Federal Tax Credits for Staffing Firms (Many Firms Can Benefit!)

Protecting Americans from Tax Hikes (PATH) Act of 2015

2015 Tax Credits

At the end of 2015, President Obama signed the Protecting Americans from Tax Hikes (PATH) Act of 2015, a bill designed to help grow the American economy and allow taxpayers to keep more of their hard-earned dollars.[more]

Included in the bill was a 5-year extension of the Work Opportunity Tax Credit (WOTC), a federal tax credit rewarding companies for employing individuals who have previously faced significant barriers to employment. This will extend the credit through the end of 2019.

In addition to the extension, a new category was also added to the WOTC, allowing tax credits to be earned for hiring individuals who were unemployed for a period of 27 weeks or longer. Staffing firms are likely to benefit from this program more than just about any other industry because of their high turnover, volume of hires and average pay rate.

Applying for WOTC Can Be Complex – Advance Can Help!

To apply for these tax credits, employers are required to fill out two forms, IRS Form 8850 and ETA Form 9061, during a new hire onboarding. They must then submit those forms to the Department of Labor within 28 days of the new hire to be eligible for the tax credits.

Relief period for 2015

This extension is retroactive for 2015, so employers who have not yet submitted their forms can still benefit from their 2015 hires. The 28-day deadline will be waived for these employers because the act was passed so late in the year. However, this will be a very brief period, so companies need to act quickly to earn tax credits for any 2015 hires.

Get the credits you deserve

With tax season upon us, it is important that you take steps now to benefit from your recent hires. Advance Partners will help you apply for all of your eligible tax credits in order to reduce your tax burden this year.

Contact Advance Partners today to get started earning your Work Opportunity Tax Credits.


This blog post is based on an article originally written by Marcel Abandonato from MJA & Associates. Contact Marcel at 951-272-8294 or marcel@mja-associates.com.