Hiring IncentivesSave up to $9,600 for every qualified employee you hire.
As a result of the multitude of stimulus packages offered through various governmental agencies there exists substantial opportunities for employers to realize financial benefit through qualification for hiring incentive tax credits. Local, State, and Federal tax incentive programs allow employers to reduce taxable liability of private-for-profit employers for the hiring of qualified individuals.
- We review every applicable stimulus package through studies that are performed to determine the eligibility of current and future employees in order to assess potential tax credit. This includes the Workers Opportunity Tax Credit. The WOTC is available to employers who hire and retain from target groups. The average credit per qualified employee is $2,400 and can be as much as $9,600.
- WOTC is a Federal tax credit created by the Small Business Job Protection Act of 1996 and the Welfare-to-Work Tax Credit of 1996. Employers claim about $1 billion in tax credits each year under the WOTC program. There is no limit on the number of individuals an employer can hire to qualify to claim the tax credit, and there are a few simple steps to follow to apply for WOTC.
- Timely submission is critical. We have created an electronic system that makes applying for WOTC easy to use for any company. We've eliminated all the difficulties of this process with the creation of our exclusive Client Portal. We've provided you an easy way to pre-qualify and capture your tax credits. You enter a candidate into your client portal, and our system does the rest. After a candidate is screened we handle all Local, State, and Federal paperwork.
- You create a master account for your business. From there you will be able to add specific locations, job positions, as well as hiring managers who can also access the system.
- Example: Prequalification of Hiring Incentives based on annual hirings of 25 is about an estimated savings of $36,000.
Hiring Incentives Frequently Asked Questions
How is the WOTC Tax Credit claimed?
WOTC is a general business credit and can offset federal income taxes and can be carried back to the prior year or carried forward 20 years. After an employee has been qualified and the certification secured, a taxable employer may claim the tax credit as a general business credit against their income tax using IRS form 3800.
Is WOTC the Only Program We Review?
WOTC is a great program to start out with. But clients will benefit from looking at all Employer Based Tax Incentives. The most notable two programs in addition to WOTC are Section 41 R&D Tax Credit, and the Startup Tax Credits. Virtually any business can now benefit from Employer Based Tax Incentives because even candidates that don't qualify for WOTC often qualify for other tax incentives.
What Types of Employees Qualify?
Although many of these programs started out as programs specifically designed for Veterans, they were expanded in the 80's and 90's to include broader groups such as TANF Recipients, SNAP (Food Stamp) Recipients, Residents living in Empowerment Zones or Rural Renewal Counties), Employees receiving certain types of vocation training, Ex-Felons, Supplemental Security Income Recipients, Summer Youth Employees, and Seasonal Workers.
The Financial Meltdown in the mid 2000's brought about a renewed focus on Job Creation. With this we saw massive expansion of Federal Tax Incentives for creating, and maintaining jobs. This was done through the Small Business Jobs Act, The American Recovery and Reinvestment Act, Numerous Job Creation and Protection Acts, and most notable the PATH Act signed by President Obama for effective changes in 2016 through 2022.
The pattern in the last decade is that with the passing of each Act, more and more companies are eligible for Employee based Tax Incentives that broaden not only WOTC itself, but hundreds of programs that surround it.
How does our wotc service differ from payroll companies?
We differ from payroll companies in many ways. We give the client the ability to view candidates as part of the on-boarding process and most payroll companies only allow clients to view the employees after being hired.
Many companies think their payroll company is already taking care of this for them. From our experience, the vast majority of companies are either not taking these types of tax incentives at all, or they are taking only small fractions of what is available.
If a client is not completing a form 8850 with each and every new candidate they consider for employment, they are not taking advantage of this Tax Credit. This process is more operational than it is payroll based. Because most payroll companies are not involved in the client's interviewing and candidate process, it is rare that this is being taken advantage of.
Our system is electronically based which means that the clients do not need to obtain paper documents from candidates for the survey. This aids in ease of use as well as ensuring confidentiality for the candidates. The candidate then will answer more honestly as they are submitting fully confidential via the electronic survey.
Further, we put control in the hands of the client, something other WOTC providers do not do. We offer the client to fully control candidates surveyed, employees hired, etc.
Doesn't my CPA or Payroll Company take care of this for me?
Many companies think their CPA or payroll company are already taking care of this for them. Each month we work with over a thousand new companies, from our experience the vast majority of companies are either not taking these types of tax incentives at all, or they are taking only small fractions of what is available.