How to Compute the Credit
Hiring Incentive Tax Credit
A credit may be applied against the Connecticut corporation business tax by business firms that hire recipients of Temporary FamilyAssistance (TFA).
Calculate the credit on Form CT-1120 HIC, Hiring Incentive Tax Credit, by multiplying the number of complete calendar months worked by a qualifying employee during the income year by $125. The credit amount reported on Form CT-1120 HIC must be entered on Form CT-1120K, Business Tax Credit Summary.
Definitions A qualifying employee is any employee who:
Is employed not less than 30 hours per week; and
At the time of employment, has been receiving benefits from the TFAprogram for more than nine months and meets other requirements that the Commissioner of the Connecticut Department of Labor (CTDOL) may establish in regulations adopted in accordance with Chapter 54.
Business firm means any business entity authorized to do business in Connecticut and subject to the corporation business tax.
In order to qualify for this program, a business firm must:
Submit an application to the Commissioner of CTDOL on or after July 1 but not later than December 31;
Receive reservation approval to hire an eligible TFArecipient by December 31; and
Employ a qualifyingTFArecipient for a minimum of 30 hours per week for a full calendar month.
A business firm may claim a tax credit on its tax return for the income year during which a qualifying employee was employed, in the amount of $125 for each full month that the employee was employed. The maximum credit allowed to all business firms in any one fiscal year is $1 million.
No credit will be allowed, with respect to wages paid to any qualifying employee, to any business firm that has previously been granted a tax credit with respect to wages paid to the same employee.
Any unused credit balance can be carried forward and applied to five successive income years. No carryback is allowed.
How to Apply
Forms necessary to apply for the Hiring Incentive Tax Credit are available by contacting CTDOL Program Support Unit at 860-263-6030. Forms must be submitted to CTDOL between July 1 and December 31 of each year. Applications will be approved or denied in the order in which they are received.
Connecticut tax forms are available anytime from the DRS website at www.ct.gov/DRS or by calling 1-800-382-9463 (Connecticut calls outside the Greater Hartford calling area only) and selecting Option 2 from a touch-tone phone, or 860-297-4753 (from anywhere).
Where to Get Additional Information
Direct inquiries to:
Connecticut Department of Labor Program Support Tax Credit Unit 200 Folly Brook Blvd. Wethersfield CT 06109-1114
REFERENCES: Conn. Gen. Stat. §12-217y
Informational Publication 2006(15), Guide to Connecticut Business Tax Credits Issued: 04/24/07