WORK OPPORTUNITY AND WELFARE TO WORK TAX CREDIT (WOTC)

The Small Business and Work Opportunity Act of 2007 reauthorized the Work Opportunity Tax Credit (WOTC) and the Welfare-to-Work Tax Credit (WtW) for employers who hire long-term welfare recipients. Long-term recipients can earn their employer a tax credit of up to $4,000 for their first - and $5,000 for their second - year of employment. Welfare recipients and members of other target groups can earn employers a WOTC credit of up to $2400 in the first year. The number of new hires who can qualify employers for these credits is unlimited. For specific details about the benefits of this program, and the requirements for eligible employees, contact the Virginia Employment Commission (VEC) at 804-786-2887.

Employers must apply for and receive certification from the VEC that their new hire belongs to one of nine groups of jobseekers eligible for the WOTC or WtW programs before claiming it on their federal income tax return.

To apply employers need only complete two single-page forms:

1. IRS form 8850.This form must be mailed to the VEC no later than the 21st day after the job applicant begins work. IRS form 8850 is available on line at: http://www.irs.gov/pub/irs-fill/f8850.pdf .
   
   Instructions for the form are at: http://www.irs.gov/pub/irs-pdf/i8850.pdf
   
   or, call the IRS at 1-800-829-3676.
   
   
2. U.S. Department of Labor form ETA 9061. Access this form at: http://www.vec.state.va.us/pdf/eta9061.pdf
   
   To receive this form by mail call the VECWOTC unit at 804-786-2887, or fax your request to 804-796-1285.
   
   Employers should mail the signed IRS and ETA forms to:
   Virginia Employment Commission
   WOTC Coordinator, Room 209
   P. O. Box 1358
   Richmond, VA 23218-1358