WOTC_Job_Seekers

WOTC_Job_Seekers

Work Opportunity Tax Credit (WOTC) - for Job Seekers


Job Seekers meeting certain criteria are encouraged to apply for specific jobs when an employer is eligible for a tax credit for hiring them.
 
WOTC is a Federal tax credit available to employers who hire and retain veterans and/or individuals from other target groups with significant barriers to employment.
 
The tax credit employers can claim depends upon the target group of the individual hired, the wages paid to that individual in the first year of employment, and the number of hours that individual worked. There is also a maximum tax credit that can be earned.
 
Veterans & other target groups: Definitions 
Look at the definitions to see if you qualify as a prospective tax credit job seeker under one of the eight categories below. Then fill out one of the forms below that.
 
  • Veterans
  • Temporary Assistance for Needy Families (TANF) Recipients
  • Supplemental Nutrition Assistance Program (SNAP) Food Stamp Recipients
  • Designated Community Residents (living in Empowerment Zones or Rural Renewal Counties)
  • Vocational Rehabilitation Referral
  • Ex-felons
  • Supplemental Security Income Recipients
  • Summer Youth Employee (living in Empowerment Zones)
 
For long-term Temporary Assistance for Needy Families (TANF) applicants, credit is available to employers who hire members of this group for up to a two-year period.
 
  • In the first year, the employer may claim a tax credit equal to 40% of the first-year wages, up to the maximum tax credit, if the individual works at least 400 hours.
  • In the second year, the employer may claim a tax credit equal to 50% of the second-year wages, up to the maximum tax credit, if the individual works at least 400 hours.
 
For all other target groups, the credit is available to employers who hire members of these groups, based on the individual's hours worked and wages earned in the first year.
 
  • If the individual works at least 120 hours, the employer may claim a tax credit equal to 25% of the individual's first year wages, up to the maximum tax credit.
  • If the individual works at least 400 hours, the employer may claim a tax credit equal to 40% of the individual's first year wages, up to the maximum tax credit.
To electronically send non-TANF WOTC forms and support documentation such as your address, drivers license number, rehabilitation letters and/or military documentation you must scan the document, reference the person it pertains to and email it to: des.wotc@illinois.gov​. 
 
Or you may mail it.
 
PLEASE BE SURE ALL FORMS/DOCUMENTATION ARE SUBMITTED IN AN ORDERLY FASHION (e.g. by page number) TO HELP WOTC STAFF EXPEDITE PROCESSING
 
Mailing address:
 
IDES - WOTC Unit
33 South State Street, Suite 1040
Chicago, IL 60603​
 
WOTC Job Seeker Forms: 
 
Complete ETA Form 9061 if you have been conditionally certified as belonging to a WOTC target group by a state workforce agency (IDES, DHS or DCEO), Vocational Rehabilitation agency, or another participating agency.
 
Spanish Language Forms:
Please note that ONLY English forms may be submitted to IDES. Spanish language forms are only intended as an aid to Spanish speakers by employers.
 
WOTC Tax Credit Amounts for the Eight WOTC Categories:
 

 
Summary of Legislative Provisions:
 
On December 18, 2015, President Obama signed into law the Protecting Americans from Tax Hikes Act of 2015 (the PATH Act) that extends the Work Opportunity Tax Credit (WOTC) retroactively for hires from December 31, 2014 to December 31, 2019. This document provides information and interim instructions to help the State Workforce Agencies (SWAs) like IDES implement the PATH Act’s legislative provisions. The Employment and Training Administration (ETA) and the Internal Revenue Service (IRS) will be issuing formal guidance soon and updating WOTC forms as needed.
 
The PATH Act amends Section 51(c)(4) of the Internal Revenue Code of 1986. In summary, Title I—“Extenders,” Subtitle B—“Extensions Through 2019,” Section 142, “Extension and Modification of Work Opportunity Tax Credit,” of this Act:
 
  • Retroactively reauthorizes the WOTC program with all its current target groups, without changes or new provisions, for a 5-year period, after December 31, 2014 to December 31, 2019;
  • Introduces a new target group, a Qualified Long-term Unemployment Recipient, which is defined as any individual who is certified by the designated local agency as being in a period of unemployment which:
    • is not less than 27 consecutive weeks, and
    • includes a period in which the individual was receiving unemployment compensation under State or Federal law.

Qualified Wages For New Qualified Long-term Unemployment Recipient Target Group 

The 1996 legislative provisions that apply to most adult non-veteran target groups for “qualified wages” and amount of the tax credit employers can claim for new hires certified under those target groups also apply to the new target group employees hired after December 31, 2015. Qualified wages for certified new hires under the new Qualified Long-term Unemployment Recipient target group are also capped at $6,000 dollars, during the first year of employment, for a maximum tax credit of up to $2,400 depending on the number of hours the new hire works (i.e., how they meet the provisions of the Minimum Employment or Retention Period).
 
Tax Credit Amounts and the Minimum Employment or Retention Period For New Qualified Long-term Unemployment Recipient Target Group. 
 
  • For WOTC certified new hires working at least 120 hours, employers can claim 25% of the first year wages paid up to $6,000 for a maximum income tax credit of up to $1,500, or For WOTC certified new hires working 400 hours or more, employers can claim 40% of the first year wages up to $6,000 for a maximum income tax credit of up to $2,400.
  • The PATH Act retroactive extension applies to individuals who begin work for an employer [and are certified under any of the existing current target groups] after December 31, 2014 and
  • The PATH Act provisions that cover the new target group apply to individuals who begin to work for an employer after December 31, 2015, i.e., on or after January 1, 2016.
  • The legislative authority for the Empowerment Zones (EZs) expired on December 31, 2014.
 
The PATH Act reauthorized the EZs for a 2-year period through December 31, 2016 (see Section 171 of the PATH Act, attached).
​The IRS generally provides information and guidance as soon as it becomes available at www.irs.gov

 
All related questions should be sent to the Ask.WOTC@dol.gov e-mail account.
 
For more information, please contact:
 
Felicia Clark – Felicia.Clark@illinois.gov or phone, 312-793-6811
Patrick Durkin – Patrick.Durkin@Illinois.gov or phone, 312-793-9601
Or fax documents to: 312-793-5151 
 
Or mail to:
 
IDES - WOTC Unit
33 South State Street
10th Floor
Chicago, Illinois 60603

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