Follow Chad Linkedin
Email Chad Email
Financial
Jan 25, 2017

Tax Credit For Hiring Targeted Employees

Sponsored Content provided by Chad Wouters - Partner, Earney & Company, LLP

At the end of 2015, the U.S. House and Senate passed the Protecting Americans from Tax Hikes Act of 2015 (PATH). The PATH retroactively reauthorizes the Work Opportunity Tax Credit (WOTC) program for a five-year period, from Dec. 31, 2014 to Dec. 31, 2019.

WOTC is a federal tax credit available to employers for hiring individuals from certain target groups, who have consistently faced significant barriers to employment. WOTC joins other workforce programs that incentivize workplace diversity and facilitate access to good jobs for American workers.

Target groups for WOTC include:

  • Unemployed veterans
  • Temporary Assistance for Needy Families recipients
  • Food stamp recipients
  • Designated Community residents
  • Vocational Rehabilitation-referred individuals
  • Ex-felons
  • Supplemental Security Income recipients
  • Summer youth employees
  • Qualified Long-Term Unemployment tecipients
For employers to qualify for the credit they must:
  • File Form 8850 - Pre-Screening Notice and Certification Request for the Work Opportunity Credit - which is usually due no later than 28 days after an employee begins work.
  • Taxable employers must claim the tax credit, after the required certification is secured, as a general business credit on Form 3800 against their income tax by filing:
    1. Form 5884
    2. Form 3800
    3. You business’s related income tax returns
  • Tax-exempt employers must claim the credit against the employer social security tax by separately filing Form 5884-C after the required certification (Form 8850) is secured and after filing the related employment tax return for the period that the credit is claimed.
The credit is limited to the amount of the business income tax liability or social security tax owed. A taxable business may apply the credit against its business income tax liability, and the normal carry-back and carry-forward rules apply. For qualified tax-exempt organizations, the credit is limited to the amount of employer social security tax owed on wages paid to all employees for the period the credit is claimed.

If you are uncertain if you are an employer who qualifies for WOTC, feel free to contact one of our tax professionals at Earney & Company, L.L.P. at (910) 256-9995.

Chad Wouters, CPA joined Earney & Company in December 2006 and became the tax partner in November 2013.  With an emphasis on strategy and planning, Chad works with his clients all year to ensure the most efficient tax strategies are put into place.  Earney & Company, L.L.P.  is a CPA firm that handles tax compliance, consulting and planning as well as audit and other assurance services.  For more information please visit www.earneynet.com or call (910) 256-9995.  Chad can also be reached at [email protected].
 


 

Ecolarge
Ico insights

INSIGHTS

SPONSORS' CONTENT
Headshot 131850046

How to Make a Million in Real Estate

Kirk Pugh - KBT Realty
Mike stonestreet 300x300

For Association Boards, CAI Membership has its Privileges

Mike Stonestreet - CAMS (Community Association Management Services)
Img 0621

What to Do if You Don't Have a W-2

Karen Durda - Century Accounting and Tax Services, Inc.

Trending News

Changes Coming To Hanover Center, Oleander Drive Site

Cece Nunn - Feb 21, 2018

Downtown Wilmington Store Moving To Mayfaire Town Center

Cece Nunn - Feb 22, 2018

Papanikolaou Family Opens Symposium At Mayfaire

Jessica Maurer - Feb 21, 2018

South Front Phase II Apartments Fully Leased

Christina Haley O'Neal - Feb 20, 2018

Peño Mediterranean Grill Welcomes Customers To New Location  

Jessica Maurer - Feb 21, 2018

In The Current Issue

Commerce Park Attracts More Firms

After two years of a lull without new tenants, a national logistics company and statewide beverage distributor are now planning to invest in...


CFEDC Announces New Leadership, Events

The Cape Fear Economic Development Council has announced new leadership and an increase in its activities this year....


Firms Find Benefits In Mergers

The Cheek family operated an Ocean Isle Beach-based residential real estate firm, Resort Brokerage, for nearly two decades years before deci...

Book On Business

The 2018 WilmingtonBiz: Book on Business is an annual publication showcasing the Wilmington region as a center of business.

Order Your Copy Today!


Galleries

Videos

WilmingtonBiz Expo - Keynote Lunch with John Gizdic, CEO, New Hanover Regional Medical Center
Wilmington's Most Intriguing People of 2017
2017 Health Care Heroes