Work Opportunity Tax Credit Program Forms Extended, New Target Group Added

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December 18, 2015

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On December 18, 2015, President Obama signed into law the Protecting Americans from Tax Hikes (PATH) Act of 2015.  The Act retroactively reauthorizes target groups of the Work Opportunity Tax Credit (WOTC) program for a five-year period, from December 31, 2014 to December 31, 2019.  It also introduces a new target group “J,” Qualified Long-Term Unemployment Recipient.

To qualify for this target group, the employee must have been unemployed for at least 27 consecutive weeks and have received unemployment compensation at some point during that time period. This new target group was previously on hold in 2015 and it now applies to employees hired after December 31, 2015.

The WOTC program is a federal tax credit available for employers who hire individuals from specified target groups, designed to encourage workplace diversity by incentivizing employers to hire applicants from groups that have consistently faced significant barriers to employment.

The expiration date for associated WOTC forms (Such as ETA 9061, 9062, and 9063) has been extended without revisions for three years, giving a new expiration date of August 31, 2018.  In submitting applications for new employees, employers may either utilize WOTC forms with the August 2018 expiration date, or continue to use form versions with the expired 2015 date, since the forms have now been extended without revisions. Both types will be accepted by state workforce agencies.

 

Action Items:

  1. Submit any completed WOTC forms that were on hold in 2015; check your state’s employment or labor departments for information on how and where to submit.

Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser.

© 2016 ManagEase, Incorporated.

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