Homeless Hiring Tax Credit Assembly Bill (AB) 150
California’s governor signed Assembly Bill (AB) 150 establishing the Homeless Hiring Tax Credit (HHTC). The credit is available for taxable years beginning January 1, 2022 through December 31, 2026. Employers may receive $2,500 to $10,000 in tax credit per eligible employee based on the actual hours worked in the taxable year. Employers may claim up to $30,000 of credit per taxable year.
To be eligible, the employee must be certified by a certifying organization. Employers must make a tentative credit reservation with us to claim the credit. Employers will claim the credit when they file their tax return. A total of $30 million of credit is available annually.
Eligible employer information
To claim the HHTC, employers will need to:
- Obtain an HHTC certificate for each eligible employee from a certifying organization.
- Pay wages equal to or greater than 120% of their California minimum wage.
- Make a tentative credit reservation within 30 days of completing the New Hire reporting requirement with the Employment Development Department.
Employers must keep the certificate and provide a copy to the Franchise Tax Board (FTB) upon request.
Hiring eligible employees
Obtaining certification for an eligible employee
Employers can get certification for eligible employees through a certifying organization.
Homeless Hiring Tax Credit Tentative Credit Reservation
You will need an HHTC Tentative Credit Reservation (TCR) from us to claim the credit. This will require a reservation for each eligible employee. You must submit your information online. You will receive an immediate confirmation. You must request a TCR within 30 days of completing your Employment Development Department (EDD) New Hire Reporting Requirements.
Gather the following information to complete the reservation.
|Employer Information||Employee Information|
|Type of entity (corporation, partnership, individual, etc.)||Employee’s name|
|Name of business||Social security number|
|Business ID (California Corporation number, Federal Employer Identification Number, social security number, etc.)||Date of hire|
|Address of business||Date you completed EDD New Hire Reporting requirements|
|Business contact name and phone number||Hours the employee is expected to work for the next 12 months|
|Paid preparer information
||Starting hourly wages|
|Information from the HHTC Certificate
After the above information is gathered, continue to the reservation page.
The credit amount is based on the number of hours worked by the eligible employee in the taxable year.
|Actual hours worked
(in the taxable year)
|0 – 499||$0|
|500 – 999||$2,500|
|1000 – 1499||$5,000|
|1500 – 1999||$7,500|
|2000 or more||$10,000|
Claiming the credit
You can claim the nonrefundable credit for taxable years beginning on or after January 1, 2022, and before January 1, 2027.
Any unused credit may be carried over for 3 taxable years after the year the credit was generated.
You can only claim the credit on a timely filed (including extensions) original tax return. It cannot be claimed on an amended return.
Certifying organizations include continuum of care programs and community-based service providers. A certifying organization will confirm employer and employee eligibility and provide the certification for the employer.
The HHTC Certificate is to be completed by a continuum of care or a community-based service provider to certify that the eligible individual is experiencing homelessness as defined under California Revenue and Taxation Code Sections 17053.80 and 23629. Only organizations that are connected to the local coordinated entry systems or to a local homeless management information system may certify an eligible individual.
Certifying organizations will:
- Obtain the HHTC Certificate
- Complete the certificate for each eligible employee, print, and sign
- Provide the completed certificate (or scanned copy) to the:
- Employee (to give to the employer)
Employee eligibility requirements
Eligible employees must meet the following requirements:
- Be currently or recently homeless (within 180 days of hire) or be receiving services from a homeless services provider, and
- Be certified by a certifying organization. The certificate expires 1 year after issuance.