There are many reasons to hire a diverse workforce: you can ensure a wide range of experience and skill sets makes it into your business. People also look more favorably upon businesses that hire individuals with disabilities. There are also financial incentives for your business.
Tax Incentives
Hiring individuals with disabilities can qualify your business for a variety of tax benefits. There are three main tax incentives:
- Work Opportunity Tax Credit
- A tax credit is available to employers who hire persons with disabilities.
- The tax credit amounts to 25 percent of qualified first-year wages for those working 120 to 400 hours or 40 percent for 400 hours or more worked.
- Disabled Access Tax Credit
- Provides a non-refundable credit for small businesses that incur expenditures for the purpose of providing access to persons with disabilities.
- An eligible small business is one that earned $1 million or less or had no more than 30 full time employees in the previous year; they may take the credit each and every year they incur access expenditures.
- Barrier Removal Tax Deduction
This tax deduction helps businesses of all sizes remove physical or transportation barriers that make it hard for people with disabilities or the elderly to access their services.- You can deduct up to $15,000 per year for eligible expenses that would normally have to be treated as capital costs.
- You can combine this deduction with the Disabled Access Credit in the same year, as long as your expenses meet both programs’ requirements.
Additional information on eligibility and how to apply for these credits can be found on the IRS and Virginia Works websites.
Additional Financial Incentives
- Federal Bonding Program
$5,000 bond that is free to employers and covers eligible employees for six months.