Roundup of Tax Credits
Just as deductions offset business income, tax credits offset tax liability. In effect, tax credits are considerably more valuable than deductions since they offset taxes on a dollar-for-dollar basis.
Businesses may be entitled to a variety of credits that Congress created to encourage certain activities—hiring special workers, using alternative energy sources, pouring money into research, and so on. Not every business credit applies to small business owners (but all business-related credits are listed within this chapter to alert you to their existence).
Many of these credits have been discussed throughout this book in the chapter to which they relate. However, here you will find a roundup of tax credits, a brief explanation of what they are all about, and where you can find more information on them within this book (see Table 23.1, page 487).
Employment-Related Credits
The tax law encourages you to hire certain workers by permitting you to claim tax credits for certain wages you have paid.
WORK OPPORTUNITY CREDIT
The work opportunity credit applies for hiring workers from certain economically disadvantaged designated groups:
Employment credits reduce ...
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