Get 2009 Form 5884. Work Opportunity Credit

The Work Opportunity Tax Credit (WOTC) is a Federal tax credit available to employers for hiring and employing individuals from certain targeted groups who have faced significant barriers to employment.

More In Forms and Instructions An eligible employer who continued to pay or incur wages after the employer's business became inoperable because of damage from a qualifying major disaster may be able to claim a credit equal to 40% of up to $6,000 of qualified wages paid to or incurred for each eligible employee.

If you have copies of your prior year tax returns, you can check them to see how many times you claimed the credit.

What is the Work Opportunity Tax Credit (WOTC)? The WOTC promotes the hiring of individuals who qualify as members of target groups, by providing a federal tax credit incentive of up to $9,600 for employers who hire them.

Employers file Form 5884 to claim the work opportunity credit for qualified first- and/or second-year wages they paid to or incurred for targeted group employees during the tax year.

Claiming the American Opportunity Tax Credit You need to complete the relevant sections of IRS Form 8863 and include it with your income tax return to claim the credit. For tax year 2023, the credit begins to phase out for: Single taxpayers who have adjusted gross income between $80,000 and $90,000.

An eligible employer who continued to pay or incur wages after the employer's business became inoperable because of damage from a qualifying major disaster may be able to claim a credit equal to 40% of up to $6,000 of qualified wages paid to or incurred for each eligible employee.

After the required certification is secured, taxable employers claim the WOTC as a general business credit against their income taxes, and tax-exempt employers claim the WOTC against their payroll taxes. WOTC is authorized until December 31, 2025 (Section 113 of Division EE of P.L.