Tax Credit Consulting: Work Opportunity Tax Credit Buckhannon WV
Horizon Financial Group
Education: Ohio University, BBA FinanceCollege for Financial Planning's CFP Certification Professional Education Program
Years of Experience: 15
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Vealey Financial Services
Years of Experience: 43
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Charles Town, WV
Tax Credit Consulting: Work Opportunity Tax Credit
Work Opportunity Tax Credit
The Work Opportunity Tax Credit was extended to 2011 and provides tax credits to employers to encourage them to hire employees from targeted groups.
Work Opportunity Tax Credit
Tax credits are often used to encourage activities that are considered beneficial to the society. The credits become political issues that reflect the goals of the Government as well as providing relief to deserving taxpayers. The Work Opportunity Tax Credit is a good example of this type of Tax Credit. The credit was started in 1996 and has been extended by Congress and will remain in force until 2011. The Work Opportunity Tax Credit, often known as WOTC, encourages employers to hire workers that might otherwise find it hard to find employment.
The employees are called targeted employees. The groups of targeted employees include such groups as ex-felons and people receiving Food Stamps or other forms of Welfare. Other targeted groups were veterans on Food Stamps and members of families receiving various forms of public assistance. The program was politically motivated by the idea of moving more people from the welfare rolls to the workforce. This issue was very popular in the mid 1990's when the credit was begun and remains a hot political issue today.
In its original form the Work Opportunity Tax Credit was a set amount that could be claimed by the employer when he hired an eligible employee during the tax period. The new version allows a percentage of the employees earning to be claimed rather than a set amount. There are certain restrictions in place also. The employees can not be former employees in any way or manner. This is regardless of how long ago the employee had been employed or for how long. Family members of business owners were ineligible as well.
The program has received a great deal of support from the employment services of the various States. Many States pass out information to potential employers informing them of the credit, e...