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Tax Credits for Employers of Military Reservists

This act introduces new tax credits for small and medium-sized businesses that employ members of the National Guard or Armed Forces reservists. The goal is to encourage employers to support individuals serving in the military, which can help reservists find employment and financial stability.
Key points
Businesses with fewer than 500 employees can receive a tax credit of 40% of wages paid to reservists.
The credit amount depends on the number of days of service by the reservist in a given year, with a maximum of up to $10,000 per reservist annually.
The credit can be deducted from income tax or, in some cases, from payroll tax, potentially providing faster financial benefits for employers.
The changes apply to wages paid in taxable years beginning after December 31, 2020.
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Additional Information
RECRUIT Act of 2021
Print number: HR 1854
Sponsor: Rep. Ryan, Tim [D-OH-13]
Process start date: 2021-03-11