Let’s Us Know! How Do You Handle Delayed WOTC Certifications?

Hello friends and readers, this is Vaughn Hromiko, here.  This post is meant as a question to employers and agents . . . and anyone involved with the Work Opportunity Tax Credit program.  I would love to hear from you.

The Question:  How do you (or your CPA, or your company, or others you have observed), handle the claiming of Work Opportunity Tax Credits for employees whose WOTC certifications are delayed until after the tax-return filing deadline?

Perhaps you would:

  • Lump the employee’s credit into the following tax year?
  • Claim the tax credit by amending the employer’s return?
  • Something else?

You can post a response in the comments or you are welcome to respond privately by email to response@WOTCPlanet.com.  I won’t share identifying information about anyone who responds privately.

Background. This problem is destined to be more significant than ever for WOTC employees hired in 2015. State workforce agencies nationwide are experiencing extended delays in issuing Work Opportunity Tax Credit (WOTC) certifications for 2015 hires. This problem stems from Congress’ long delay in passing legislation to reauthorize WOTC after it expired in 2014.

The reauthorization bill, which was finally passed on December 18, 2015 also created a new WOTC Target Group, the “Long Term Unemployment Recipient”.  While this program expansion was welcomed, it placed new demands on state workforce agencies. They now have to update their procedures, databases and management software to handle the new eligibility criteria.

As soon as the bill passed, agencies knew this work would be required.  However, before any substantial planning or development could happen, they would need updated forms and specific guidance from both the IRS and Department of Labor.

The IRS issued an updated Form 8850 at the end of March, 2016. The updated ETA Form 9061 and related guidance were then finally issued on June 17, 2016.  It was only then, with all requirements finally defined, that agencies could make substantial headway in updating their systems.

Given the uncertainties created by this elongated series of updates, the IRS has given employers until September 28, 2016 to submit WOTC applications for their 2015 hires.  As of this late date in August, many agencies are still working to update their information systems and can not yet process the new WOTC target group.

Lay this schedule over the basic tax-return requirements for companies on a calendar-year filing schedule. Original tax-return filing dates passed months ago in March and April. Businesses and individuals that have requested a filing extension from the IRS will hit their final deadlines in mid-September and October.

Many WOTC certifications for 2015 hires will still be pending, even at that late date.

Work Opportunity Tax Credit Informational Notice – Updated Forms Requeired

The Department of Labor has issued Training and Employment Guidance Letter Number 9-15 regarding updated forms. This morning, we received a notice about the update from the Karen Marberry, Minnesota’s Work Opportunity Tax Credit Coordinator. Marberry’s notice is copied below.

Please notice, the ETA 9061 has been renewed without substantive change BUT the Revision Date and Expiration Date have been updated.  Effective February 16, 2016 the new revision of the form must be used and the old revision will no longer be accepted.

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Work Opportunity Tax Credit

Informational Notice

Dear Consultant:

We have been advised by the U.S. Department of Labor to notify employers and consultants participating in the Work Opportunity Tax Credit program the required use of the newly revised ETA Form 9061 (August 2015) for all new hires effective February 16, 2016 and later. We ask that you discontinue using any outdated forms you currently have.

The 8850 and 9061 forms are available on our website at

http://mn.gov/deed/wotc under the tab “How to Apply”. The website lists all of the target groups covered by the tax credit for individuals hired before January 1, 2015.

The WOTC is currently in a program hiatus; however please continue to submit applications timely throughout the hiatus to ensure applications will not be denied for being late once the program has been reauthorized.

This form change requirement includes applications submitted to the WOTC online application system.

Thank you for your cooperation. If you have any questions, please call 651-259-7507 or 1-888-234-5521.

Karen Marberry | Work Opportunity Tax Credit Coordinator
Department of Employment and Economic Development
1st National Bank Building, 332 Minnesota St., Suite E200, St. Paul MN 55101
Direct: 651-259-7521 l TTY: 651-296-3900 l Fax: 651-297-7722
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