Veteran’s Day is a time to take stock of how fortunate we are to live in a country with extensive freedoms, and how fortunate we are to have brave men and women who, generation after generation, step forward to willingly put their lives on the line to protect those freedoms for all of us.
While we give thanks to our military veterans through various celebrations, there is another important way we can recognize the value of veterans to America. Hire them!
The federal government’s Work Opportunity Tax Credit (WOTC) is a program that supports businesses that hire veterans, as well as other underserved groups, to allow them the opportunity to contribute to the prosperity of our country by giving tax credit for such hires.
WOTC applies to any veteran who falls into any of the following categories:
Is a member of a family that received Supplemental Nutritional Assistance Program (SNAP) benefits (food stamps) for at least a 3-month period during the 15-month period ending on the hiring date
Is disabled and entitled to compensation for a service-connected disability, who has been (a) hired within 1 year of discharge or release from active duty, or unemployed for at least 6 months in the year ending on the hiring date or
Is unemployed for (a) at least 4 weeks in the year ending on the hiring date or (b) at least 6 months in the year ending on the hiring date
The veteran’s status requires the veteran to (1) have served on active duty (not including training) in the U.S. Armed Forces for more than 180 days or to have been discharged or released from active duty for a service-connected disability, and (2) not have a period of active duty (not including training) of more than 90 days that ended during the 60-day period ending on the hiring date.
Additionally, even if the veteran does not fall into one of the above categories, WOTC can also apply if they fall under any of these eligible categories:
Individuals receiving food stamps
Individuals receiving Temporary Assistance For Needy Families (TANF)
Designated Community Residents From Federal Empowerment Zones or Rural Renewal Counties
Individuals Receiving Supplemental Security Income
Individuals Receiving Long-Term Unemployment
Vocational Rehabilitation Referrals
The Work Opportunity Tax Credit for most categories is $2,400, but certain categories, such as those for disabled veterans, can generate up to $9,600. The average amount of tax credits depends on the mix of target group new hires. It can add up to significant tax credits, whether the company is large or small. The tax credit creates an immediate boost to your bottom line because it reduces your tax bill dollar-for-dollar. Each $1 of WOTC saves you $1 in taxes.
There are many veterans who have significant skills to offer. Their military experience may foster a laser focus on work objectives, work well under pressure, and adapt quickly to change, among other skills. All they need is an opportunity to prove themselves.
If you really want to honor our veterans in a meaningful way, consider hiring them for your business. By hiring veterans, you will make a significant difference to the lives of the veterans you hire, your community, and your bottom line. And what could be more patriotic than that?
Tax credits are a great way for organizations to increase their bottom-line. If you’re interested in learning about WOTC, the ERC, or a different tax credit, contact us to see how we can help your organization start earning.