Work Opportunity Tax Credit

production workers_web

On December 18, 2015, President Obama signed into law the Protecting Americans from Tax Hikes Act of 2015 that extends the Work Opportunity Tax Credit (WOTC) program until December 31, 2019. The 5 year reauthorization includes retroactively reauthorizing the WOTC program with all its current target groups without changes or new provisions, for a 5-year period, after December 31, 2014 to December 31, 2019.

There has been a new target group added to the program called Qualified Long-Term Unemployment Recipients for new hires from January 1, 2016 through December 31, 2019.

The Work Opportunity Tax Credit helps people move from welfare to work and gain on-the-job experience by encouraging private employers to hire within one of several targeted groups of job candidates who traditionally face significant barriers to employment, reducing employer’s federal income tax liability by as much as $2,400 per qualified new worker in the first year of employment. The targeted candidates are:
  • Cash assistance recipients
  • Qualified long-term unemployment recipients 
  • Veterans receiving food stamps
  • Disabled veteran
  • Unemployed veteran
  • Disabled unemployed veteran
  • 18-to-39-year-old recipients receiving food stamps
  • 18-to-39-year-old residents living in a rural renewal county
  • Vocational rehabilitation referrals
  • Ex-felons
  • SSI recipients
  • Ticket-to-Work holders
The disabled unemployed veteran target group can save employers up to $9,600 in the first year of employment.

Electronic submittal of forms: