Work Opportunity Tax Credits (WOTC)

What is Work Opportunity Tax Credit (WOTC)?

Work Opportunity Tax Credits (WOTC) are Federal tax credits available to employers for hiring individuals from certain targeted groups who have consistently faced significant barriers to employment, rewarding them for every new hire who meets eligibility requirements.

What groups of employees can an employer claim the WOTC?

• Qualified IV-A recipient
• Qualified veteran
• Qualified ex-felon
• Designated community resident
• Vocational rehabilitation referral
• Summer Youth Employee
• Recipient of SNAP benefits (food stamps)
• Supplemental Security Income (SSI) recipient
• Long-term family assistance recipient
• Qualified Long-term unemployment recipient.

What are the benefits of WOTC?

WOTC joins other workforce programs that incentivize workplace diversity and facilitates access to good jobs for American workers. The WOTC program creates a positive impact on the nation's unemployment levels by helping these groups of people secure employment so they can obtain the skills and experience necessary to land better jobs in the future.

As an employer, how do I claim WOTC?

As a client of ApplicantPro, we offer an integration with WOTC that allows applicants to voluntarily complete a short questionnaire upon completing an application. The answers to the questionnaire will tag an applicant as "eligible" if they meet the WOTC criteria. If an eligible applicant is hired, system users can submit the relevant applicant information and survey answers to WOTC.com, which will use the record to manage the necessary reporting for these qualified hires. Together with WOTC.com, we will ensure that your organization receives every tax credit that is owed.

Should an employer choose to handle their own WOTC tax credits, the employer and applicant must complete Form 8850 on or before the day the offer of employment is made. Form 8850 must be submitted to the designated local agency located in the state in which the employee will be working. An employer has 28 calendar days from the new employee's start date to submit this form.

To learn more about how to stay compliant by tracking and reporting necessary data, check out our Reporting page.