Federal Work Opportunity Tax Credit (WOTC)

WHAT IS THE WORK OPPORTUNITY TAX CREDIT?

 WOTC can reduce employer federal tax liability when the employer hires from targeted groups of job seekers who begin work before December 31, 2011. It is one tool in a diverse toolbox of flexible strategies designed to help those job seekers most in need of employment to gain on-the-job experience and move towards economic self-sufficiency.

The WOTC program is only for new hires and annual tax credits for hiring most target group members can receive as much as:

  • $2,400 for each new adult hire;
  • $1,200 for each new summer youth hire; and
  • $4,800 for each new disabled veteran hire; and
  • $9,000 for each new long-term family assistance recipient hired over a two-year period.

All new adult employees must work a minimum of 120 and up to 400 hours may be applied toward the tax credit. Individuals hired as Summer Youth employees must work at least 90 days, between May 1st and Sept. 15th, before an employer is eligible to claim the tax credit.

WHAT NEW HIRES CAN QUALIFY EMPLOYERS FOR WOTC?

WOTC applies to new hires who begin work between January 1, 2006 and December 31, 2011 and that belong to one of the following target groups :

HOW CAN EMPLOYERS PARTICIPATE IN THE WOTC?

Employers must apply for and receive certification from the Utah Department of Workforce Services WOTC Unit, verifying that their new hire is a member of a WOTC target group before they can claim the WOTC on their federal tax return. Utah does not accept ETA Form 9062 "Conditional Certifications".

To apply for WOTC certification, employers need only:

The State WOTC office must receive the forms, with original signatures, within 28 calendar days of the new hire's start date, either through U.S. Mail or hand delivery.

The Utah Department of Workforce Services
WOTC Unit,
1385 South State Street
PO Box 142503
Salt Lake City, Utah 84114-2503
Lanelle Windley
WOTC Specialist
Phone: 801-468-0129 or 1-800-859-3203 OR
email: lwindley@utah.gov 		OR
Hanh Nguyen
WOTC Specialist

WHAT HAPPENS AFTER AN APPLICATION IS APPROVED?

  • The Work Opportunity Tax Credit is claimed on Form 5884. (The instructions are included with the form)
  • You may also need to file Form 3800, the General Business Credit form in order to claim credit. Please note that "Instructions for Form 3800" are separate.

You may also obtain forms and instructions at http://www.irs.gov/ or, you can have them mailed to you by calling 1-800-829-3676.
Tax Law Questions should be directed to the IRS or to your tax attorney.

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