President Barack Obama has signed into law the Tax Increase Prevention Act of 2014, which extends the Work Opportunity Tax Credit (WOTC) until New Year’s Eve. Employers have processed their employees for WOTC, not knowing if the potential credit would be renewed, but the recent extension assures their diligent efforts were not wasted; however, we are quickly approaching a deadline that is now just a day away.
The tax-credit extension to close out 2014 was passed by a majority vote. While 58 strongly conservative Republicans voted against the bill, 38 Democrats in combination with 181 Republicans secured the bill’s future. The Senate had no choice but to pass the tax-extender bill with a one-year extension of WOTC and VOW to Hire Heroes Act veterans’ tax credits for 2014.
An extension for the entire year in 2015 has not been confirmed, but progress is being made in order to get WOTC included on the bill to raise the debt ceiling. According to The WOTC Planet, “When Congress convenes again in 2015 it will be with new leadership, with new directives controlled by a new Republican majority in both houses. Big changes to the tax code have been promised.”
WOTC is the most cost-effective job-creation program and serious discussion has taken place to make the tax credit permanent along with several other credits extended in this bill.
Regardless of the impending hiatus, it is important that you are taking advantage of it, as each year, employers claim more than $1 billion in tax credits under the WOTC program.
To ensure your tax credit strategy is effective, partner with a provider that offers a true single-application solution. With this technology, businesses can capture WOTC credits, while also mitigating compliance risks.
