Work Opportunity Tax Credit (WOTC) - Target Groups
The Work Opportunity Tax Credit (WOTC) provides a tax credit of up to $9,000 for employers who hire individuals who belong to one or more of the nine target groups specified in the law. The groups are defined below; you can scroll through the list, or go to a specific definition by clicking on the title.
- Qualified Aid to Temporary Assistance to Needy Families (TANF)
- Qualified Veteran
- Qualified Ex-Felon
- Qualified High Risk Youth
- Vocational Rehabilitation Referrals
- Qualified Summer Youth
- Qualified Food Stamp Recipient
- Qualified Supplemental Security Income Recipient
- Qualified Long-term Family Assistance Recipient
Qualified recipients of TANF - Any individual who is a member of a family receiving TANF (or a successor program) for any 9 months during the last 18 months ending on the hiring date.
Qualified Veteran - An individual who is certified by the designated local agency:
- as a member of a family receiving Food Stamps for a continuous three (3) month period during the last 15 months ending on the hiring date, and
- has served on active duty (other than active duty for training) in the Armed Forces of the United States for a period of more than 180 days, or was discharged or released from active duty in the Armed Forces of the United States for a service connected disability, and
- did not have any day during the 60 day pre-employment period which was a day of "extended active duty" in the Armed Forces of the United States.
Qualified Ex-Felon - An individual who is certified by the designated local agency:
- as having been convicted of a felony under any statute of the United States or any State,
- as having a hiring date which is not more than 1 year after the last date on which such individual was so convicted or was released from prison.
Qualified High Risk Youth - An individual who is certified by the designated local agency:
- ages 18-24 on the hiring date, and
- as having his principal place of abode within an Empowerment Zone or Enterprise Community. (See below for additional information on the residency requirement for this category.)
Vocational Rehabilitation Referral - An individual who is certified by the designated local agency as:
- having a physical or mental disability which, for such individual, constitutes or results in a substantial barrier to employment, and
- was referred to the employer upon, or at any time after, completing or while receiving rehabilitative services pursuant to an individualized written rehabilitation plan (IWRP) under a State plan for vocational rehabilitation services approved under the Rehabilitation Act of 1973, or a vocational rehabilitation program for veterans carried out under Chapter 31 of Title 38, United States Code.
Qualified Summer Youth - An individual who:
- performs services for the employer between May 1 and September 15,
- is certified by the designated local agency ages 16-17 on the hiring date (or if later, on May 1 of the calendar year involved),
- has not previously worked for the employer seeking this tax credit, and
- is certified by the designated local agency as having his principal place of abode within an Empowerment Zone, Enterprise Community, or Renewal community. (See below for additional information on the residency requirement for this category.)
Qualified Food Stamp Recipients - An individual who is certified by the designated local agency as:
- ages 18 but not yet 40 on the hiring date, and
- as being a member of a family:
receiving Food Stamps for a continuous six (6) month period immediately prior to the date of hire, or receiving such assistance for a minimum of three (3) months out of the five (5) month period immediately prior to the date of hire, in the case of a family who ceases to be eligible.
Qualified recipient of Supplemental Security Income (SSI)
- Any individual who is certified by the designated local agency as receiving SSI benefits under title XVI of the Social Security Act (including SSI benefits of the type described in section 1616 of such Act or section 212 of Public Law 93-66) for any month ending within the 60-day period ending on the hiring date.
Long-term family assistance recipient
- Any individual who is a member of a family receiving AFDC/TANF for at least 18 consecutive months ending on the hiring date, or that
- is a member of a family receiving AFDC/TANF for any 18 months beginning after August 5, 1997, and is hired with two years, or
- whose AFDC/TANF eligibility expires under federal or state law after August 5, 1997, and is hired within two years after eligibility expires.
Federal Empowerment Zones (EZ), Enterprise Communities (EC), and Renewal Communities (RC)
Empowerment Zones, Enterprise Communities, and Renewal Communities, refers to an area or combination of areas meeting certain population, size and poverty criteria requiring joint nomination by the local government and the State(s) in which it is located. These nominated areas can be characterized as having pervasive poverty, unemployment and general distress.
Only certain census tracts within the listing of ZIP Codes are in an EZ/EC. Therefore, not all the qualified summer youth or high risk youth who reside within these ZIP Codes are eligible for the WOTC certification. For information on addresses located within EZ/EC/RCs, see the HUD web site.