WORK OPPORTUNITY TAX CREDIT
Revcon Solutions has partnered with Growth Management Group (GMG), in an effort to help our clients save up to $9,600 for every qualified employee they hire. GMG's software searches hundreds of Local, State, and Federal Tax Credits in real time... every time.
WHAT IS WOTC?
The Work Opportunity Tax Credit (WOTC) is a U.S. government program designed by the Internal Revenue Service that incentivizes companies to hire and retain individuals from target groups with significant barriers to employment. These groups include veterans, long-term unemployed individuals, disabled individuals, Supplemental Nutrition Assistance Program (SNAP) recipients, other public assistance participants, and more.
Employers claim about $1 billion in tax credits each year under the WOTC program. There is no limit on the number of individuals an employer can hire to qualify to claim the tax credit, and there are a few simple steps to follow to apply for WOTC.
WOTC credits are calculated as a percentage of qualified employees’ wages based on the hours they work (full-time or part-time), and usually range from $1,200 to $9,600 per qualified employee, with most qualified employees generating an average $2,400 in tax credits. This can add up to significant cost savings for your organization.
A strong WOTC approach begins with evaluating the applicants your organization attracts for potential credit opportunities.
Our software does this through a simple eleven-question survey thats emailed directly to your new hire candidate. These questions only take 60-90 seconds for the majority of applicants to answer, quickly and easily gathering the qualifying data needed to make a decision on WOTC eligibility.
You will also able to track each applicant’s completion status for the survey and see the estimated credits you’ll receive from qualified applicants within your WOTC software.
MINIMUM RETENTION PERIODS AND MAXIMUM TAX CREDIT AMOUNTS
Through the Work Opportunity Tax Credit (WOTC) Program, employers have the opportunity to earn a federal tax credit between $1200 and $9600 per employee. This tax credit is dependent upon the new employee qualifying as a member of one of the below target groups and working a minimum of 120 hours in their first year.
A “qualified veteran” is a veteran who is any of the following:
A member of a family receiving assistance under the Supplemental Nutrition Assistance Program (SNAP) (food stamps) for at least 3 months during the first 15 months of employment.
Unemployed for a period totaling at least 4 weeks (whether or not consecutive) but less than 6 months in the 1-year period ending on the hiring date.
Unemployed for a period totaling at least 6 months (whether or not consecutive) in the 1-year period ending on the hiring date.
A disabled veteran entitled to compensation for a service-connected disability hired not more than one year after being discharged or released from active duty in the U.S. Armed Forces.
A disabled veteran entitled to compensation for a service-connected disability who is unemployed for a period totaling at least six months (whether or not consecutive) in the one-year period ending on the hiring date.
VETERAN TARGET GROUP
TEMPORARY ASSISTANCE FOR NEEDY FAMILIES (TANF)
A “long term family recipient” is an individual who at the time of hiring is a member of a family that meet one of the following conditions:
Received assistance under an IV-A program for a minimum of the prior 18 consecutive months; OR
Received assistance for 18 months beginning after 8/5/1997 and it has not been more than 2 years since the end of the earliest of such 18-month period; OR
Ceased to be eligible for such assistance because a Federal or State law limited the maximum time those payments could be made, and it has been not more than 2 years since the cessation.
An individual who is a member of a family receiving assistance under a state plan approved under part A of title IV of the Social Security Act relating to Temporary Assistance for Needy Families (TANF). The assistance must be received for any 9-month period during the 18-month period ending on the hiring date.
TEMPORARY ASSISTANCE FOR NEEDY FAMILIES (TANF)
Supplemental Nutrition Assistance Program Recipient (Food Stamps)
A “qualified SNAP benefits recipient” is an individual who on the date of hire is:
At least 18 years old and under 40, AND
A member of a family that received SNAP benefits for:
the previous 6 months OR
at least 3 of the previous 5 months.
SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM (SNAP)
Designated Community Resident (DCR)
A DCR is an individual who, on the date of hiring
Is at least 18 years old and under 40,
Resides within one of the following:
An Empowerment zone
An Enterprise community
A Renewal community
AND continues to reside at the locations after employment.
DESIGNATED COMMUNITY RESIDENT (DCR)
Vocational Rehabilitation Referral
A “vocational rehabilitation referral” is a person who has a physical or mental disability and has been referred to the employer while receiving or upon completion of rehabilitative services pursuant to:
A state plan approved under the Rehabilitation Act of 1973 OR
An Employment Network Plan under the Ticket to Work program, OR
A program carried out under the Department of Veteran Affairs.
VOCATIONAL REHABILITATION REFERRAL
Summer Youth Employee
A “qualified summer youth employee” is one who:
Is at least 16 years old, but under 18 on the date of hire or on May 1, whichever is later, AND
Is only employed between May 1 and September 15 (was not employed prior to May 1st) AND
Resides in an Empowerment Zone (EZ), enterprise community or renewal community.
SUMMER YOUTH EMPLOYEE
Qualified Long-Term Unemployment Recipient
A qualified long-term unemployment recipient is one who has been unemployed for not less than 27 consecutive weeks at the time of hiring and received unemployment compensation during some or all or the unemployment period.
QUALIFIED LONG-TERM UNEMPLOYMENT RECIPIENT
When you hire an employee, you have only 28 days from the hire date to submit the required forms for WOTC and your candidate must complete survey before or on hire date. A qualified employee must work 400 hours to make the employer eligible for the full credit, while at least 120 hours worked is required for a partial credit.
By utilizing our WOTC software, it manages the whole WOTC filing process for you — screening for eligible applicants, calculating earned credit value, and generating the tax packages needed to claim credits — with no need for paper forms or complex manual processes. Beyond just providing information for WOTC claims, the software also searches hundreds of local, state, and federal tax credits opportunities in real time.
Activate now and within minutes you'll be able to start screening your candidates.