Hiring for the fall and winter already?

If your company hires seasonally it is extremely important to screen all incoming employees for WOTC eligibility. Employees qualify after working for you for 120 hours. That's just three weeks at 40 hours per week! Having a WOTC process in place can save you thousands of dollars off of your federal income tax bill, and getting a process in place before you plan to hire for the season is the key.

Keep in mind when screening your new workers that any relatives or former employees are not eligible for the WOTC credit. However, if you generally hire new employees as contracted employees (1099s) and then move them to permanent positions (W4s), they can qualify for WOTC eligibility at the time they become a permanent employee. You take the time to review applications and check references, why not screen for WOTC and save money too?

Have you ever thought about the difference between the Work Opportunity Tax Credit and other forms of government assistance on the subject of helping the “hard to employ” find work?  

To begin with, the categories of WOTC-eligibility are carefully defined to fit discrete target groups for improving their employment prospects.  It is true that many of these categories are defined through their receipt of a governmental benefit (TANF, e.g.), but the way the WOTC works is very different and far more practical.  

This benefit is not a “giveaway” to the disadvantaged worker, but is an incentive to the hiring employer.  And, it cannot be argued that the money “credited” to the employer is either going to be paid into the General Fund in Washington, D.C. or, it remains in the community.  In practice this directly stimulates the economy closest to where both the employer and the employee (and their families) live and work.  And, with additional “after tax” money the employer can use it to hire more workers or improve the pay and benefits of its existing workforce. And, given the Certification process conducted by state agencies for WOTC applicants, this is truly a fraud free program.

Read more about the current status of the WOTC law.