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Work Opportunity Tax Credit and On-Boarding

By Lawrence L. Bell

With the cost of doing business consistently on the rise combined with the increasing difficulty to find/retain great employees, there is no better time to pursue employment-based tax credits. There are both federal and state employment-based credits available that can help businesses offset income tax liability.

Some of these programs are based on the creation of net new jobs, while others are offered to employers for employing individuals from specific target groups, such as the Opportunity Tax Credit. The tax credit can range from a maximum of $1,200 to $9,600 for each qualified new hire depending upon the new hire's target category and there are currently 14 different target categories under which an employee may qualify. Many states also have targeted employment credits with similar qualification criteria as the WOTC that are commonly referred to as “WOTC piggy-back credits.”

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