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Incentive Programs for Business

Work Opportunity Tax Credit

Important Notices

The Department of Labor has issued a new ETA Form 9061, dated April 2013. Employers and consultants must begin using the new form by September 12, 2013. Older versions of the 9061 submitted after that date will not be accepted. A link to the new form can be found throughout this website
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The Work Opportunity Tax Credit (WOTC) is a Federal tax credit, and it is designed as an incentive for businesses to hire individuals that consistently face significant barriers to employment. The main objective of this program is to enable the targeted employees to gradually move from economic dependency into self-sufficiency as they earn a steady income and become contributing taxpayers. Participating employers are compensated through a reduced federal income tax liability. WOTC joins other workforce programs that help incentivize workplace diversity and facilitate access to good jobs for American workers.

Eligible Workers

DOL Category

Categories of Eligible Veterans

Qualified First-Year Wages Used To Determine Credit
(Maximum Considered)

Hours Worked in First-Year

>= 400 hrs

120 to 399 hrs

Credit is 40% of Qualified First-Year Wages

Credit is 25% of Qualified First-Year Wages

2Ba

Veterans that received food stamps (Supplemental Nutrition Assistance Program, or SNAP) for 3 consecutive months during the 15 months prior to the hire date.

$6,000

$2,400

$1,500

2Bb

Veterans entitled to compensation for a service-connected disability and discharged from the military during the year prior to the hire date.

$12,000

$4,800

$3,000

2Bc

Veterans entitled to compensation for service-connected disability and unemployed for at least 6 months during the year prior to the hire date.

$24,000

$9,600

$6,000

2Bd

Veterans unemployed for at least 4 weeks, and less than 6 months, during the year prior to the hire date.

$6,000

$2,400

$1,500

2Be

Veterans unemployed for at least 6 months during the year prior to the hire date.

$14,000

$5,600

$3,500











DOL Category

Categories of Eligible Non-Veterans

Qualified First-Year Wages Used To Determine Credit
(Maximum Considered)

Hours Worked in First-Year

>= 400 hrs

120 to 399 hrs

Credit is 40% of Qualified First-Year Wages

Credit is 25% of Qualified First-Year Wages

A

Member of a family that received TANF assistance for 9 of the 18 month period ending on the hire date.

$6,000

$2,400

$1,500

C

Convicted of a felony or released from prison after a felony conviction during the year period ending on the hire date.

$6,000

$2,400

$1,500

D

Designated Community Resident age 18 to 39

$6,000

$2,400

$1,500

E

Referred to an employer by a Vocational Rehabilitation Agency, approved the by the state, while on or after completion of an individual employment plan.

$6,000

$2,400

$1,500

F

Qualified Summer Youth age 16 to 17.

$3,000

$1,200

$750

G

Member of a family that received SNAP (Food Stamps) benefits for at least the 6 months period ending on the hire date, OR received SNAP benefits for the 3 out of the 5  months ending on the hire date and are no longer receiving them. Must be age 18 to 39.

$6,000

$2,400

$1,500

H

Received Supplemental Security Income (SSI) benefits for any month ending within 60 days of the hire date.

$6,000

$2,400

$1,500







Long-Term TANF (Category I) is unique and is noted out of sequence




I

Member of a family that received TANF assistance for at least the 18 month period ending on the hire date,

OR received at least 18 months of assistance beginning after August 5, 1997 with the earliest 18-month period ending within 2 years of the hire date,

OR your TANF eligibility ended within two years of the hire date.

Qualified First-Year Wages Used To Determine Credit
(Maximum Considered)

Hours Worked in First-Year

>= 400 hrs

120 to 399 hrs

Credit is 40% of Qualified First-Year Wages

Credit is 25% of Qualified First-Year Wages (capped at $6,000)

$10,000

$4,000

$1,500




Qualified Second-Year Wages Used To Determine Credit
(Maximum Considered)

Hours not addressed in Second-Year

 


Credit is 50% of Qualified Second-Year Wages


$10,000

$5,000




How to apply
 
To qualify for the tax credit, the employer must apply for and receive an Employer Certification.  To request certification:
  1. Have the potential new hire complete page one of the Pre-Screening Notice (IRS Form 8850) by the day    of job offer. 
  2. If the new employee indicates potential WOTC eligibility on page one of Form 8850, complete page two of this form.
    1. Important: There are four date blocks on page two. The date blocks must show that the applicant provided the information (completed the front side of the form 8850) before or on the day the job is offered. Why? Because the applicant is required to provide information about potential WOTC eligibility before they are offered the job.
  3. Have the new hire complete ETA Form 9061 (Individual Characteristics Form) after they start.
  4. If the new employee is a veteran, please include a copy of their DD 214. If they are a disabled veteran, include a copy of their VA letter showing their VA rating (percentage of disability). If you cannot get these documents right away, please include a note letting us know that you will be sending the document soon.
    1. Why is this important? If you include the DD 214 or VA letter, we will move your application to the front of the line for processing. However, without those additional documents, it will be necessary for you to have the new employ sign a VA Informed Consent Form so we can request the information from the VA – which is a longer process.
  5. Request certification by mailing the completed Pre-Screening Notice and Certification Request for the Work Opportunity Credit, Individual Characteristics Form, and any supporting documents within 28 calendar days after the applicant starts work to:
Oregon Employment Department
WOTC Unit, Room 201
875 Union Street NE
Salem, OR 97311
Important Notes:
•    The timeliness of the request is determined by postmark date.
•    Oregon does not accept electronic submission of forms. All forms must be mailed to the WOTC  Unit.
Please note that the timely filing provision is part of the eligibility criteria for the tax credit.  The timeliness requirement cannot be waived.   Incomplete applications are not accepted.
 
If the request is timely and the applicant is eligible, an Employer Certification will be returned to the business authorizing the tax credit.
 
At the end of the tax year, claim the credit on your WOTC certified employee(s) by completing IRS Form 5884.
 
Filing reminders
Due to the high volume of incoming applications, the WOTC Unit is unable to verify receipt of applications.  Use of certified mail or equivalent is recommended for confirming receipt of any application.

Federally subsidized on-the-job training (OJT) programs and the WOTC
 
For a potential WOTC target group member that is about to begin an On-the-Job Training (OJT) program, mail a completed certification request to the WOTC Unit no later than 28 calendar days after the individual begins the OJT experience.  The OJT start date is treated as the employment start date when determining Employer Certification eligibility.

For specific WOTC information and forms:
 
Link to IRS 8850Link to ETA 9061Link to VA Informed Consent

Contact the Oregon Employment Department at 1-800-237-3710 ext. 71670 for additional information.

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Dependent Care Tax Credit

Oregon is among 20 states in the nation that offer a state tax credit for dependent care assistance provided to employees. Oregon´s tax credit permits an employer to offset 50 percent of its child care expenditures against its state tax liability. The credit allows an annual limit of $2,500 per employee.
 
For more information on the Dependent Care Tax Credit, click here.

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Federal Bonding Program


The Oregon Employment Department participates in the Federal Bonding Program. Employers can receive $5,000 fidelity bonds, free of charge, as an incentive to hire job seekers that do not qualify for commercial fidelity bonds. This program, sponsored by the U.S. Department of Labor, has a 99 percent success rate nationwide, as only one percent of the workers receiving bonds have proved to be dishonest.

What is Federal Bonding?

  • Fidelity insurance through the McLaughlin Company, an agent for Travelers Insurance Company
  • Protects employers against employee theft
The Bond
  • $5,000 coverage for a 6-month period (no deductible)
  • Free of charge to job seeker and employer
  • Covers loss due to theft, forgery, larceny, or embezzlement
  • Does not cover poor workmanship, injuries or accidents

Types of Workers Covered

Job applicants denied (or potentially denied) commercial bonding due to:

  • Arrest, conviction or imprisonment
  • Alcohol or drug abuse
  • Poor credit history
  • No employment history
  • Dishonorable discharge from the military
  • Any other reason that makes the job seeker “Not Bondable”

Requirements for Coverage

  • Firm full or part time job offer with start date (job offer can be contingent on receiving bond)
  • Job must have an employer-employee relationship with federal taxes automatically deducted
  • Program does not cover self-employment or independent contractors

Application Process

  • The bonds will be processed by Oregon’s Federal Bonding Coordinator, an employee of the Oregon Employment Department
  • Bonds can be requested by the job seeker, employer or a third party, e.g., job coach
  • Once the job seeker receives a firm job offer, contact the Bonding Coordinator
  • The Bonding Coordinator will ask for some basic information about the job seeker, employer and job
  • If requirements are met, the Bonding Coordinator will complete the Fidelity Bond Certification Form and mail it to the McLaughlin Company
  • The Bonding Coordinator will also send a confirmation letter to employer
  • The bond is effective the day the job seeker starts work (The start date is entered on both the certification form and the employer confirmation letter)
  • The McLaughlin Company will mail the actual Bond Certificate to the employer within 15 working days
  • Neither the employer nor job seeker need to fill out any paperwork
  • If the employee completes the initial six months of free bonding without issue, the employer may purchase a bond for the employee at Travelers’ commercial rate

For More Information on the Federal Bonding Program, Please Contact:

Doug Barrett (Oregon’s Federal Bonding Coordinator)
503 947-1680
Douglas.D.Barrett@state.or.us

Also, more information is available at the Federal Bonding web site: http://www.bonds4jobs.com/


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