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New Jobs Credit

Introduction

SB 15 of the Third Extraordinary Session; Stats. 2009, Ch. 17 added R&TC Sections 17053.80 and 23623 operative for taxable years beginning on or after January 1, 2009.

About the credit

  • A new tax credit of up to $3,000 for each additional full-time employee hired is available to small businesses with 20 or less employees beginning January 1, 2009. The credit is prorated on an annual full-time equivalent basis for employees employed less than a full year.
  • The credit is not subject to the 50% limitation for business credits.
  • The total amount of credit available to be claimed by all taxpayers is capped at $400 million.
  • The credit must be claimed on a timely filed original return received by the Franchise Tax Board on or before a cut-off date specified by the Franchise Tax Board.
  • Taxpayers claiming the credit on an original return received by the Franchise Tax Board after the cut-off date is met will be notified that the credit has been denied.
  • Taxpayers that have been denied the credit as a result of the cut-off date being reached will not be assessed an underpayment of estimated tax or underpayment of tax penalty to the extent the underpayment was created or increased by the disallowance of this credit.

Tax credit amounts (Updated - 03/29/2014)

California allocated $400,000,000 for this tax credit. Taxpayers may only claim the credit on an original timely filed return received by the FTB on or before a cut-off date specified by FTB. The cut-off date is the last day of the calendar quarter within which FTB estimates it will have received timely filed original returns claiming the credit that cumulatively total $400 million.

New Jobs Credit generated on returns filed and processed:

The amounts below reflect the cumulative total amount of New Jobs Credit generated on Personal Income Tax (PIT) and Business Entity (BE) tax returns filed and processed as of the date indicated. Business entities include C Corporations, S Corporations, Limited Liability Companies, and Partnerships.

As of Total PIT returns filed: Total PIT New Jobs Credit
generated:
Total BE returns filed: Total BE New Jobs Credit
generated:
Total PIT & BE returns filed: Total PIT & BE New Jobs Credit generated:
02/27/2010 77 $328,599 320 $1,161,097 397 $1,489,696
03/06/2010 124 $450,143 476 $1,834,721 600 $2,284,864
03/13/2010 174 $655,664 749 $4,791,526 923 $5,447,190
03/20/2010 260 $7,173,966 1,122 $6,557,560 1,382 $13,731,526
03/27/2010 340 $7,493,159 1,212 $7,008,819 1,552 $14,501,978
04/03/2010 436 $7,790,843 1,329 $7,574,301 1,765 $15,365,144
04/10/2010 468 $7,902,480 1,456 $7,966,290 1,924 $15,868,770
04/17/2010 905 $12,554,033 1,663 $9,041,549 2,568 $21,595,582
04/24/2010 960 $13,058,664 1,694 $9,195,890 2,654 $22,254,554
05/01/2010 982 $13,126,098 1,736 $9,390,035 2,718 $22,516,133
05/08/2010 1,043 $14,249,467 1,756 $9,462,099 2,799 $23,711,566
05/15/2010 1,134 $14,519,620 1,793 $9,659,267 2,927 $24,178,887
05/22/2010 1,186 $14,804,499 1,847 $9,815,539 3,033 $24,620,038
05/29/2010 1,219 $15,008,705 1,890 $10,156,473 3,109 $25,165,178
06/05/2010 1,278 $15,159,614 1,936 $10,304,070 3,214 $25,463,684
06/12/2010 1,335 $15,333,026 2,050 $11,067,346 3,385 $26,400,372
06/19/2010 1,371 $15,428,530 2,128 $11,676,501 3,499 $27,105,031
06/26/2010 1,390 $15,445,415 2,235 $13,879,736 3,625 $29,325,151
07/03/2010 1,409 $15,480,653 2,280 $14,452,006 3,689 $29,932,659
07/10/2010 1,422 $15,501,528 2,299 $14,558,815 3,721 $30,060,343
07/17/2010 1,437 $15,582,797 2,314 $14,667,896 3,721 $30,250,693
07/24/2010 1,443 $15,607,233 2,348 $14,874,137 3,791 $30,481,370
07/31/2010 1,458 $15,714,069 2,373 $15,182,285 3,831 $30,896,354
08/07/2010 1,466 $15,735,024 2,400 $15,298,354 3,866 $31,033,378
08/14/2010 1,476 $15,766,911 2,423 $15,405,177 3,899 $31,172,088
08/21/2010 1,485 $15,790,681 2,452 $15,590,658 3,937 $31,381,339
08/28/2010 1,496 $15,847,868 2,492 $15,780,687 3,988 $31,628,555
09/04/2010 1,512 $15,924,865 2,529 $15,977,494 4,041 $31,902,359
09/18/2010 1,545 $16,041,712 2,852 $17,521,307 4,397 $33,563,019
09/25/2010 1,567 $16,190,141 2,868 $17,677,839 4,435 $33,867,980
10/02/2010 1,593 $16,249,374 2,881 $17,823,387 4,474 $34,072,761
10/09/2010 1,633 $16,358,382 2,896 $18,030,204 4,529 $34,388,586
10/16/2010 1,766 $16,823,676 2,937 $18,067,674 4,703 $34,891,350
10/23/2010 1,922 $17,347,733 2,986 $19,068,370 4,908 $36,416,103
10/30/2010 1,968 $17,747,590 3,005 $19,897,284 4,973 $37,644,874
11/06/2010 2,024 $17,972,083 3,030 $20,881,534 5,054 $38,853,617
11/13/2010 2,086 $18,180,520 3,053 $21,095,172 5,139 $39,275,692
11/20/2010 2,117 $18,337,301 3,058 $21,119,027 5,175 $39,456,328
11/27/2010 2,126 $18,390,818 3,057 $21,139,275 5,183 $39,530,093
12/04/2010 2,130 $18,395,395 3,073 $21,322,852 5,203 $39,718,247
01/08/2011 2,133 $18,398,042 3,104 $19,068,426 5,237 $37,466,468
02/05/2011 2,136 $18,401,583 3,084 $18,871,321 5,220 $37,272,904
03/05/2011 2,161 $18,490,279 3,419 $20,081,930 5,580 $38,572,209
04/02/2011 2,454 $19,688,875 4,540 $25,583,179 6,994 $45,272,054
04/30/2011 3,214 $22,497,541 5,103 $27,952,199 8,317 $50,449,740
06/04/2011 3,523 $27,412,128 6,140 $29,579,710 9,663 $56,991,838
07/02/2011 3,742 $28,529,637 6,339 $31,018,226 10,081 $59,547,863
08/06/2011 3,886 $29,271,926 6,549 $32,172,184 10,435 $61,444,110
09/10/2011 4,009 $29,962,565 6,854 $34,632,172 10,863 $64,594,737
10/01/2011 4,107 $30,365,300 7,461 $38,569,824 11,568 $68,935,124
11/05/2011 4,932 $34,010,371 7,733 $41,008,088 12,665 $75,018,459
12/03/2011 5,087 $34,641,037 7,816 $41,367,916 12,903 $76,008,953
12/31/2011 5,092 $34,642,650 7,822 $41,464,311 12,914 $76,106,961
03/03/2012 5,175 $40,838,764 8,783 $45,320,626 13,958 $86,159,390
04/07/2012 5,651 $42,754,881 10,883 $53,510,029 16,534 $96,264,910
05/05/2012 6,641 $48,022,991 11,786 $62,309,842 18,427 $110,332,833
06/05/2012 6,847 $49,698,829 12,082 $64,152,138 18,929 $113,850,967
06/30/2012 6,994 $50,368,449 12,379 $65,857,424 19,373 $116,225,873
08/04/2012 7,100 $50,855,673 12,659 $67,046,896 19,759 $117,902,569
09/08/2012 7,219 $51,310,657 13,151 $69,271,670 20,370 $120,582,327
10/06/2012 7,446 $52,647,978 14,555 $77,963,821 22,001 $130,611,799
11/04/2012 8,328 $57,523,760 14,694 $79,097,209 23,022 $136,620,969
12/01/2012 8,596 $58,459,489 14,739 $79,697,994 23,335 $138,157,483
12/29/2012 8,621 $58,545,595 14,790 $79,894,329 23,411 $138,439,924
03/04/2013 8,668 $58,854,115 15,677 $83,600,087 24,345 $142,454,202
04/06/2013 9,186 $61,023,184 18,231 $94,474,913 27,417 $155,498,097
05/04/2013 10,318 $65,782,294 19,134 $97,906,512 29,452 $163,688,806
06/01/2013 10,634 $67,361,823 19,753 $100,932,437 30,387 $168,294,260
07/06/2013 10,918 $68,786,383 20,321 $103,880,806 31,239 $172,667,189
08/03/2013 11,054 $69,476,581 20,741 $107,506,396 31,795 $176,982,977
08/31/2013 11,179 $70,128,020 21,181 $110,298,801 32,360 $180,426,821
10/05/2013 11,509 $71,580,542 23,259 $123,409,775 34,768 $194,990,317
12/28/2013 12,766 $85,382,710 23,607 $125,721,041 36,373 $211,103,751
03/22/2014 13,428 $86,934,712 27,538 $144,758,527 40,966 $231,693,239
03/29/2014 13,566 $87,535,149 27,830 $146,046,326 41,396 $233,581,475

We plan to update this webpage monthly to show cumulative totals to date.

To qualify

  • An employer will qualify for the credit if:
    • Each qualified full-time hourly employee is paid wages for not less than an average of 35 hours per week.
    • Each qualified full-time employee that is a salaried employee was paid compensation during the year for full-time employment within the meaning of Section 515 of the Labor Code.
    • On the last day of the preceding taxable year, they employed a total of 20 or fewer employees.
    • There is a net increase in qualified full-time employees compared to the number of full-time employees employed in the preceding taxable year. For taxpayers who first commence doing business in California during the taxable year, the number of qualified full-time employees employed in the preceding year would be generally be zero, unless certain special rules apply.

Exceptions

  • An employer may not claim the credit for those employees who are any of the following:
    • Certified as a qualified employee in an enterprise zone or targeted tax area.
    • Certified as a qualified disadvantaged individual in a manufacturing enhancement area.
    • Certified as a qualified disadvantaged individual or qualified displaced employee in a local agency military base recovery area.
    • An employee whose wages are included in calculating any other credit allowed.

Claiming the credit

More information

  • New Jobs Credit Frequently Asked Questions (Updated - 2/18/10)
  • Check this page for any updated information regarding this credit.
  • See the instructions included with Form 3527.
  • Call us:
    • 800.852.5711 from within the United States
    • 916.845.6500 from outside the United States (not toll-free)