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WOTC Tax Credits

Are Today’s Youth HR’s Best Kept Secret?

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Progressive companies seem to have cracked the code of hiring teenage help and leveraging those employees as strategic assets. More specifically 16-17 year olds for seasonal help.

It’s true that there is a certain unflattering stigma associated with teenage employees, but it doesn’t mean that you should overlook this segment of the workforce.  In fact, with an intentional plan you can sift through this unique talent pool and hire the best and take advantage of the benefits they can offer your company.

There are more than a few examples of teenagers behaving badly in their workplace scattered across the internet casting a shadow upon both their employer and fellow teen worker.  This shouldn’t be a deterrent but rather an incentive to perfect your hiring process.

So why should you consider hiring more teens?

  • For starters, they have lower wage requirements than longer tenured employees resulting in lower overall payroll. Not to mention they seldom work enough hours to earn OT and often don’t receive the benefits of full time workers.
  • They can help expand your clientele to a segment of the population you may not have previously reached. Teenagers have dozens of retail options to visit after school, but they gravitate to those where their friends work.
  • You can begin relationships with quality individuals that become lifetime employees.  The landslide majority of Chick-fil-A operators started working for the company during summers in high school.
  • The energy they have is both inspiring and infectious. Teenagers can often be labeled as lazy, but more often than not, it’s just boredom.  Given a task and empowered to achieve it, you’ll be surprised at how creative and efficient they can be at problem solving.
  • As a final bonus, the Federal Government offers you a WOTC tax credit for each 16-17 year old hired during the summer.  This could reduce your tax liability by up to $2,400 per teen hired.

These are just a few reasons to include teenagers in your candidate pool; especially for retail, seasonal help.

Progressive companies, like yours, have realized solid return on investment by carefully hiring teenagers. Teens help businesses diversify their workforce, attract young customers and increase your profitability. That means more bottom line, thanks to reduced payroll costs, sales potential and tax incentives.

If you’d like to learn more about how we can help your business improve your hiring and take advantage of the Work Opportunity Tax Credit (WOTC) program click here and we’ll be in touch shortly.

5-year WOTC Extension Announced

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It’s official! The Work Opportunity Tax Credit (WOTC) program has been renewed for five years (2015 – 2019).  Last week, Congress voted to extend the WOTC program as part of the Tax Extenders legislation, and received the President’s official signature of approval on December 19th.

This renewal is especially exciting as it is the first time in it’s history WOTC has received a 5-year renewal which is a testament to it’s success. Secondly, Congress has added a new target segment for Long Term Unemployed Recipients, which can qualify more of your employees and increasing your potential tax credits.
Here is the actual wording from the bill:

The term ‘qualified long-term unemployment recipient’ means any individual who is certified by the designated local agency as being in a period of unemployment which is not less than 27 consecutive weeks, and includes a period in which the individual was receiving unemployment compensation under State or Federal law.

This is precisely what employers have been waiting on all year.  In a nutshell, the program provides participants tax credits up to $2400-9600 for each qualified, new hire brought on board. This renewal is a solid investment in the American dream and provides work opportunities for millions while providing businesses the capital to expand their businesses that will create even more jobs.

It doesn’t take long to figure out that this program can be a great way for companies to invest in their growth by significantly reducing their tax liability. To learn how much your potential tax savings might be, try our tax savings calculator here.

WOTC Renewal Update

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The Work Opportunity Tax Credit (WOTC) program scored a big victory this week. On 7/21/15, the Senate Finance Committee voted 23-3 to pass a two-year extension of this important program. This means that the bill is now ready for a full Senate vote. Although this is only the first step,  the near-unanimous support for WOTC legislation marks a huge step forward in a program which has awaited renewal since December 2014.

WOTC is an employment incentive to reward businesses who hire from several target groups that historically have faced barriers to employment. The tax credit awards businesses up to $2400-9600 for each eligible new hire. Applications must be received within 28 days to state workforce agencies.

We strongly advocate for this program as it has served American companies well. WOTC has helped businesses save thousands annually in tax liability. Moreover, it expands opportunities for job candidates most in need.

The program has passed one gateway and is en route for a Senate vote. We will keep you posted as new developments take place.

SNAP: A Huge Part of WOTC Tax Credits

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The WOTC program includes many target groups. Among these are SNAP (Supplemental Nutrition Assistance Program) recipients, or persons receiving food stamps. It’s highly likely that you may have hired a SNAP recipient or member of a qualified household. According to USDA statistics, in fiscal year 2014, SNAP recipients represented over $10 billion in available tax credits.

With the volume of SNAP recipients in this country, you’ve probably hired untold numbers which met WOTC qualifications. Did you know that roughly one in seven Americans receives this aid? Since the recession, food stamp recipients grew to over 23 million households. The number of children benefiting from the program has nearly doubled to over 15 million since the 2007 recession. All across the country, rural and urban citizens receive food stamps temporarily and long-term.

Hiring a SNAP beneficiary could earn you up to $2400 in tax credit for each new candidate. Qualified candidates must be between 16-39 years old and not have worked for your company before. 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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