Tax credits and WOTC
The Work Opportunity Tax Credits Program rewards employers for hiring applicants who fall into ten targeted demographic groups:
• Five Veteran Target Groups: up to $9,600
• TANF (Welfare) Recipients: up to $9,000
• SNAP (Food Stamps) Recipient: up to $2,400
• Long Term Unemployed and Residents of Empowerment Zones: up to $2,400
• Vocational Rehab Referral: up to $2,400
• Ex-Felon: up to $2,400
• SSI/SSDI Recipient: up to $2,400
The stimulus bill signed on December 27, 2020 has extended this credit through December 31, 2025.
Application Deadline
Employers have 28 day from an employee’s start date to submit an application to the employer’s state workforce agency.
Disaster Credits
2017 Disaster Employee Retention Credit
The Disaster Tax Relief and Airport and Airway Extension Act of 2017 encourages businesses that were disrupted by Hurricanes Harvey, Irma, and Maria to retain employees while their businesses recover. The 2017 California Wildfires were added to this credit by the Bipartisan Budget Act of 2018 on February 9, 2018. This tax credit of up to $2,400 per retained employee is eligible for up to 5 disasters affecting 6 states and territories: CA, FL, GA, PR, TX, and VI.
2018-2019 Disaster Employee Retention Credit
The Future Appropriations Act of 2020 adds 29 2018-2019 disasters in 21 states and territories to this credit. This includes earthquakes, tornadoes, hurricanes, wildfires, and other disasters in AL, AK, AR, CA, FL, GA, HI, IN, MS, MO, NE, NC, OH, OK, SC, SD, TX, WI, American Samoa, and Northern Mariana Islands.
A tax credit of up to $2,400 per retained employee is available for eligible businesses with a principal address or worksite location in one of the affected disaster counties, was impacted adversely by the disaster, and retained employees during the impact period and within 150 days from end date of disaster impact date.
2020 Disaster Employee Retention Credit
The Consolidated Appropriations Act of 2021 adds 42 disasters in 23 states, territories, and tribal communities to this credit. This includes earthquakes, tornadoes, hurricanes, wildfires, and other disasters in AL, AR, CA, DE, FL, HI, IA, KY, LA, MI, MO, MS, NC, ND, NJ, NY, OR, PR, SC, TN, TX, VT, WA, and WI.
A tax credit of up to $2,400 per retained employee is available for eligible businesses are those with a principal address or worksite location in one of the affected disaster counties, was impacted adversely by the disaster, and retained employees during the impact period and within 150 days from end date of disaster incident ending date.
To find out if HRD Markets can help you identify whether or not you or your clients are missing potential tax savings, get appointed with us today!
Visit www.irs.gov for more up to date information on available tax credits.