Payroll & Tax

Work Opportunity Tax Credit Screening

AllianceHCM has helped clients claim over $25 Million in Work Opportunity Tax Credits (WOTC). Offset your corporate income tax and get cash back.

The Work Opportunity Tax Credit (WOTC) is a federal tax credit available to employers who invest in American job seekers who have consistently faced barriers to employment.

Employers may meet their business needs and claim a tax credit if they hire an individual who is in a WOTC targeted group.

The credit available ranges from $2,400 up to $9,600,
depending on the targeted group and qualified wages
paid to the new employee generally during the first
year of employment.

Generally, the credit is 40% of qualified first-year wages for individuals who work 400+ hours in their first year of employment.

Find Out if you Qualify

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AllianceHCM is the payroll provider of {company}. Please contact your employer (even if you're not employed there anymore) directly for assistance with logging in, resetting your password, questions about your paystub, accessing your W2, benefits or any direct deposit questions etc. We have strict security rules in place and cannot access or share employee information with anyone other than your employer's AllianceHCM administrator.

What are you most interested in learning?

The importance of using your payroll provider for onboarding, WOTC, and ACA.

Compliance issues arise when employee data doesn’t transfer appropriately from an outside service into your payroll system.

FAQs About WOTC

How do I know if my new hire is part of a targeted group?

WOTC Screening is used to determine if a new hire is a member of one of the Work Opportunity Tax Credit’s 10 target groups that would make the employer eligible to receive a tax credit for hiring the individual:

Qualified IV-A recipient
Qualified veteran
Ex-felon
Designated Community Resident (DCR)
Vocational rehabilitation referral
Summer youth employee
Supplemental Nutrition Assistance Program (SNAP) recipient
Supplemental Security Income (SSI) recipient
Long-term family assistance recipient
Qualified long-term unemployment recipient

AllianceHCM uses a proprietary screening process that is 100% confidential, ensuring your employees data is kept secure and only used for tax credit purposes. Employees electronically answer a series of screening questions that are then submitted to the appropriate state agencies for official certification. Sometimes employees may not even be aware of their own eligibility.

For which tax years can the credit be applied?

Employers may claim the Work Opportunity Tax Credit in the year that they receive the tax credit certification. In some cases, the credits are good for up to two years, however most cases the credits are valid only for one year.

Are the credits available every year?

The WOTC is only good for the first year of employment but, available with every new hire. There are also a specific subset of credits employees are eligible to claim every year. Fill out the form below to determine if your organization is one of those groups.

How long must the individual remain on the job to provide the employer with a tax credit?

400 hours for a 40 percent tax credit, at least 120 hours but less than 400 hours for a 25 percent tax credit.

What if I don’t pay regular taxes and only pay AMT, am I eligible for WOTC?

Tax laws were recently updated and WOTC can now be applied to Alternative Minimum Taxes (AMT).

What is a 8850 form?

Employers use form 8850 to pre-screen and to make a written request to the state in which their business is located (where the employee works) to certify an individual as a member of a targeted group for purposes of qualifying for the work opportunity credit.

It is highly recommended businesses leverage AllianceHCM all-in-one solution that has WOTC eligibility requirements built in. This takes much of the guesswork out of the process of determining whether an employee is eligible for WOTC, collecting the required details, and maintaining privacy and compliance. Fill out the form below to get started!

What is the process for applying for WOTC?

The first step is pre-screening to determine eligibility. Fill out the form below to get started. AllianceHCM is an expert when it comes to payroll and tax services. Last year alone, we helped our clients claim over $25 million in WOTC credits. Be the next!

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Alliance has been my go-to platform for every company I’ve worked for. I recommend them to anyone looking for an HRIS platform for any need. Their customer service and products far surpass all competitors.

Alliance has made our payroll processing so easy! As an HR Department of 1, they have really been able to consolidate a lot of processes to make my job much easier.

The transition to Alliance was (fairly) pain-free thanks to the help of the transition team. When you use Alliance, you are given your personal account representative to help with any and all issues.

The team is extremely knowledgeable & are awesome in helping meet all our payroll needs. Highly recommended not only because of support but their payroll program is super user friendly and sophisticated.

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Alliance is the best payroll company in my 40 year accounting career I've ever worked with. They are quick to respond and always pleasant.

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