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April 2015

TANF: A primary component of WOTC tax credits

tanf

The WOTC program includes many target groups. Among these are TANF (Temporary Assistance for Needy Families) recipients, or qualifying persons receiving financial assistance. It’s highly likely that you may have hired a TANF beneficiary and not have known it. According to USDA statistics, in fiscal year 2014, SNAP recipients represented over $3 billion in available tax credits.

With the volume of TANF recipients in this country, you’ve probably hired untold numbers which met WOTC qualifications. Did you know that during the 2014 calendar year that nearly 36 million Americans received this aid? Since the 2007 recession, the number of families that have qualified for this financial assistance grew by 50%.

TANF is a financial assistance program for low income families that have children and for pregnant women in their last three months of pregnancy. The program provides temporary financial assistance while at the same time helps TANF recipients find jobs that will allow them to support themselves.

Hiring a TANF recipient could earn you up to $2,000 in tax credit for each new candidate. There are different qualifications for Long-Term and Short-Term recipients.

Long-Term Temporary Assistance for Needy Families (TANF) Recipient
To qualify for this target group, a new hire must be a member of a family that meets one of the following circumstances:

  • Has received TANF benefits for at least 18 consecutive months ending on the hiring date; OR
  • Has received TANF benefits for at least 18 consecutive or non-consecutive months after August 5, 1997, AND has a hiring date that is not more than 2 years after the end of the earliest 18-month period after August 5, 1997; OR
  • Has stopped being eligible for TANF payments during the past 2 years, because a Federal or state law limited the maximum time those payments could be made.

Short-Term TANF Recipient
A new hire qualifies for this target group, if the individual is a member of a family that received TANF benefits for any 9-month period during the 18-month period ending on the hiring date.

 

It’s important to note that State workforce departments must receive requests within 28 days of new hires’ start dates.

The great news is these people are easier to identify than you thought possible. By taking advantage of these, and making minor tweaks in your hiring process, you could save thousands in tax dollars. Give us a call at 563-583-2115 to learn how to get started or you can find out how much you have been missing in tax savings by using our free calculator HERE.

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