CMS’s resident tax credit expert Brian Kelly recently took to the airwaves in Philadelphia on WWDB-AM Talk 860’s the Philly Business Spotlight Hour to spread the word about the Work Opportunity Tax Credit. WOTC is a program that helps disadvantaged US citizens to gain employment, and at the same time it helps businesses to reduce their tax burden by hiring them.
He told host Brian Dougherty “We got into the Work Opportunity Tax Credit business because most employers, or more businesses don’t even know it exists. So the more I talked to people, about the program, the more we realized, we have to educate people first on it, and then once they understand it they can see the value.”
CMS has over 20 years of experience working with companies to take advantage of these little known federal WOTC tax credits. We find ourselves going beyond just filing for tax credits, and start looking at the economy, the bigger picture, the legislative trends, and the characteristics of the WOTC tax credit program. Some of the numbers that we have come to realize is that statistically roughly 15% of all new hires will qualify for the employer to receive a federal WOTC tax credit. (Calculate your savings)
Most employees who are eligible, will not actually be aware of that themselves unless they go through an employment service. Whether they received SNAP benefits, were unemployed for over 26 weeks, are a veteran or fall into another qualifying WOTC category, we determine eligibility by using the IRS Pre-Screening Notice and Certification Request for the Work Opportunity Credit 8850 and Department of Labor Individual Characteristics (ICF) 9061 forms. CMS screens new hires for eligibility, and tracks the value of the credits to obtain the maximum for the employer.
In August of 2018 we are at the lowest unemployment rate in over 30 years of 3.9% (source BLS). However, what’s interesting is we still have between 40 – 44 million people receiving state & federal assistance (SNAP – Food stamps & TANF). As we tie that number back and compare to our WOTC processing qualification rates that represents about 75% of all the qualified tax credits we obtain for employers across the country.
Recently proposed legislation under the Farm Bill Act & Welfare Act is to enact work requirements for Supplemental Nutrition Assistance Program (SNAP) Recipients, even if it’s only 20 hours per week, to get people into the workforce (without losing their assistance).
“This will truly help grow the economy,” said Brian.
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