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Hiring Credit Incentive Description
Calculating the Credit

Voucher Application Fee - NEW
Eligibility Determination
Qualified Employees
Appropriate Documentation
Work Incentive Act (WIA)
Work Opportunity Tax Credit (WOTC)
Targeted Employment Area (TEA)
Income Eligibility
Vouchering Procedures
Employee Questionnaire
Hiring Credit Update
 

Calculating the Credit
The Hiring Tax Credit is based on the lesser of the actual hourly wage paid or 150% of the minimum hourly wage established by the Industrial Welfare Commission.  Currently, the minimum wage is $7.50.  The hiring credit ceiling is 150% of the minimum wage or $11.25 per hour.  Effective January 1, 2008, the minimum wage will increase to $8.00, raising the hiring credit ceiling to $12.00 per hour.  In determining the allowed wages and the percentage breaks for a part-time employee, use the full-time equivalent or 2,080 hours per year.  Wages that qualify for the hiring credit are those wages paid to a qualified employee for the consecutive 60-month period beginning on the first date the employee commenced employment with the employer.  There is no time of employment requirement to take advantage of this tax credit.  Once employed, all wages paid to a qualified employee are eligible.

Eligibility Determination
Under the Enterprise Zone law, four groups of individuals are eligible for a voucher (otherwise referred to as EZ eligible:

  • Those who are receiving or are eligible to receive services under the Job Training Partnership Act (JTPA) or its successor, the Workforce Investment Act (WIA);
  • Those who are a participant in Welfare-to-Work activities under CalWORKs;
  • Those who are members of a targeted group under TJTC or its successor, the federal Work Opportunity Tax Credit Program (WOTC); and
  • Those employees residing in a designated Targeted Employment Area (TEA).

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Voucher Application Fee
After November 1, 2004, all applications for enterprise zone vouchering review, must include a $10 fee for each application submitted.  This fee is required by the state per SB 1097 signed into law on August 16, 2004.  Applications received without the fee included will be returned for resubmission.  There is no local fee.  The submission form can be downloaded - pdf version or word.


Qualified Employees
Qualified employees include those who meet one of the following eligibility criteria relating to the job candidate's employment/wage earning status for a defined period prior to the date of hire:

  • Enrolled or eligible for the Job Partnership Training Act (JTPA) or its successor, the Workforce Investment Act (WIA), or who are participating in Welfare-to-Work activities under CalWORKs; members of a targeted group under TJTC or its successor, Work Opportunity Tax Credit (WOTC)
  • Displaced worker
  • Economically disadvantaged individual 14 years of age or older
  • Member of a federally-recognized Indian tribe or Native American
  • Ex-offender
  • Long-term unemployed
  • Victim of a massive layoff or plant closure
  • Unemployed due to a military base closure
  • Previously self-employed
  • Seasonal or migrant worker
  • Involuntarily separated active duty or National Guard as of 9/30/90
  • Individuals with physical or mental disability which limits ability to work
  • Low wage earners (based on state poverty guidelines)
  • Resident of a designated Targeted Employment Area (TEA)
  • Receiving some form of monetary public assistance (food stamps, general assistance, refugee cash assistance, vocational rehabilitation referral, SSI/SSP (Social Security benefits), state disability insurance benefits)

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Appropriate Documentation
The Hiring Credit Voucher Preapplication provides a listing of acceptable documents for determining eligibility. A file copy of any one document listed per criteria is acceptable to the Department of Labor's standard of documentation. The Department of Labor's standard will also apply to zone's documentation of eligibility requirements. If appropriate documentation is not available, alternative methods of documentation may exist such as verification by telephone or an applicant's statement. 


Work Incentive Act (WIA)
A WIA or participant in Welfare-to-Work activities under CalWORKs hired by a Yuba-Sutter Enterprise Zone business is automatically eligible for the EZ Hiring Tax Credit Program.  The One Stop Center can help you identify qualified individuals.


Work Opportunity Tax Credit (WOTC)
The Ticket to Work and Work Incentives Improvement Act of 1999 (Public Law 106-170) extends the Work Opportunity Tax Credit (WOTC) to December 31, 2007. The WOTC, which includes the Welfare-to-Work Tax Credit, has two purposes:  to promote the hiring of individuals who qualify as a member of a targeted group and to provide a federal tax credit to employers who hire these individuals. Information on this tax credit program is available from the One Stop Centers or the WOTC Center at (916) 774-4374 or go to the WOTC website on the Internet at www.edd.cahwnet.gov/wotcind.htm. An individual eligible for the WOTC is also EZ eligible.


Targeted Employment Area (TEA)
An individual residing in a designated Targeted Employment Area or TEA and hired by a Zone business is automatically eligible for the EZ Hiring Credit program. Verification of residency is all that is required. The Yuba-Sutter Enterprise Zone includes two (2) TEAs, one identified as Census Tract 502 in Yuba City and Census Tract 404 in Yuba County.

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Income Eligibility
With the exception of residents of a Targeted Employment Area, the family income of the employee must be verified as being within the eligibility guidelines. Income eligibility should be based on the 70 Percent Lower Living Standard Income Levels (LLIL), Table 4, from the Department of Labor, with the exception of family of 1, which income level can be based on the poverty income level for a family of 1 if that rate is the higher of the two. Rates for 2000 are shown on the Income Eligibility Table.


Vouchering Procedures
Once an individual has been determined eligible for the hiring credit and has been hired by an EZ business, an Enterprise Zone Hiring Credit Voucher will be issued. The voucher should be retained for income tax purposes. A copy of every voucher is on file with the Zone office in the event a voucher is misplaced or lost.

Hiring credit information, general enterprise zone assistance, job training programs, and enrolled or eligible participants can be obtained by contacting the One Stop Centers.

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Employee Questionnaire
The Employee Questionnaire is online in a PDF format.  If you need assistance, please contact the EZ Manager or the Sutter County One Stop or the Yuba County One Stop.


Hiring Credit Update
Check out whose taking part of the Hiring Credit Program. A list of those zone businesses currently receiving tax credits under the Enterprise Zone Hiring Credit Program can be found by clicking the link here.


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