The Work Opportunity Tax Credit (WOTC) is available for employers that hire individuals who are members of targeted groups. Before an employer may claim the WOTC, the employer must obtain certification that the hired individual is a targeted group member. Certification of an individual’s targeted group status is obtained from a designated local agency (DLA). A DLA is a state employment security agency. An employer must submit federal Form 8850 to the DLA not later than the 28th day after the individual begins work for the employer. Due to the retroactive extension of the WOTC for 2014 (see Payroll Management Guide Report Letter 2386, dated December 30, 2014), an employer that hired a member of a targeted group or a qualified tax-exempt organization that hired a qualified veteran, on or after January 1, 2014, and before January 1, 2015, will be considered to have satisfied the requirements of the law if it submits the completed Form 8850 to the appropriate DLA to request certification not later than April 30, 2015. (IRS Notice 2015-13, IRB 2015-10, March 9, 2015.)
For more information on this and other topics, consult the Visit our News Library.