The deadline to file the necessary form to claim the Work Opportunity Tax Credit (WOTC) for calendar year 2015 has been extended to June 29, 2016. In December 2015, the WOTC was retroactively renewed by the Protecting Americans from Tax Hikes Act of 2015 for employees hired through December 31, 2019.
This retroactive renewal allows employers to file for the credit for all employees in targeted groups for the 2015 tax year. To claim the WOTC, employers must file Form 8850, Pre-Screening Notice and Certification, within 28 days of the employee’s first day of work. The retroactive extension of the WOTC and updated deadline allows employers to file the necessary Form 8850 for employees hired January 1, 2015 through May 31, 2016 by June 29, 2016.
Another notable update from the Protecting Americans from Tax Hikes Act of 2015 was the expansion of the targeted group of employees to include those who have received qualified long-term unemployment.
The extension of the deadline should allow companies the time needed to claim the credit. Any company hiring individuals through December 31, 2019 should consider their eligibility to claim the credit.
As a reminder, qualifying tax-exempt entities under Code Section 501(c) and 501(a) may be able to claim a reduced WOTC against their share of social security tax. To read more about the reduced WOTC available to tax-exempt entities, please visit our previous blog on the subject here.
If you have any questions as to how this may impact your or your company, reach out to us online by clicking here, or call 513-241-8313 to speak with a member of our tax team.