Obama will give tax credit to firms that forgo layoffs

[question everything]

From the main story in today's WSJ:

As for the business tax package, a key provision would allow companies to write off huge losses incurred last year, as well as any losses from 2009, to retroactively reduce tax bills dating back five years. Obama aides note that businesses would have been able to claim most of the tax write-offs on future tax returns, and the proposal simply accelerates those write-offs to make them available in the current tax season, when a lack of available credit is leaving many companies short of cash.

A second provision would entice firms to plow that money back into new investment. The write-offs would be retroactive to expenditures made as of Jan. 1, 2009, to ensure that companies don't sit on their money until after Congress passes the measure.

Another element would offer a one-year tax credit for companies that make new hires or forgo layoffs, which could be worth $40 billion to $50 billion. And the Obama plan also would allow small businesses to write off a broad range expenditures worth up to $250,000 in 2009 and 2010. Currently, the limit is $175,000.

http://online.wsj.com/article/SB123111279694652423.html (subscription)

A friend of mine was told by the big boss that there are going to be layoffs in their company. I told him to show this to the boss...

[liberalmuse]

1. Wow.

Leave it to President Obama to do what I've been thinking should be done since Bush gave bailout funds to AA way back in 2001 even though they laid off tens of thousands of their workers. Except for the Warren thing, he is my dream President.

[Statistical]

2. How exactly does the govt prove the company was going to lay someone off?

I mean a credit for hiring. I understand that. Hire someone = $$$ from govt. Makes sense.

A credit for "forgoing layoffs. Couldn't a company just "pretend" they needed to layoff 10,000 people and then "didn't" thus qualifying for the credit.
$$$ for not doing something.

It would be like a $$$ credit for NOT starting to smoke.
Yup I was tempted this year but I didn't. $100 please.

Business seems to be good at scamming the govt a credit for not doing something seems almost too easy.

[cpamomfromtexas]

4. Exactly

[SlowDownFast]

6. We'll just take them at their word.

But thanks for playing.

:sarcasm:

I just figure same 'ol, same 'ol, anymore. That way I don't keep getting let down.

[anigbrowl]

7. I suspect (not having researched it yet)

that the credit would apply to wage payments which would otherwise result in a loss.

[TheHeathen]

3. Obama should also

raise taxes for companies that outsource manufacturing to other countries.

[4dsc]

5. Bad idea....