Tax Credit Screening: Turning The Hiring Process Into A Profit Center
One of the largest uphill battles a franchise owner faces is combating the costs associated with hiring, training, and retaining good people, particularly in businesses with a high turnover rate. Local, state, and federal governments set aside billions of dollars every year meant to incentivize hiring that can offset these costs. Unfortunately, the complex hiring incentive landscape means that businesses are leaving millions on the table.
Three key challenges keep employers from capitalizing on tax credit opportunities.
- Employer eligibility. Franchise owners must first understand what hiring incentives they are eligible for - easier said than done. Tax credits can range from $1,000 to almost $40,000. They can be accessed by hiring veterans or individuals from targeted "in need" groups or by setting up shop in disadvantaged or designated growth areas. The diversity of credits available, coupled with varying eligibility requirements and programs that can change several times a year, leaves many businesses confused and frustrated.
- Candidate eligibility. Beyond understanding the nuances of each hiring incentive, employers have to screen applicants to determine who is eligible. And to maximize tax credit potential, screening should take place during the application process so managers can use the results to supplement decision making. The trouble is that franchise owners are often focused - and rightfully so - on an applicant's experience and fit, leaving tax credit eligibility to be an afterthought.
- Paperwork. Finally, the paperwork and submission requirements that turn a hiring incentive into a reality are daunting. Those tasked with submitting the required documentation have to be fully aware of which forms are required and how and when they should be submitted - individually or in tandem. And because form compliance is one of the largest reasons that tax credits aren't realized, even if you've hired an eligible employee, you still may not reap the benefit.
Use technology to simplify tax credits
So how can a franchise owner overcome these challenges and get their share of hiring incentives? The answer, as so often is the case, is technology.
Businesses are embracing technology that supports the hiring process. The technology that automates the hiring process more broadly is known as an applicant tracking system or a talent management (TMS).
A TMS can help employers streamline the overall hiring process - from recruiting and evaluation, to interviewing and hiring. When it comes to tax credits, these systems can be configured to help franchisees maximize hiring incentives.
The key to putting a TMS to work to transform the hiring process from a cost center to a revenue generator is integration.
A fully integrated TMS will allow you to develop an online application process that includes customized screening questions related to tax credit eligibility. Tax credit questions become part of the application, and applicants view the extra 30 seconds to two minutes that are required to complete the hiring incentive questions as just another step in the process.
Once the applicant has completed the information, an integrated TMS will generate eligibility results which are directed to the hiring manager who will see a summary of applicant information, including tax credit eligibility.
By having the entire process automated and integrated, hiring managers will be able to see eligibility before making a hiring decision, so that all other qualifications being equal, the manager can choose to interview and hire the applicant who will provide the biggest hiring incentive. Your hiring process just became a profit center.
Once you've made hiring decisions, a TMS will automatically generate and pre-populate tax credits for eligible hires. The forms can then be signed and mailed to the applicable government entity, and in many cases, your TMS provider will even remind you of when forms are due. Essentially, a TMS can take all the guesswork out of hiring incentives.
The cost of hiring a top-notch hourly workforce can be great, but hiring incentives exist that can help offset these costs and turn your hiring process into a profit center if you know how to maximize your opportunities. Complex eligibility requirements, hectic hiring schedules, and confusing documentation can make capitalizing on those opportunities seem more trouble than they're worth. But employing an integrated TMS can help you identify the applicants with the most tax credit potential, and complete and submit the right paperwork to turn hiring incentives into bottom line dollars.
Because the topic of hourly hiring incentives is such a meaty issue, Snagajob, the largest hourly employment network for job seekers and employers, developed a white paper that takes an even deeper look at tax credit potential and provides actionable advice on how to best integrate a TMS into the hourly hiring process. Download Snagajob's tax credit screening white paper here.
Jason Hamilton is senior vice presidentÂ of marketing for Snagajob, the largest hourly employment network for job seekers and employers and the only company to provide both sourcing and talent management solutions to the hourly industry.