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Federal Work Opportunity Tax Credit (WOTC)
(Wage Related Tax Incentive)


Work Opportunity Tax Credit Program for Employers
(PDF 855 KB)

Work Opportunity Tax Credit (WOTC)
IRS Code Section 190, Barrier Removal
IRS Form 8850     Instructions for Form 8850
ETA Form 9061 (For State agency use only)
ETA Form 9062

Show me the  WOTC  flowchart

Follow the link to your question????

What is it?
Who is in the targeted groups?
How does it apply to persons with disabilities?
An Iowa Vocational Rehabilitation Services referral is certified by:
Who is eligible?
What is the amount?
What are the Minimum Employment Requirements?
What agency provides the WOTC certification?
How do I file for this credit?
Where can I obtain additional information?

What is it?  The Work Opportunity Tax Credit (WOTC), which replaces the Targeted Jobs Tax Credit (TJTC) program, provides a tax credit for employers who hire certain targeted groups.

Who is in the targeted groups? Low-income, vocational rehabilitation referrals, former AFDC recipients, veterans, ex-felons, food stamp recipients, and SSI recipients. Click for detailed information

How does it apply to persons with disabilities? Employers that hire individuals who are SSI recipients or certified vocational rehabilitation (VR), State agency, Employment Network, or U.S. Department of Veterans Affairs referrals and meet all of the criteria described below may claim the WOTC.  Employers that hire individuals who received Social Security Disability Insurance and have a Ticket to Work assigned to an Employment Network may also claim the WOTC.

  • having a physical or mental disability resulting in a barrier to employment, and

  • referred to an employer upon completion of or while receiving rehabilitative services, pursuant to the Vocational Rehabilitation Act of 1973, as amended.         

  • signed employment plan with a state agency, Employment Network, U.S. Department of Veterans Affairs.

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Who is eligible? All businesses are eligible.

What is the amount?  An employer may take a tax credit of up to 40% of the first $6,000, or up to $2,400, in wages paid during the first 12 months for each new hire.

What are the Minimum Employment Requirements? Eligible employees must work 180 days or 400 hours; summer youth must work 20 days or 120 hours. A partial credit of 25% for certified employees who worked at least 120, but less than 400 hours may be claimed by the employer.

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What agency provides the WOTC certification?

WOTC Unit
Workforce Development Administrative Center
Heidi Wicks
Heidi.Wicks@iwd.iowa.gov
1000 E Grand Ave
Des Moines, IA 50319
Phone: (515) 725-2810
Fax: (515) 725-2246

How do I file for this credit?  Employers must apply for and receive certification from their State Employment Security Agency (SESA) that their new hire is a long-term family assistance recipient or member of one of the WOTC target groups before they can claim the Work Opportunity Tax Credit on their federal tax return.

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  1. Complete and submit IRS Form 8850, Prescreening Notice and Certification Request for the Work Opportunity to the above agency by the date of job offer, and

  2. Complete one of the following one-page U.S. Department of Labor forms, as appropriate:
              ETA Form 9061, "Individual Characteristics Form," if the new hire has not been given a conditional certification, or
              State agency use only--ETA  Form 9062, "Conditional Certification Form, "if provided to the job seeker by a participating agency such as the Vocational Rehabilitation agencies or the SESA/SWA, signed employment plan with a state agency, Employment Network, U.S. Department of Veterans Affairs   and 

  3. Mail the signed and dated IRS and ETA forms to the State Workforce Agency's WOTC Unit  no later than 28 days after the new hire's employment-start date.
    For your convenience, the forms are available as follows:

Where can I obtain additional information?
Office of Chief Counsel, IRS
1111 Constitution Avenue, NW
Washington, DC 20224
(202) 622-3110
800-829-1040 (voice) or 800-829-4059TTY
or
WOTC Unit
Workforce Development Administrative Center
Heidi Wicks
Heidi.Wicks@iwd.iowa.gov
1000 E Grand Ave
Des Moines, IA 50319
Phone: (515) 725-2810
Fax: (515) 725-2246


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