The Work Opportunity Tax Credit (WOTC) Program is a federal tax incentive program that was designed to encourage employers to hire individuals who have historically faced barriers to employment. Each qualified new employee generally entitles you to a tax credit of either 25% or 40% of the first $6,000 in wages earned during the certified employee’s first year of employment. The maximum credit is $9,600 for qualifying veterans.
WOTC Categories / Target Groups
As part of WOTC Screening, employer needs to determine if a new hire is a member of one of the Work Opportunity Tax Credit’s 10 target groups that would make the employer eligible to receive a tax credit for hiring the individual:
- Qualified IV-A recipient
- Qualified unemployed or disabled veterans
- Supplemental Nutrition Assistance Program (SNAP) recipient
- Supplemental Security Income (SSI) recipient
- Qualified long-term unemployment recipient
- Long-term family assistance recipient
- People with felony conviction on their criminal record
- Designated Community Resident (DCR)
- Vocational rehabilitation referral
- Summer youth employee
WOTC Screening Process
WOTC screening process is simple and straight forward and can be implemented into your new employee onboarding to help your business capture available tax credit opportunities.
At Tax Credit Group, we use a proprietary screening process that is secure and 100% confidential. This ensures that employees data is safe and only used for tax credit purposes. We electronically collect answers to WOTC screening questions and then submit to the appropriate state agencies for official certification.
Tax Credit Group will perform all necessary processing and filing of qualified applications, data retention, denial appeals, and other requirements to help your business to increase tax credit opportunities.
