The Act adds new subsection (u) to G.L. c. 62, § 6, allowing certain entities that hire veterans and meet certain requirements a personal income tax credit equal to $2,000 for each qualified veteran hired.3 The credit is available to any entity engaged in business in Massachusetts that: (i) is not a business corporation subject to tax under chapter 63; (ii) employs fewer than 100 employees; (iii) is certified by the Commissioner of Veteran’s Services pursuant to G.L. c. 115, § 2C; and (v) qualifies for and claims the Work Opportunity Credit allowed under I.R.C. § 51, as amended and in effect for the taxable year.
In order to claim the credit under § 6(u), the primary place of employment and the primary residence of the qualified veteran must be in Massachusetts. A business must obtain certification that the veteran is a qualified veteran from the Department of Career Services (or any successor agency), no later than the employee’s first day of work. The term “qualified veteran” is defined in I.R.C. § 51(d)(3).
A business that is eligible for and claims the credit allowed under this subsection in a taxable year, with respect to a qualified veteran employee, will be eligible for a second credit equal to $2,000 in the subsequent taxable year, subject to certification of the veteran employee’s continued employment during the subsequent taxable year. The credit will be attributed on a pro rata basis to the owners, partners or members of the legal entity entitled to the credit.
The credit is non-transferrable and non-refundable. However, any amount of credit that exceeds the tax due in the current taxable year may be carried forward to any of the three subsequent taxable years. The total cumulative value of the credits authorized pursuant to this G.L. c. 62, § 6(u) and G.L. c. 63, § 38GG (similar provision for corporate taxpayers) must not exceed $1,000,000 annually.4 The credit is available for qualified veterans hired after July 1, 2017 for tax years beginning on or after January 1, 2017.5