Government paperwork is something you’d normally want to avoid. That’s not necessarily true about the updated forms the Internal Revenue Service is issuing this month in connection with the HIRE Act, which gives employers incentives to hire the unemployed.

For starters, this month the IRS will issue the final version of Form W-11, “Hiring Incentives to Restore Employment (HIRE) Act Affidavit,” and a revised second quarter Form 941, “Employers Quarterly Federal Tax Return.”

On top of that, the 2010 Forms W-2 and W-3 will be revised to show that the employee had wages that exempted the employer from having to pay the employer portion of the old-age, survivor, and disability insurance portion (6.2%) of the FICA tax.

There are some rules you and your payroll department will want to be aware of, too:

• You won’t have to take into account any first quarter exempt wage amounts accumulated from March 19 through March 31 on the first quarter Forms 941 (due April 30). Those exempt wage amounts will be treated as a payment made on the first day of the second quarter on the revised Form 941 — the same way as the COBRA health subsidy was handled.
• For the subsequent quarters, you’ll report total amounts on the first page of Form 941, and reduce the liability on Schedule B of Form 941 by the amount of the tax reduction.

Go here to get additional IRS info related to the HIRE Act. The agency has announced it will be routinely updating the information.