Work Opportunity Tax Credit

The Work Opportunity Tax Credit

The Work Opportunity Tax Credit (WOTC) is a federal income tax credit to incentivize employers to hire job seekers that have faced barriers to employment.

There are multiple target groups with income tax credits ranging from $2,400 to $9,600 per employee. Employers only have 28 days to submit employee documentation to the state for certification, WOTC is not retroactive and if the 28-day window is missed, the employer is not eligible for the credit.

WOTC Target Groups

  • Qualified IV-A (TANF) Recipient- is or has been receiving assistance under the TANF program.

  • Qualified Military Veteran- Veterans that are unemployed, disabled or receiving SNAP/EBT Card.

  • Ex-Felon- has been convicted of a felony or released from incarceration/probation/parole.

  • Designated Community Resident (DCR) - resides within a geographically designated region.

  • Vocational Rehabilitation - is or has received rehabilitative services or Ticket to Work program.

  • Summer Youth Employee- 16 -17-year-olds employed May 1 to September 15 and resides in a DCR.

  • SNAP/ EBT Card Recipient- is or has received SNAP/EBT Card benefits on or prior to employment.

  • Supplemental Security Income (SSI) Recipient- has or is receiving SSI benefits.

  • Unemployment Recipient- has been or is unemployed and has or is receiving unemployment benefits.

How NetTax can help:

NetTax’s proprietary online platform automates the WOTC screening process for new hires and document transmittal to the State saving the employer time and money. This automation will also ensure compliance with the 28-day submission deadline. Comprehensive reporting is available including yearend preparation of WOTC tax forms for filing purposes.

NetTax WOTC Platform Features:

  • The system will parse your payroll file for new hires and generate reminder emails for compliance.

  • Online kiosk mode for prescreening of new hires for eligibility. The system will determine the eligibility based on the new hire’s answers, fill out the proper forms, and submit to the state electronically.

  • 24/7 access to Online Portal to track eligibility of new hires, submission and state certification status.

  • User portal/dashboard with an easy-to-use interface where everything you need is at your fingertips.

  • Automatic reporting and tracking to see potential credits based on employee hours worked.

  • Flexibility to adapt to your onboarding process, including the ability to create a custom link to the prescreening kiosk so a new hire can do their pre-screening from home.

  • The capability to track hiring activity and WOTC submissions across multiple locations