MainStreet.com: Hire a Veteran, Save on Taxes

"The business doesn't have to be in the same rural renewal county, but can be in a metropolitan city and draw people from the rural county," says Christian. "That really liberalizes the WOTC program."

And, if an employee received welfare benefits before becoming starting work, the federal Welfare-to-Work program offers business a credit worth up to $8,500 during a two-year employment period.

The WOTC isn't the only credit available to businesses hiring veterans. Enterprise Zone Programs, which are designed to stimulate economic growth in economically depressed areas, can be found in 41 states. Military veterans within four years of service, active-duty or reserve, can qualify their employers for $37,000 in credits during a five-year period under this state-sponsored program.

The specifications vary from state to state, but it is not uncommon for a business to be able to claim 50% of the veteran employee's first year of W-2 wages, up to $12 an hour. For years two through five that the veteran is employed, the business receives a 40%, 30%, 20% and 10% credit, respectively.

"One person can qualify for multiple benefits," adds Christian. "Sometimes when you receive several, some of the credits are scaled back from one benefit because you're double-dipping." But, there are plenty of credits that don't overlap, offering employers multiple incentives to hire veterans.

For business owners interested in hiring veterans, the first step is to talk to an accountant, Christian says. And don't accept the argument that the credits might make your paperwork too much of a hassle. "It's usually one extra form in the return, and the payoff is very significant on your labor costs," Christian adds.