Work Opportunity Tax Credit

The Work Opportunity Tax Credit (WOTC) is a federal tax credit. It gives employers up to $9,600 for hiring people from certain groups.

Employers can get the WOTC by hiring people from these nine groups:

• Temporary Assistance to Needy Families (TANF) recipients

• Qualified veterans:

  • Veterans getting Supplemental Nutrition Assistance Program (SNAP) benefits
  • Veterans unemployed for four weeks to six months
  • Service-related disabled veterans discharged within a year
  • Veterans unemployed for six months to a year
  • Disabled veterans unemployed for a long time

• Ex-felons hired within a year after release or conviction

• Designated Community Residents ages 18-39 living in areas an Empowerment Zone, Renewal Community or Rural Renewal Community

• Vocational rehabilitation referrals: people with mental or physical disabilities

• Qualified summer youth ages 16-17 living in areas an Empowerment Zone, Renewal Community or Rural Renewal Community

• Qualified SNAP recipients: ages 18-39

• Supplemental Security Income (SSI) recipients

• Long-Term Family Assistance (LTFA) recipients

Employers can claim the WOTC for the first 12 months of employment. This can cover two tax years for LTFA-WOTC. Any unused portion of the credit can be carried back one year or forward on future tax returns for 20 years or until all the credit is used, whichever occurs first.