Work Opportunity Tax Credit

The Work Opportunity Tax Credit (WOTC) is a federal tax credit that offers an incentive for private sector businesses to hire individuals from 12 targeted groups that have consistently faced significant barriers to employment.  

By participating in the WOTC program, employers:

• Can reduce their federal tax liability by as much as $4,800 on new hires
• Make the hiring decision
• Complete minimal paperwork to claim the tax credit
• Can hire as many new qualifying individuals as they choose

Targeted groups include:

• Qualified I-VA recipient [Title IV, part A, Social Security Act relating to Temporary Assistance for Needy Families (TANF)]
• Qualified veteran
• Qualified ex-felon
• Designated community resident (empowerment zone, renewal community or rural renewal community)
• Vocational rehabilitation referral
• Qualified summer youth (empowerment zone or renewal community)
• Qualified food stamps recipient
• Qualified Supplemental Security Income (SSI) recipient
• Qualified long-term Temporary Assistance for Needy Families (TANF) recipient
• Hurricane Katrina employee
• Unemployed veteran
• Disconnected youth

Please refer to the Instructions for Form 8850 (Pre-screening Notice and Certification Request for the Work Opportunity Credit - Rev. August 2009) for group definitions

How employers apply:

There are two forms employers must complete for each new hire.

• IRS Form 8850 (Pre-screening Notice and Certification Request for the Work Opportunity Credit - Rev. August 2009) - must be submitted with original signatures and dates
• ETA Form 9061 (Individual Characteristics Form)

Timely filing is imperative! IRS Form 8850 along with ETA Form 9061 must be submitted to the State Workforce Agency (Maine CareerCenter) no later than the 28th calendar day following the new employee's employment start date. (When the 28th calendar day lands on a Saturday, Sunday or holiday, the next succeeding business day will be treated as the last day of the period.)

Learn more:

To find out more about the Work Opportunity Tax Credit, visit the U.S. Department of Labor Web site or contact your local CareerCenter.

To speak with the Maine Department of Labor WOTC coordinator, call 207-623-7981, TTY: 1-800-794-1110.