The federal program that offers employers a credit against their tax liability for hiring the disadvantaged has been extended for one year, according to Labor Secretary Ann McLaughlin.
The Targeted Jobs Tax Credit program was to expire Dec. 31, but it has been extended to Dec. 31, 1989. The program allows employers to claim the credit if they hire people from nine target groups.President Reagan signed the Technical and Miscellaneous Revenue Act of 1988 and it extended the deadline with the change that the value of credit employers can claim for economically disadvantaged summer youth employees will be limited to 40 percent, instead of 85 percent, of wages up to $3,000.
Another change is that economically disadvantaged youth who are hired must be between ages 18 and 22, instead of 18 and 24.
For other people, employers may claim a credit of 40 percent of first-year wages up to $6,000 per employee. The maximum credit per employee the first year of employment is $2,400, McLaughlin said.
The nine target groups in the program are:
- Economically disadvantaged summer youth who are 16-17 years old on the hiring date and who have previously not worked for the employer.
- Youth aged 18-22 from economically disadvantaged families.
- Youths aged 16-19 from economically disadvantaged families who participate in a qualified cooperative education program.
- People with disabilities who have been referred to an employer from a state vocational rehabilitation or Veteran's Administration program.
- Economically disadvantaged Vietnam-era veterans.
- Economically disadvantaged ex-offenders who are hired no later than five years after release from prison or date of conviction, whichever is more recent.
- Recipients of Aid to Families with Dependent Children who are eligible for AFDC on the hiring date and have received it for 90 days immediately prior to being hired.
- Federal Supplemental Security Income recipients.
- Recipients of state and local general assistance payments for at least 30 days.