Employers Get Retroactive Extension to Apply for 2014 Work Opportunity Tax Credit by Karen A. Lake, CPA

Posted on March 30, 2015 by Karen Lake

Employers who hired qualified veterans or members of certain disadvantaged groups in 2014 and missed the 28-day period to apply for a Work Opportunity Tax Credit (WOTC) now have until April 30, 2015, to claim the credit equal to $1,200 and $9,600 per qualifying employee.


The WOTC, established to remove barriers to employment for specific groups of eligible workers, requires employers to obtain certification that employees are, in fact, members of a targeted group.  In addition to completing a pre-screening notice for each new employee on or before the day the individual is offered employment, employers were required to submit Form 8850, Pre-Screening Notice and Certification Request for the Work Opportunity Credit to their State’s Workforce Agency (SWA) within 28 days following the qualifying employee’s first day on the job.


With the newly announced application extension, the IRS is waiving the original 28-day deadline to apply for the federal tax credit equal to up to 40 percent of a qualifying employee’s first year wages. Businesses that missed the deadline or were sitting on the fence in 2014 now have until April 30 to retroactively submit Form 8850 for all eligible employees hired in 2014.


About the Author: Karen A. Lake, CPA, is associate director of Tax Services with Berkowitz Pollack Brant.  She can be reached at the Miami CPA firm’s office at (305) 379-7000 or via email