Most human resources departments use a checklist when hiring new employees. Such lists are critically important, whether they are printed on paper or managed electronically by a paperless onboarding system. Lists help us to consistently and fairly walk new workers through a litany of important tasks.
Compare the Items on Your List:
I gleaned the following items from one such checklist published by SHRM.
- Completed job application
- Authorizations for background check and drug screening
- Form I-9
- Federal & state tax withholding forms
- Company policy acknowledgement forms
- Emergency contact form
- Benefits information and enrollment forms
- Filing and data entry
I’m sure this looks familiar to most readers. Tens of thousands of successful HR departments follow a similar checklist every day.
But what’s missing?
There is something missing.
And it’s costing employers millions every year.
Have you figured it out?
It’s the Work Opportunity Tax Credit (or WOTC).
Adding WOTC screening forms to your hiring checklist is one of the simplest and easiest ways to reduce your company’s federal income tax. To qualify, otherwise eligible employees must provide information on (or before) the day of their job offer.
This simple task helps employers earn thousands of dollars in tax reductions per eligible hire. Most already hire eligible workers and could hire even more with targeted recruiting. (For example, intentionally reaching out to hire unemployed veterans.)
Depending on why they qualify, employers can earn between $2,400 and $9,600 in tax credit for each qualified employee. Since most employers (without knowing) already hire eligible workers, a hiring checklist without WOTC means lost tax benefits.
Businesses that add WOTC to their hiring checklist keep more money at tax time.