The Hiring Incentives to Restore Employment Act The Hiring Incentives to Restore Employment Act (HIRE) The Hiring Incentives to Restore Employment Act (HIRE) was signed into law by the President on March 18, 2010. This new law was designed to stimulate employment by extending the section 179 limits and by creating a Payroll Tax Holiday and $1,000 Retained Worker credit . The bill also contains numerous Offshore provisions encourage compliance in reporting foreign income. Section 179: For tax years beginning in 2010the maximum amount that can be expensed is $250,000 and the maximum amount of 179 purchases before reduction is $800,000. These are the same amounts that were allowed for 2009. Payroll Tax Holiday: Qualified employers are relieved from the employer share of OASDI tax (6.2%) on newly hired unemployed workers. The worker must be hired after February 3, 2010 and before January 1, 2011. The relief applies to wages paid after March 18, 2010 and before January 1, 2011. Workers must sign an affidavit that they have not been employed for more than 40 hours during the 60-day period before employment begins. There is no payroll tax holiday for hiring a related party.  You can find a link to the affidavit form W-11. An employer who hires someone who could qualify for both the Payroll Tax Holiday and the Work Opportunity Credit must choose between the two. He is not allowed both credits for the same person.. The Payroll Tax Holiday can't be taken for the first quarter. This gives the IRS time to revise the 941's. Otherwise allowable amounts for the first quarter can be claimed in the second quarter. Retained Worker Credit: A $1,000 credit can be claimed for each "retained worker." A retained worker is a newly hired unemployed worker ( as defined above) who was employed for at least 52 consecutive weeks and whose wages in the last 26 week period is at least 80% of the wages for the first 26 week period. A calendar year taxpayer will claim the credit on the 2011 return. Fiscal year taxpayers may have to claim the credit over two tax years. Any unused credit cannot be carried back but can be carried over.