ADP System Helps Employers Track New Work Opportunity Tax Credit

Following President Obama signing both the Omnibus Spending Bill H.R. 2029 and the PATH Act (Protecting Americans from Tax Hikes Act of 2015) into law last Friday, which provides a five-year extension of the Work Opportunity Tax Credit (WOTC) Program, ADP announced its WOTC solution will help screen for a newly added category.

WOTC is a tax incentive program designed to encourage employers to hire and retain individuals from specific target groups with employment barriers.  These groups include Veterans of War (VOW), Empowerment Zone residents, welfare and food stamp recipients, and others.  New to WOTC is the “long-term unemployed” category.  Long-term unemployed recipients are defined as individuals who are unemployed for not less than 27 consecutive weeks and received unemployment compensation for a period of time under State or Federal law.  This new category is effective for employees who start work after December 31, 2015.

“Managing the Work Opportunity Tax Credit Program can be complicated,” said Jeanne Madden, vice president of operations in the Tax Credits Division of ADP Added Value Services.  “The real-time aspect of our WOTC program helps businesses spot challenges and take action.  What many businesses don’t know is that they can qualify for a tax credit of up to $9,600 per eligible employee during the first year of employment through this program.”