What’s New?

Seriously, I’m asking you.  What’s new in your WOTC world?

We would love to hear about your work adventures, your plans, your challenges.

There’s not much news right now about WOTC on the national front. We know there are some suggestions floating around for program expansion.  And every once in while, a feel-good story or a local workshop pops up in a headline or a press release.

Are you working in a state workforce agency somewhere in our great nation? I know some of the agencies are facing challenges with updating their technology. It happens every time Congress changes or expands the WOTC program’s eligibility requirements.

Are you working in a state that is suffering from an extended backlog of WOTC applications? I’m not offering criticism. We all have our challenges. What do you need? What do you wish you had? What would make it better?

How about veterans? Is anyone expanding their domain in a way that might help more veterans use the WOTC program to get jobs?  We’ve seen how difficult it is, perhaps it’s impossible, to change the world on a large scale. So many variables, so much money, bureaucracies, disconnected organizations and systems. Yet, a few dedicated people could make a meaningful difference locally for military veterans in their own community.

Tells us.  What’s new with you?

White House Budget Proposes Permanent WOTC Tax Credit Program

Last summer, the House Subcommittee on Select Revenue Measures held hearings to explore HOW to evaluate the numerous tax extenders coming before Congress each year.  Chairman of the Subcommittee, Congressman Pat Tiberi (R-OH) explained at the time:

“[We] need to consider carefully the principles that we should use to evaluate the merits of these policies. Having recently heard from our House colleagues about their views on many of these extenders, it is time for the Subcommittee Members to roll up their sleeves and see how the provisions stack up against what experts consider the principles of sound tax policy.”

Ultimately, some programs should be made permanent while those not worthy of permanence should be eliminated altogether.

A loose consensus has existed among observers that the Work Opportunity Tax Credit (WOTC) program would be a strong candidate for permanence.   The Obama Administrative this week has cast its vote on that issue.

On page 33 of the Fiscal Year 2014 Budget of the U.S. Government we find this little jewel.  (Thank you to Paul Suplizio, President of the WOTC Coalition, who pointed this out in a coalition email early this week.)

The Administration also continues its support of tax credits that will help employ veterans. The Returning Heroes Tax Credit, which provides up to $5,600 to employers, and the Wounded Warrior Tax Credit, which provides up to $9,600 to hire long-term unemployed veterans with service-connected disabilities, were recently extended for one more year in the American Taxpayer Relief Act of 2012. These credits are a part of the Work Opportunity Tax Credit (WOTC), which contains other categories targeted to hiring veterans. The Budget proposes to permanently extend the WOTC.

FYI, the WOTC program is not directly mentioned again anywhere within the 244 page budget document.

Great News! Question Resolved: IRS Notice 2013-14 is Fully Retroactive

Carmen Ortiz, the United States’ National WOTC Coordinator (U.S. Department of Labor, Employment & Training Administration) issued a correspondence to all of the program’s Regional Coordinators. The purpose of the correspondence was to answer the question many have been asking about IRS Notice 2013-14.

Does the notice in essence wave the “on or before the day of hire” requirements created by §51(d)(13)(A)(ii). Short answer: YES!

In her email correspondence, Ms. Ortiz states that while she is the author of the response to this question, she first ran her response before the IRS.

Now I quote Ms. Ortiz, National WOTC Coordinator:

“The transition relief would permit an employer to go back and have a targeted group member employee hired within the relevant timeframe fill out a Form 8850 and submit it by April 29, 2013.”

And again, in other words:

“An employer can go back and if the new hire was employed within the relevant timeframe, the employer/employee can fill out a Form 8850, signed and dated and submit it to a SWA requesting certification by April 29, 2013.”

So, to summarize.

Notice 2013-14 waves the 28-day deadline for submitting IRS Form 8850 (the WOTC Pre-screen Notice) for qualifying employees hired within certain dates ranges in 2012 and early 2013. The extended deadline for submitting the applications for affected employees is now April 29, 2013. If a Form 8850 was not previously completed by the employee, the form may be completed at this time.

The rules apply as follows:

  • For all targeted groups except qualifying veterans, the extension applies to qualifying employees hired from January 1, 2012 through March 31, 2013 (that’s a period of 15 months).
  • For qualifying veterans, the extension applies to qualifying employees hired between January 1, 2013 through March 31, 2013 (a period of just 3 months)

 

Excerpted from Notice 2013-14

Targeted Groups other than Veterans:

A taxable employer that hires a member of a targeted group (as defined in § 51(d)(2) through (10), other than a qualified veteran described in § 51(d)(3)) on or after January 1, 2012, and on or before March 31, 2013, will be considered to have satisfied the requirements of § 51(d)(13)(A)(ii) if it submits the completed Form 8850 to the DLA to request certification not later than April 29, 2013.

Qualifying Veterans:

An employer that hires any qualified veteran described in § 51(d)(3) on or after January 1, 2013, and on or before March 31, 2013, will be considered to have satisfied the requirements of § 51(d)(13)(A)(ii) if it submits the completed Form 8850 to the DLA to request certification not later than April 29, 2013.

Thank you to John Sandusky, Partner at the Tax Incentive Group, LLC for forwarding this information to me at The WOTCPlanet.com.

Opportunity Alert! IRS Notice 2013-14 Providing Transition Relief for Employers Submitting Late WOTC Applications

The IRS has released IRS Notice 2013-14, which provides transition relief given the late retroactive renewal of the Work Opportunity Tax Credit program in January. The transition rules are not the same, however, for all WOTC target groups.

Notice 2013-14 waves the 28-day deadline for submitting IRS Form 8850 (the WOTC Pre-screen Notice) for qualifying employees hired within certain dates ranges in 2012 and early 2013. The extended deadline for submitting the applications for affected employees is now April 29, 2013.

The rules apply as follows:

  • For all targeted groups except qualifying veterans, the extension applies to qualifying employees hired from January 1, 2012 through March 31, 2013 (that’s a period of 15 months).
  • For qualifying veterans, the extension applies to qualifying employees hired between January 1, 2013 through March 31, 2013 (a period of just 3 months)

 

Excerpted from Notice 2013-14

 Targeted Groups other than Veterans:

A taxable employer that hires a member of a targeted group (as defined in § 51(d)(2) through (10), other than a qualified veteran described in § 51(d)(3)) on or after January 1, 2012, and on or before March 31, 2013, will be considered to have satisfied the requirements of § 51(d)(13)(A)(ii) if it submits the completed Form 8850 to the DLA to request certification not later than April 29, 2013.

Qualifying Veterans:

An employer that hires any qualified veteran described in § 51(d)(3) on or after January 1, 2013, and on or before March 31, 2013, will be considered to have satisfied the requirements of § 51(d)(13)(A)(ii) if it submits the completed Form 8850 to the DLA to request certification not later than April 29, 2013.

Here a link to the entire Notice 2013-14.

Senate Passes Fiscal Cliff Bill – WOTC, Empowerment Zones and Indian Employment Credit Included

US Senators worked late into the wee hours tonight. Sometime after 2:00 AM Eastern, they finally passed the Senate’s compromise bill to avert the fiscal cliff. They are calling it the “American Taxpayer Relief Act of 2012.”  Read about it on CNN Politics.

The bill now faces an uncertain response from the House of Representatives.

Now that my kids are in bed and the new years eve celebration is over, I took a few minutes to review the bill as passed by the Senate.

For starters, it does include very simple extensions of WOTC, Empowerment Zones, and the Indian Employment Credit.  By simple, I mean it simply replaces the expiration dates in the existing legislation — and thus extends the programs retroactively from January 1, 2012 through December 31, 2013.

The bill also includes a renewal of the research and development credit with some modifications.

What I did NOT find was any mention of the now expired VOW to Hire Heroes legislation.  Nor did I find any mention of disconnected youth. So, if my quick read of the legislation is accurate, these former elements of the Work Opportunity Tax Credit program will need to be address separately after the legislative smoke clears and some of the dust settles.  At least, we hope they will be addressed.

All eyes now turn to the House of Representatives.  Will the House deal with this bill in a timely manner?  And if it does, will House members actually pass it?

We are down to mere hours now before the current Congressional term ends. At that point, if the bill has not been passed by the House, it will come unglued and its parts will be passed over the wall to the next Congress.

Representative Ted Poe of Texas Introduces House Resolution 5845, to Extend WOTC for Veterans

House Resolution 5845 was introduced by Congressman Ted Poe of Texas and referred to the House Ways and Means Committee last Friday (on May 18th).  As of this afternoon, the actual text of the bill is not yet available. The title, however, is listed as

H.R.5845 – To amend the Internal Revenue Code of 1986 to extend the work opportunity tax credit for veterans and to allow an exemption from an employer’s employment taxes in an amount equivalent to the value of such credit.

As a bipartisan effort, HR 5845 has two co-sponsors to date. These include Republican Representative Ann Marie Buerkle of New York and Democrat Representative Russ Carnahan of Missouri.

We’ll keep an eye on this. As part of an overall effort to extend WOTC, this can only add a little momentum in the right direction. Right?

Minnesota Fails to Reach Agreement on Jobs Tax Credit Proposals

In January, I mentioned that Minnesota’s Democrat Governor Mark Dayton was proposing state jobs tax credits to reward employers who hire veterans, unemployed workers, and recent graduates.  During the intervening months, this ongoing story hit the news a surprising number of times . . . almost always in the context of budgeting disagreements between state Democrats and the Republican controlled Minnesota legislature.

In the end, the Minnesota legislature did include some variety of jobs tax credits in two bills submitted for Governor Dayton’s signature.  Unfortunately, both were vetoed in their turn.  Read a recent commentary by Julianne Ortman in the Twin Cities’ Star Tribune.  A May 17 editorial, also in the Star Tribune, provides another perspective.

 

Wisconsin Governor Scott Walker Signs State’s Veterans Jobs Bills

Wisconsin Governor Scott Walker signed three bills yesterday, designed to help military veterans in that state to find jobs.  Each of the bills had been authored by Wisconsin State Representative Evan Wynn.

Watch the local FOX affiliate’s news coverage of the event.  Representative Wynn’s press release follows below.

 

******** Representative Evan Wynn’s Press Release

(Madison, WI) – Governor Scott Walker signed into law Wednesday three bills authored by state Representative Evan Wynn that are aimed at helping veterans find jobs. The bipartisan bills were signed into law in Appleton, Wisc., at a Veterans of Foreign Wars Post and are part of Wisconsin’s 2012 Year of the Veteran initiatives.

“These bills are great for the veterans community and Wisconsin’s economy as a whole,” said Wynn. “Veterans have so much to contribute to their communities and this state, but the economic downturn of the last few years has left them with an unemployment rate double the average, with disabled veterans being hit even harder – 50 percent unemployment by some estimates.”

“With Governor Walker’s signature and the support of nearly every single member of the legislature, Wisconsin today made veterans and jobs a top priority,” added Wynn.

The bills received near unanimous support in the state Senate and Assembly, with only four votes against all three bills combined.

The first bill, now known as Act 209, waives the fee for most first-time professional and occupational licenses being sought by veterans. The second bill was signed into law as Act 211, and applies the federal guidelines when it comes to the appointment of disabled veterans to civil service jobs to the state civil service. Under the bill, a disabled veteran who is qualified for a position in state government may be appointed to that position rather than go through the state hiring process.

“Making it easier for veterans to transfer to civilian life is the least we can do to these honorable men and women who fought for us,” said Wynn. “These two bills are steps in the right direction for Wisconsin and our veterans.”

The third bill signed by Gov. Walker Wednesday, Act 212, creates a disabled veterans jobs tax credit that emphasizes full-time positions.

“Even more important that a job to disabled veterans facing 50 percent unemployment is a full-time job, which is why this bill emphasizes full-time and long-term employment by giving the largest tax credit to the employers that keep the veterans employed full-time and for more than three consecutive years,” said Wynn, who is a 22-year Army veteran himself.

Wynn also expressed his thanks to his colleagues who supported the measures in committee and on the floor with their votes and speeches, including the bipartisan coalition of 43 senators and representatives who are co-sponsors of the bills and Senator Julie Lassa and former Senator Pam Galloway, who co-authored the bills.

Rep. Wynn represents the 43rd Assembly District, which covers portions of Rock, Jefferson, Dane and Walworth counties.

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Alabama Heroes for Hire Act Signed by Governor

Alabama Governor Robert Bentley signed the state’s Heroes for Hire Act yesterday.   Read the press release from the Governor’s website, copied below.

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MONTGOMERY – Governor Robert Bentley on Wednesday signed into law the Heroes for Hire Act, which will help veterans returning from deployment find new jobs or start new businesses.

“When our service men and women were called to defend our freedoms, they didn’t ask questions. They simply answered the call to serve,” Governor Bentley said. “We must not forget the sacrifices veterans have made, and we encourage employers to remember our veterans as they fill open positions.”

The Act provides an additional $1,000 tax credit for job creation to employers who hire recently deployed, and now discharged, unemployed veterans. The Act also creates a $2,000 income tax credit to recently deployed, and now discharged, unemployed veterans who start their own businesses.

“Veterans have a unique set of skills and valuable experience that will benefit the companies that hire them,” Governor Bentley said. “Many veterans also have ideas that can help them launch a new business, and we want to give them every opportunity to succeed as they return home from service.”

The bill was sponsored by State Representative DuWayne Bridges and State Senator Tom Whatley.

“With wars winding down in Iraq and Afghanistan, thousands of Alabama veterans are returning home to a difficult economy in which it is hard to find a job,” Rep. Bridges said. “We need to give returning veterans every advantage we can toward finding employment. Our ‘Heroes for Hire’ bill does that by giving businesses a significant incentive for hiring a veteran who recently returned from war. Those who served on the front lines deserve to go to the front of the line for new jobs.”

“We need to do right by our heroes. These men and women put their lives on the line for our country,” Senator Whatley said. “This new law not only reaffirms our commitment to supporting our veterans, but also will contribute to Alabama’s decreasing unemployment rate.”

The Adjutant General of the Alabama National Guard added that the Heroes for Hire bill will benefit the livelihoods of veterans seeking new opportunities upon their return to Alabama.

“It is great to see the Governor and the Alabama Legislature promoting our veterans’ employment,” Major General Perry Smith said. “The Alabama National Guard has a higher unemployment rate than the state average, so this bill will be a great morale booster. More than that, it could be a life-changer for many Soldiers and Airmen.”

The Alabama Career Center System is a valuable resource for veterans searching for a new job. The system has career centers across the state, and connecting veterans with employment is among the system’s primary services. The Alabama Career Center System is managed under the authority of the Alabama Department of Industrial Relations and has additional information online at www.joblink.alabama.gov.

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New Mexico State Veteran Employment Tax Credit

HR 97 passed the New Mexico House and Senate in February.  The bill, which was part of New Mexico Governor Susana Martinez state tax-reform package, provides a one-time $1,000 tax credit to employers when they hire a qualifying veteran.

Governor Martinez issued the following statement in mid-February when the bill initially passed the state House of Representatives.

“We owe it to the men and women who fight for our freedom to make sure that they have jobs available to them when they return home,” said Governor Martinez. “Sadly, our veterans are coming back to some very difficult economic times and it is heartbreaking that many of these heroes are forced to stand in the unemployment line. This tax credit will provide New Mexico employers with a significant incentive to get our veterans back to work and honor the brave soldiers who have sacrificed so much on our behalf.”