If you are thinking of hiring young summer workers, there has never been a better time for it. The demand for summer jobs consistently outpaces the supply of open positions — and it's been getting worse over time.

Here's information about the government's new Summer Opportunity Project, a possible federal tax break for hiring summer youth workers and important rules to follow when you bring young adults into the workplace.

The Summer Opportunity Project

To meet the growing demand for summer employment, the government recently launched its Summer Opportunity Project. As part of this campaign, President Obama recently urged, "If you're an employer or business, give more young people their first job this summer. Work with your communities to recruit, train, and mentor young people who are out of school and work."

The government's project is a multi-agency effort that aims to increase the number of youth in summer jobs and internship programs. It includes $20 million in grants from the U.S. Department of Labor (DOL) for communities that adopt innovative approaches to providing summer and year-round career pathways for young people.

Federal and state youth programs help link teens who are searching for summer jobs with private employers through partnerships with public high schools, colleges and universities, training and economic development agencies, and not-for-profit organizations. This creates a win-win for everyone: Young workers receive paychecks and valuable hands-on training. Businesses get seasonal help and create goodwill by helping strengthen the skills base in their local communities.

Tax Break For Hiring Summer Youth Workers

In addition to making you a good corporate citizen, hiring summer help may qualify your business for the Work Opportunity credit, if you meet certain requirements. This tax break applies to qualified wages paid to new employees from certain targeted groups, including summer youth workers. The most recent extension of this credit retroactively renews the credit for 2015 and extends it through 2019.

Special rules apply to summer youth employees: For them, the credit equals 40% of up to $3,000 of first-year wages (or up to $1,200 per qualified worker). It's available only for individuals age 16 or 17 who work for your business between May 1 and September 15. The youth also must reside in an Empowerment Zone.

There's no limit on the number of eligible summer youths your business can hire and claim the Work Opportunity credit for. In addition, Work Opportunity credits generated by pass-through entities, such as S corporations, partnerships and limited liability companies, pass through to the owners' personal tax returns. If this credit exceeds your tax liability, it may be carried back or forward. 

Reap What You Sow

Most employers find that summer workers are grateful for the opportunity to earn money while gaining experience. In turn, summer hires who feel well paid and appreciated are not only more productive today, but they're also more likely to work for you again in the future.

We recommend you speak with a tax professional to see if you qualify for tax breaks for summer workers. PDM’s tax experts can help advise you on the best course of action. Contact us; with our years of technical experience, advanced training, and cutting edge technology, we are your financial partner.