While the Senate Finance Committee recently approved a two-year extension of numerous tax provisions, including the Work Opportunity Tax Credit (WOTC), this legislation is likely to linger in Congress until the end of the year. And, because the WOTC impacts American businesses, workers and employment rates, this employment-based tax credit is going to be a top-tier political issue for the 2016 Presidential campaigns.

That’s why two leading members of the House Ways And Means Committee have introduced a bill to make the WOTC permanent (Bill H.R. 2753).

The WOTC was established in 1996 with the intention of helping targeted workers become self-reliant while providing tax credits for the employers of these targeted workers. The targeted groups include veterans, ex-felons, the homeless and others with disabilities who face certain barriers to employment.

The following are already-established benefits of the WOTC program:

• Places approximately 1.5 million workers in jobs each year

• Provides one of the most cost-effective federal jobs programs

• Incentivizes employers to offer opportunities for new hires

• Returns more than $1 billion in tax credits to businesses each year

 How To Proceed: The Latest Developments Of The WOTC

Although the WOTC is currently under a legislative hiatus, it has historically been renewed. In fact, the WOTC is one of the most bi-partisanly supported and popular extenders in both Houses. That’s why businesses are still encouraged to embrace the past success of the WOTC extensions and operate as though this tax credit maintains its viability. 

With the foundation being laid to make the WOTC permanent, the current “on hold” status certainly shouldn’t affect your business’s tracking and reporting of WOTC-eligible hires.

At this point, you should still pre-screen all new hires for the tax credit so your WOTC documentation is ready and completed in a timely manner. This is also a good time to educate yourself on eligibility determinations. These are critical steps in proper credit identification to capture and maximize your tax savings.

 Partnering With An Expert Tax Consultant

As a business owner, you have a lot on your plate, every single day. Keeping up with the current legislation regarding various employment-based tax credits, such as the WOTC, is likely not the first thing on your mind.

However, the WOTC is an important tax credit with the potential to positively impact your business.

By partnering with an expert tax consultant, the burden of pre-screening, reporting and documenting to capture the WOTC is taken off of your shoulders. You won’t have to worry about a forthcoming audit by the IRS, because your tax consultant knows the proper procedures for filing for the WOTC. They should also offer audit representation if your WOTC claim come under an IRS investigation.

The right tax consultant acts as your guide to achieving tax savings by taking a very detailed approach to identifying and claiming tax credits. Planning every step of the way, your tax consultant is by your side so you reach your tax savings destination.

Ready to learn more about the WOTC and how this program can benefit your organization's bottom line? Download your complimentary, educational guide below.