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WOTC
17.271
This federal tax credit was designed to help individuals from certain targeted groups who consistently face significant barriers to employment move from economic dependency to self-sufficiency. Businesses are encouraged to hire targeted group members in order to claim the tax credit against wages paid to eligible new hire(s) during their first year of employment. WOTC joins other workforce programs that incentivize workplace diversity and facilitate access to good jobs for American workers.
This chart shows obligations for the program by fiscal year. All data for this chart was provided by the
administering agency and sourced from SAM.gov, USASpending.gov, and Treasury.gov.
For more information on each of these data sources, please see the
About the data page.
In Fiscal Year (FY) 2021, the Employment and Training Administration (ETA) distributed grant funds totaling $18,485,000 to 53 state workforce agencies for the administration of the Work Opportunity Tax Credit (WOTC). Additionally, the Consolidated Appropriations Act, 2021 authorized an additional $2,500,000 in funding to WOTC, which ETA distributed to 12 states with the most critical needs to alleviate processing backlogs and assist states in adopting or modernizing information technology for processing of certification requests. In FY 2020, a total of 1,620,806 WOTC certifications were issued to eligible employers. Following the COVID-19 pandemic, SWAs were able to resume normal certification request processing capabilities, and issued 2,081,474 WOTC certifications at the close of FY21, an increase of 22 percent from certifications issued in FY20.
In Fiscal Year (FY) 2023, ETA distributed grant funds totaling $20,985,000 to 53 state workforce agencies (SWAs) for the administration of the WOTC and to 14 states for alleviating processing backlogs and modernizing WOTC processing systems. As a result, SWAs have successfully decreased their backlog of certification requests, and more SWAs are utilizing automated systems to increase processing efficiency. In FY 2023, SWAs issued 1,982,858 certifications.
In Fiscal Year (FY) 2024, ETA distributed grant funds totaling $20,985,000 to 53 state workforce agencies (SWAs) for the administration of the WOTC and 13 states selected for additional funding to support efforts for alleviating processing backlogs and modernizing WOTC processing systems. ETA revised the information collection for WOTC processing forms, including ETA Form 9061, Individual Characteristics Form, and updated the procedural guidance used by SWAs to administer the program. To date (as of quarter ending 6/30/24), SWAs have issued 1,085,355 employer certifications.
Single Audit Applies (2 CFR Part 200 Subpart F):
For additional information on single audit requirements for this program, review the current Compliance Supplement.
OMB is working with the U.S. Government Accountability Office (GAO) and agency offices of inspectors general to include links to relevant oversight reports. This section will be updated once this information is made available.
