New Tax Credits for Employers – Coming Soon!September 2021 Tax News
Two new tax credits will be available for taxpayers in the next few months.
Main Street Small Business Tax Credit II
The Main Street Small Business Tax Credit II will be available for taxpayers who were impacted by the economic disturbances in 2020 and 2021. This credit can be applied against sales and use taxes or income and franchise taxes. The credit requires taxpayers to get a tentative credit reservation from the California Department of Tax and Fee Administration (CDTFA), and to elect at that time whether to apply the credit to sales and use taxes, or to income and franchise taxes.
You must apply for the credit reservation from November 1 through 30, 2021 (or sooner, if the money available for the credit is fully allocated).
Homeless Hiring Tax Credit
The Homeless Hiring Tax Credit is a newly enacted credit available to qualifying taxpayers who hire new employees deemed to be eligible homeless individuals (as defined by RTC 17053.80 and RTC 23629). The credit amount is based on the number of hours the eligible individual (employee) works during the taxable year, and will be available for the 2022 through 2026 taxable years.
To claim the credit, qualifying taxpayers must obtain an eligible individual certification, an eligible individual certification, and receive a tentative credit reservation for each eligible individual from the FTB.
Additional information on the Homeless Hiring Tax Credit, including how to obtain the required certification and tentative credit reservation will soon be available on FTB's webpage.