| Incentive Programs for Business |
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| Work Opportunity Tax Credit |
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Important Notice
WOTC program eligibility and rules are enacted by Congress, and details for 2012 are not finalized. As of January 2012, this is the program status:
- All veteran provisions are active, including those recently amended.
- Qualified “tax-exempt” (i.e., 501(c)) organizations can now participate by hiring qualified veterans.
- The Non-Veterans provisions of the program sunset on December 31, 2011, but we expect Congress to reauthorize the program with retroactive provisions.
- Oregon will continue accepting all WOTC applications during the program hiatus.
- Once the law is reauthorized we will finish the final stages of application processing for Non-Veterans hired after December 31, 2011.
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The Work Opportunity Tax Credit (WOTC) is a Federal tax credit incentive that the Congress provides to private-sector businesses for hiring individuals from nine target groups who have consistently faced 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, while the participating employers are compensated by being able to reduce their federal income tax liability. WOTC joins other workforce programs that help incentivize workplace diversity and facilitate access to good jobs for American workers.
How to apply
To qualify for the tax credit, the employer must apply for and receive an Employer Certification. To request certification:
- Have the potential new hire complete page one of the Pre-Screening Notice (IRS Form 8850) by the day of job offer.
- If the new employee indicates potential WOTC eligibility on page one of Form 8850, complete page two of this form.
- Request certification by completing the ETA-9061 form and mailing it with a completed 8850 to the Oregon Employment Department WOTC Unit no later than the 28th calendar day after the employee begins working for you.
Mail these forms within 28 calendar days after the applicant starts work to:
Oregon Employment Department
WOTC Unit, Room 201
875 Union Street NE
Salem, OR 97311
The timeliness of the request is determined by postmark date.
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
- Form 8850 must be complete with signatures appearing in ink or pencil
- An untimely application will result in the denial of the certification request
- Keep copies of the documents mailed and the determination letter received
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:
Visit the U.S. Department of Labor, Work Opportunity Tax Credit Web site:
http://www.doleta.gov/business/Incentives/opptax
Contact the Oregon Employment Department at 1-800-237-3710 ext. 71478, or your nearest Employment Department field office for copies of the IRS Form 8850.
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| Dependent Care Tax Credit |
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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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