The WOTC is a federal tax credit available to employers who hire individuals from eligible target groups who are qualified for positions but face significant barriers to employment. In North Carolina, the Division of Workforce Solutions (DWS) administers WOTC and determines eligibility for the target groups.
According to the newly released data, DWS awarded certifications to 2,548 North Carolina employers for 75,745 new employees in the 2018 calendar year. That was a 3 percent increase in the number of employers and a 13.5 percent increase in the number of certifications compared to the 2017 calendar year. Those certifications allowed employers to potentially claim up to $188,466,600 in tax credits – an increase of 7.2 percent, or almost $12.7 million, over 2017.
“We attribute these increases both to greater demand in a time of job growth and low unemployment, and to improved efficiency by staff,” said N.C. Commerce Secretary Anthony Copeland. “We encourage businesses to use this important tax credit, because it supports their own success and helps bring more North Carolinians into the workforce so that they can contribute to their communities.”
After receiving a certification from DWS, employers may then apply for the tax credit with the Internal Revenue Service (IRS). A business can claim from $1,200 to $9,600 for each eligible employee, depending upon the target group of the person hired, the wages paid to that worker in the first year of employment, and the number of hours worked.
North Carolina has consistently ranked among the top 10 states and territories for WOTC certifications in recent years. For the 2017 federal fiscal year (the most recent full year for which the U.S. Department of Labor has published data), the state ranked eighth in the number of certifications, even while ranking 11th in the amount of federal funding provided to administer the program.
Among those who may qualify for the WOTC are certain veterans, recipients of public assistance, people with felony convictions, people with disabilities, and the long-term unemployed. Only new hires are eligible.
For more information, employers should visit www.nccommerce.com/grants-incentives/workforce-grants/work-opportunity-tax-credit or call (919) 814-0439.