s how it works: if you hired employees between February 3, 2010 and before January 1, 2011, they may have qualified you for a payroll tax holiday from Social Security Tax last year.  If you consequently retained them for the following 52 consecutive weeks into 2011, then you may also qualify for a general business tax credit of up to $1,000 per employee on your 2011 federal tax return. This credit is calculated on form 5884-B.