Alabama Department of Labor

Work Opportunity Tax Credit - WOTC

U.S. Department of Labor

Work Opportunity Tax Credit - WOTC

The Work Opportunity Tax Credit (WOTC) is a federal tax credit available to employers who invest in American job seekers who have consistently faced barriers to employment. Employers may meet their business needs and claim a tax credit if they hire an individual who is in a WOTC targeted group.

Employers must apply for and receive a certification verifying the new hire is a member of a targeted group before they can claim the tax credit. 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. 116-260 -- Consolidated Appropriations Act, 2021).

For further information, visit the IRS WOTC Website or the U.S. Department of Labor WOTC Website.

WOTC Fact Sheet* Work Opportunity Tax Credit: Quick Reference Guide for Employers
WOTC Eligibility Desk Aid Individual Characteristics Form - ETA Form 9061 *
IRS Form 8850 *
Long-Term Unemployment Recipient Self-Attestation Form
IRS Form 8850 Instructions *
Alabama WOTC on-line for employers Alabama WOTC on-line for Consultants

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Updated November 24, 2021