The WOTC can be a lucrative incentives program for many businesses that hire employees who typically face barriers to employment such as ex-felons or welfare recipients. This has prevented many companies from pursuing the WOTC because they are under the impression that they don’t hire employees falling under any of the WOTC target groups. With the latest update to the WOTC, the program now has universal appeal.

Section 142 of the PATH Act officially includes the long-term unemployed (meaning the person must be unemployed for at least 27 consecutive weeks and received unemployment compensation for a period of time). The maximum credit per employee under this category is $2,400.

Is It Too Time-Intensive Or Expensive To Capture The WOTC?

In the past you may have thought the process for capturing the WOTC was too cumbersome, too administratively challenging or that the benefit wasn’t significant enough. All of this is different now because of the following three game-changing benefits of the new WOTC updates:

• The new target category is generic enough to apply to every industry. The long-term unemployed isn’t based on receiving public assistance or living in certain areas, so this new category makes a material difference in the amount of people who qualify.
• As with the last two WOTC program extensions, there will likely be a retroactive screening period (also known as “transitional relief”) that will offer employers an opportunity to screen and capture credits for 2015 hires. It should be noted that the period to capture these tax credits retroactively would be limited.
• The process for capturing the WOTC has seen advances in technology and one of the most significant advances is e-signatures. The acceptance of e-signatures by state Department of Labor offices has streamlined the process of acquiring applicants’ signatures and often times leads to 100% screening compliance for many businesses. This saves both time and resources from having to amass wet signatures and has also helped business save money since there is no longer a need to mail in a physical form.

In addition to the federal credit, there is also a number of state point-of-hire credits. In order to take advantage of these credits, it is necessary to have a system in place for screening new employees. Once a screening process is implemented, necessary employee information is captured in real time and companies can easily meet the time requirements of the WOTC and other point-of-hire incentives with no additional work or time on behalf of the business.

To begin screening for the WOTC and other incentives, it is recommended that you outsource with a WOTC expert with proven best practices for implementation. If you’re hiring more than 50 employees a year, it’s time to begin planning for this program.

One of the most beneficial aspects of participating in the WOTC program is that it provides another source of revenue for your business. Significant tax savings may support any number of operational goals you may have on the horizon.

The WOTC is a tax benefit that goes right to the bottom line – available money you deserve to capture and put back into your business to drive success.

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