WORK OPPORTUNITY TAX CREDIT

1. WORK OPPORTUNITY TAX CREDIT
The Work Opportunity Tax Credit (WOTC) is a federal tax Family Assistance and a second change was the creation
credit that reduces the federal tax liability of private-for- of the new Disabled Veteran target group that went into
profit employers. Employers can hire from twelve differ- effect May 25, 2007. On February 17th as part of the
ent targeted groups: American Recovery and Reinvestment Act (ARRA) of
♦ Qualified Temporary Assistance to needy Families 2009 two new categories were created Unemployed Vet-
Recipients (TANF) erans and Disconnected Youth.
♦ Qualified Veterans/Disabled Veterans
♦ Unemployed Veterans The WOTC Program has been reauthorized until
♦ Qualified Ex-felons August 31, 2011
♦ Qualified Designated Community Residents (DCR)
residing in an Empowerment Zone (EZ), Renewal
Community (RC), or in a Rural Renewal County (RRC) What makes us so effective? Not only do we offer the
screening tools and credit calculations, but in order for
♦ Qualified Vocational Rehabilitation Agency Referrals
your company to maximize your potential benefit your tax
♦ Disconnected Youth partner must do more. That’s why we assist all of our
♦ Qualified Summer Youth (SY) clients in the following areas:
♦ Qualified Food Stamp Recipients (FS) ♦ Customizable screening options which includes
♦ Qualified Supplemental Security Income Recipients ♦ Live operator phone screening
(SSI)
♦ Conventional paper screening
♦ Qualified Long-Term Family Assistance Recipients
♦ We help manage internal compliance
(LTFAR)
♦ Match screened new employees to actual new
♦ Hurricane Katrina Employee
hires.
Maximum Credit Available ♦ Identify non-compliant areas, and work with
them to make them compliant
♦ $1,200 for each new Summer Youth* hired;
♦ Educate hiring managers about the credit
♦ $2,400 for each new Adult hired;
♦ Make sure that supervisors are aware of em-
♦ $4,800 for each new Disabled Veteran hired; and
ployees eligibility so the company maximizes
♦ $9,000 for each new Long Term Family Assistance
the credit.
Recipient hired over a two year period.
♦ Identify how employer can target potentially
*The credit is based on 40% of up to $6,000 in qualified certifiable job candidate pools.
wages during the first year of employment. Summer COST-
FOR A COST-FREE ANALYSIS ON WHETHER YOUR COMPANY
Youth qualify for 40% of the first $3,000 in wages during (WOTC),
QUALIFIES FOR WORK OPPORTUNITY TAX CREDITS (WOTC),
the required working period of May 1 through September PLEASE CONTACT:
15.
PayChoice Tax Incentives Department
Minimum Employment or Retention Period TaxCredits@paychoice.com
All new employees must work a minimum of 120 hours Or
and individuals hired as Summer Youth employees must 888-811-7988
work at least 90 days, between May 1 and September
15, before an employer is eligible to claim the tax credit.
Recent program changes took place in 2007 that im-
pacted multiple target groups. One such change was the
consolidation of the Welfare-To-Work Tax credit program
into the WOTC program to become known as Long-Term
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