Work Opportunity Tax Credit (WOTC) Extended Through 2019

Work Opportunity Tax Credit (WOTC) Extended Through 2019

Certain Americans, such as veterans, food stamp recipients, and teenagers on summer break from school, face steep odds in obtaining employment. However, the extension of WOTC through 2019, may help your business obtain valuable tax incentives, possibly up to $9600 per recipient hired!

Targeted groups include:

  1. Unemployed or disabled veterans
  2. Recipients of Temporary Assistance for Needy Families
  3. Food Stamp (SNAP) recipients
  4. Ex-felons
  5. Summer Youth ages 16 or 17 living in Empowerment Zones
  6. Long-Term unemployed of at least 27 weeks in which they received state or federal unemployment wages

Businesses that employ WOTC eligible individuals generally receive a tax credit equal to 25% or 40% of the new worker’s 1st year wages–up to the maximum for the group in which they belong. 25% for hires who work at least 120 hours during the 1st year of employment, and 40% if they work at least 400 hours in that 1st year; again, depending on the target group as follows:

  • $9000 for each long-term TANF recipient hired over a 2 year period
  • $4800 for each disabled veteran hired 1 year from leaving service
  • $2400 for each SNAP
  • $1200 for summer youth hired

The following individuals or groups of individuals do not qualify for this program:

  1. Employers’s relatives or deoendents
  2. Majority owners of the employer, and
  3. Former employees

Please note that many of the targeted groups referred to above have additional qualifications as well as eligibility requirements.

Therefore, please contact me before you hire someone who you think may qualify your business for this valuable tax incentive.

Mark S. Fineberg, CPA