Posted by jtessler on May 28th, 2013

2012 WOTC Target Group Certifications

By: Dawn Jameson, WOTC Coordinator

Each year, State Workforce Agencies (SWAs) provide details to the Department of Labor on the activity they’ve experienced for the previous calendar year in administering the WOTC program. Beyond listing their total workload, each SWA provides the number of certifications and denials that were issued and the breakdown by target group category. 2012 was an unusual year for employers and tax credit consultants, due to the hiatus of the WOTC program. During that time, the only authorized target groups were the Veteran groups which had been previously created by the Vow to Hire Heroes Act. Despite the hiatus, most tax credit consultants continued to submit applications on behalf of their clients for all target groups in anticipation of the program’s renewal, and this practice is apparent in the total workloads reported by the SWAs.

Historically, food stamp (SNAP) recipients have accounted for the majority of WOTC certifications, and 2012 was no exception. Of the over three and a half million WOTC applications submitted nationwide during 2012, 67.5% were for the SNAP target group. To put this into perspective, the second largest target group was for the Long Term Temporary Assistance for Needy Families (TANF) category, which accounted for only 8% of all 2012 certifications issued.

At the other end of the spectrum, there are some target groups that account for a relatively small number of certifications issued by the SWAs. The Veteran, Summer Youth and Ticket Holder target groups each account for less than 1% of certifications issued. Although the percentages for the Veteran group certifications are low in comparison, it is important to note that they are demonstrative of over 19,300 Veterans, some disabled, that have been returned to the workforce.

Not surprisingly, Texas lead the way again last year with a total workload of well over 385,000 WOTC applications, followed by California with 262,550 applications. Because SWAs are state agencies working with tight state budgets, they must work as efficiently as possible. As a result, many states are moving toward process automation. Currently, there are 17 SWAs that use online filing systems, greatly reducing the manpower required to manage the process. The most recent convert to e-filing was Utah, which saw over 40,000 WOTC applications submitted last year.

Understanding the magnitude of the SWAs workload is key for successfully navigating the WOTC world. Because many external factors influence the volume and speed with which a SWA can process an application, it is important to have an advocate that can work closely with the SWAs and deliver aid when possible. Tax Credit Co. is proud to work with all SWAs and maintain close relationships with the state WOTC Coordinators. If you have questions about your WOTC program or would like more information on how Tax Credit Co. can be your advocate, visit us at www.taxcreditco.com or at 1-800-481-0669.

Posted by jtessler on May 7th, 2013

Encouraging WOTC Statistics

By: Dawn Jameson, WOTC Coordinator at Tax Credit Co.

It has been a very good year for the Work Opportunity Tax Credit, indeed. The Department of Labor recently published a few statistics attesting to the success of the program, specifically regarding certifications for the Veteran target groups and a few select states.

As we are all well aware, calendar year 2012 was a year of hiatus but even though the non-veteran target groups were not being actively processed, states were still able to issue 899,000 certifications for the veteran based groups. That is nearly 900,000 veterans back in the workforce! These would include disabled and/or unemployed veteran subsets, made possible by the Vow to Hire Heroes Act of 2011. Also for 2012, the DOL reports that the number of certifications for the veteran target group alone doubled from the previous year.

Two states have been identified as having a substantial increase in WOTC applications being filed. Kentucky saw a substantial increase in submissions from 2009 to 2012, processing an additional 42,000 requests. Further, the state of Florida has seen unprecedented numbers as well. Each week, they receive over 3,000 applications. They reported 628 pending requests in 2011 and over 86,000 in 2012. Both states use electronic portals that allow applications to be submitted online, rather than manually, drastically reducing staff workload and reducing the turn-around time for employers to receive their determinations.

Currently, 16 states utilize online filing systems for WOTC applications and many others plan a move to this more efficient way of processing. You may be in a state that allows for electronic submissions. For more information, contact us today at 800-481-0669 or me directly at djameson@taxcreditco.com.

Posted by jtessler on April 17th, 2013

Obama Administration Proposes Permanent Extension of WOTC Program

By: Dawn Jameson, WOTC Coordinator at Tax Credit Co.

President Barack Obama released his administration’s proposed 2014 budget last week, detailing his plan for spending and increasing revenue. Within his proposal, the President outlines his game plan for reducing funding for Social Security by over $230 billion, providing universal access to pre-kindergarten education, cuts to the Department of Defense, and other initiatives.

However, there is one proposal that captures the attention of business owners and tax incentive consultants nationwide. In the section titled “Strengthening the Middle Class and Making America a Magnet for Jobs,” President Obama proclaims that his administration “continues its support of tax credits that will help employ veterans” and notes that the WOTC program provides critical incentives for hiring veterans. As a result, the President recommends that the WOTC program be permanently extended.

If you survived the uncharacteristically long WOTC hiatus of 2012, you understand the magnitude of this initiative. Although the budget plan will undoubtedly be revised and altered, the proposal remains. Perhaps it won’t be this year that we see the permanent extension. Maybe it will be a few years down the road. But because WOTC houses the Returning Heroes and the Wounded Warrior Tax Credits, both aimed at encouraging the hiring of our returning veterans, the WOTC credit now reaches a broader audience than it did in the late nineties when the program began, and therefore, carries more weight. Permanent extension of the credit will create a more stable incentive program, since the need for continuous lobbying and hiatus practices will cease, thereby increasing participation in the program.

For the full text of the budget released by the White House, visit www.Whitehouse.gov/omb/budget.
As always, for more information on WOTC and how your business may take advantage of it, including the unprecedented 2012 retro WOTC project now taking place, contact us at (800) 481-0669 or visit us at www.taxcreditco.com.

Posted by jtessler on April 10th, 2013

Retroactive WOTC Opportunity Demonstrates Tax Credit Co.’s Core Principles

By: Dawn Jameson, WOTC Coordinator

At Tax Credit Co., we always operate with three core principles in mind – “No Tax Credit Left Behind,” “Innovative Solutions to High Value Problems,” and “Our Clients Love Us.”
First, we take “No Tax Credit Left Behind” seriously. The Internal Revenue Service, in IRS Notice 2013-14, recently authorized retroactive filing for WOTC applications for employees hired from January 1, 2012 to March 31, 2013. It would be easy to dismiss this one-time opportunity due to the significant amount of paperwork involved and the extremely short window of time available in which to complete it. But that wouldn’t fulfill the promise we make to our clients. Because we know how hard you work to make your business a success, our commitment is to investigate and pursue all available incentive opportunities, including rare situations such as this retroactive WOTC screening opportunity.

Second, we thrive on “Innovate Solutions to High Value Problems.” This is evidenced by the way we capture job applicant data. Applicants are complicated. Some job applicants may never be hired, some may be hired multiple times by the same employer, while others may leave a job before necessary credit compliance documents are collected. The internal data collection process at Tax Credit Co. was designed to easily and thoroughly collect and maintain the information required to pursue both federal and state incentives, such as WOTC and California Enterprise Zone credits. Our applicant information system is one of the key reasons we enjoy a 99.3% audit acceptance rate and also the reason why we are able to take advantage of the retroactive WOTC opportunity now available.

Have you been told by tax incentive consultants that your company is too small or that the credit program you’re interested in won’t yield a return significant enough to pursue? Have you done research on a credit you think you may be eligible for, but were dismissed by your provider? Have you found a program that you were eligible for only to find out that it has now expired? Are you reading about the retroactive WOTC opportunity and wondering how you can take advantage of these opportunities? Because we scrutinize these sometimes obscure programs for you and leverage best-in-class technology to pursue them, our last core principle naturally follows – “Our Clients Love Us.”

You should love your tax incentive consultant. To speak with someone today about a particular credit program or to discuss the retroactive WOTC project now taking place at Tax Credit Co., contact us at (800) 481-0669, or visit us at www.taxcreditco.com.

Posted by jtessler on April 3rd, 2013

Not Ex-Offenders, but Felons

By: Dawn Jameson, WOTC Coordinator at Tax Credit Co.

No, it actually isn’t any offender that will generate a WOTC credit for your business. Generally, the socially accepted terminology has gone from referring to someone as a “felon” to referring to them as an “ex-Offender” but this is misleading in terms of WOTC. Guaranteeing that a business that hires Ex-Offenders will have hundreds in tax credits is faulty because someone convicted of any crime is technically an ‘offender.’

In the simplest of terms, crimes are broken down into two groups: felonies and misdemeanors. Felonies carry a punishment of over 1 year in prison or by death while misdemeanors bring a fine or incarceration for less than 1 year. Further, those convicted of a felony lose the right to certain employment positions, such as attorneys and teachers. They cannot serve on a jury and sometimes lose their right to vote, the right to carry a gun or serve in the military. Examples of felonies are murder, grand theft, kidnapping and some drug crimes.

If you are just dipping your toes into the world of WOTC, know that the only population that will be recognized by this credit program are those convicted of a felony – not just accused or tried but actually convicted. Beyond that, they must also be hired within one year of their conviction date or their release from prison.

Considering the severity of the crime and subsequent punishment, most people who go through the justice system and are convicted are very aware of these fundamental differences. However, because there are small caveats in this target group that may open up the eligibility pool, it’s best to rely on a tax credit specialist whose job is to live in the details and make sure you’re capturing everything you can.

Visit our website at www.taxcreditco.com for more details.

Posted by jtessler on March 28th, 2013

Empowerment Zones No Longer a Memory

By: Dawn Jameson, WOTC Coordinator at Tax Credit Co.

Geographically based programs and tax incentives have a long history of interfacing with WOTC, particularly Renewal Communities, Rural Renewal Counties and Empowerment Zones. The Department of Housing and Urban Development designates and oversees Renewal Communities and Empowerment Zones throughout the country. Renewal Communities expired at the end of calendar year 2009 but Empowerment Zones were active and valid until the end of calendar year 2011. However, when the American Taxpayer Relief Act was signed at the beginning of this year, their designations were extended.

The IRS has recently released further guidance on how state and local governments are to proceed. For details, see: http://www.irs.gov/portal/site/irspup/menuitem.143f806b5568dcd501db6ba54251a0a0/?vgnextoid=c6099d811b39d310VgnVCM1000003b4d0a0aRCRD&vgnextchannel=21c31c39af0c6310VgnVCM10000024150a0a____.

Posted by jtessler on March 20th, 2013

The WOTC Jigsaw Puzzle

By: Dawn Jameson, WOTC Coordinator at Tax Credit Co.

If you’ve been overwhelmed trying to sort out which specific WOTC target groups were legislatively authorized on a specific day or month, you’re not alone. Added to the sheer volume of available groups, we have a constantly changing political climate that allows the expiration, retroactive authorization and relief periods for certain groups but not always others. It can be a jigsaw puzzle many employers choose not to try to put together.

Of particular concern to many employers is the subset of target groups dealing with United States Veterans. For calendar year 2012, the Vow to Hire Heroes Act gave us the disabled and unemployed Veterans’ categories and also extended the Vet SNAP category – 5 Vet-specific areas, all in all. During that year, these were the only categories that were authorized to be certified by the State Workforce Agencies because the general WOTC had expired on December 31, 2011. SSI Recipients, Ex-Offenders, TANF Recipients, etc. were all filed but awaited further direction from the IRS and DOL ETA, which eventually came in the form of the American Taxpayer Relief Act, signed in January of this year.

The Act retroactively authorized each target group, including the Veteran subset. The only things that did not get re-instated were the two groups created some years ago by ARRA (unemployed veteran and disconnected youth). Everything is available until December 13, 2013, when WOTC consultants, employers and lawmakers will join hands once again to attempt to carry the credit over the finish line.
Earlier this month, IRS Notice 2013-14 was issued, and addressed the employers’ need for additional time to comply with the Taxpayer Relief Act. If you have paperwork from hires from calendar year 2012 that wasn’t filed with the SWA, this is your mulligan. Maybe you were aware of the 28 day rule for applications and thought you’d missed it so you just round-filed it. Maybe you didn’t screen at all because 2012 was a year of hiatus. Either way – the good folks at the IRS are giving you a free pass.

When you get sick, you go to a general practitioner, but when you have a heart attack, you go to a cardiologist. WOTC consultants are the cardiologists of accounting. It is our job to understand the minutiae of these credits – expiration’s, retro filings and all – and maximize the health of your business. Contact us Tax Credit Co. today to ensure you are taking full advantage of your incentive potential.

Posted by jtessler on March 18th, 2013

Retroactive Filing Authorized for WOTC

By: Dawn Jameson, WOTC Coordinator at Tax Credit Co.

2012 was a difficult year for businesses participating in the Work Opportunity Tax Credit. The credit had expired on December 31, 2011 and was not reauthorized until the early part of 2013, which left all of calendar year 2012 up in the air. Although the program has gone into hiatus many times since its creation and then been retroactively authorized, the waiting period was uncharacteristically long. Unfortunately, many businesses chose to not participate.

If you were one of those taxpayers that saw the process as confusing and decided to wait on a simpler program or until the program was out of hiatus, you’re in luck. The IRS issued Notice 2013-14 last week, authorizing the retroactive screening for 2012 hires. This allowance opens the potential screening pool tremendously for employers as ordinarily, the filing deadline is set firmly at 28 calendar days from the applicants’ start date. The new deadline for these applications is now April 29, 2013.

You may view the IRS Notice 2013-14 in its entirety at http://www.irs.gov/pub/irs-drop/n-13-14.pdf.

If you have applicants who were screened and qualified but were not submitted, or if you’d like more information on the notice and your WOTC screening protocols, contact Tax Credit Co. today. One of our core business principles is No Tax Credit Left Behind, and we’re very serious about this. Visit us at www.taxcreditco.com or call 1-800-481-0669 for more details.

Posted by jtessler on March 6th, 2013

TAX CREDIT CO. ACQUIRES INCENTIVES ADVISORS

Acquisition Expands Capabilities; Strengthens Position in Hiring Incentives, Training Credits, and Negotiated Incentives

LOS ANGELES, CALIFORNIA – March 5, 2013 – Tax Credit Co. (“TCC”), a national provider of tax incentive consulting, administration and technology, today announced that it has acquired Incentives Advisors (“IA”), a nationwide government incentives technology and services provider. The acquisition strengthens TCC’s position as an industry leader by adding IA’s programs in training grants, negotiated incentives, and other government programs, expanding TCC’s market penetration and enhancing its growing Work Opportunity Tax Credit (WOTC) business for national employees.

“Together, Tax Credit Co. and Incentives Advisors create a uniquely positioned business in the tax incentives market,” says Bill Becker, President, CEO and co-founder of IA, based in Phoenix, Arizona. “The combination of TCC’s market leadership in research & development (R&D) credits, WOTC, and California incentives, with IA’s comprehensive hiring incentive screening technology and expertise in nationwide incentive programs establishes our leading market position. Businesses become more profitable by taking advantage of available government dollars, and we have been delivering these valuable incentives through seamlessly integrated solutions with valued partners such as Oracle/Taleo, HRsmart and Snagajob. We now are excited to join forces with TCC to help employers maximize these benefits with an even broader solution.”

Brandon Edwards, CEO of TCC stated, “In line with our focused acquisition and growth strategy, we are excited to add IA’s people, clients and capabilities to the TCC family. We believe clients will benefit from IA’s additional services, such as job training and negotiated incentives, as well as their seasoned management team. An important consideration in our decision to acquire IA was its technology, expertise and market penetration in nationwide incentives including WOTC, state, and local credits, which is the fastest growing area of TCC’s business. These are valuable additions to our diverse portfolio of services, which includes California Enterprise Zone incentives, R&D credits, sales/use & excise tax consulting, and other state and federal tax incentives.” Edwards adds, “We are proud to bring IA co-founders Bill Becker and Shaung Liu, as well as other industry veterans from the IA leadership team, to TCC.”

The acquisition of IA is the first transaction since TCC received an investment in November 2012 to accelerate organic growth and pursue add-on acquisitions in a highly fragmented industry from Veronis Suhler Stevenson (“VSS”), a private investment firm focused on the information, education, media, marketing and business services industries. “We are very pleased to complete this acquisition, which extends TCC’s leadership position in the tax credit and incentive solutions industry” said Michael Kessler, Managing Director of VSS.

About Tax Credit Co. Tax Credit Co. is a national provider of tax incentive consulting, administration and technology, serving clients from Fortune 100 to small business. Tax Credit Co. helps clients increase earnings by optimizing the process of obtaining state and federal tax incentives, including state and federal research and development tax credits, state enterprise zone tax credits, national hiring incentives such as the Work Opportunity Tax Credit (WOTC) and other state and federal programs. Tax Credit Co.’s proprietary, next-generation software platform manages national tax credit screening and compliance for large, complex organizations. Tax Credit Co. is headquartered in Los Angeles. For more information, please visit the company’s website at www.taxcreditco.com.

About Incentives Advisors
Incentives Advisors (IA) is an industry leader in helping businesses maximize available government incentives. IA’s programs include hiring-related tax credits and incentives, cash training grants, negotiated incentives, cost segregation studies and green incentives. IA was a Workstream, Inc. company, a leading provider of Human Capital Management software solutions. For more information, please visit the company’s website at www.incentivesadvisors.com.

About Veronis Suhler Stevenson Veronis Suhler Stevenson is a private equity and debt capital fund management company dedicated to investing in the information, education, media, marketing and business services industries in North America and Europe. VSS provides capital for buyouts, recapitalizations, growth financings and strategic acquisitions to companies and management teams with a goal to build companies both organically and through a focused add-on acquisition program. Since the closing of the first VSS Buyout Fund in 1987, VSS has managed four Buyout Funds and two Structured Capital Funds with aggregate committed capital in excess of $3.1 billion. The six funds have to date invested approximately $2.8 billion in 72 portfolio companies which have in turn completed over 320 add-on acquisitions. The company’s website is www.vss.com.

For more information:
Bryan Edgar
Tax Credit Co.
(323) 927-0758
bedgar@taxcreditco.com

Posted by jtessler on February 27th, 2013

Know Your WOTC Words

Written by Dawn Jameson
WOTC Coordinator at Tax Credit Co.

Last week, I wrote about the difference in SSI and SSDI in conjunction with WOTC credits. But since we all love an acronym, especially when we have to get work done ASAP, a few other WOTC buzzwords should be investigated. Using abbreviations without fully understanding their full meaning or well-intentioned paraphrasing can sometimes distort the original intended meaning.

One key illustration that I try to highlight to newcomers to the WOTC world is the difference in an ‘applicant’ and an ‘employee.’ While we screen applicants for WOTC, we may not screen employees, because WOTC is a point of hire incentive. Likewise, we cannot claim a WOTC credit for an applicant because they have not been hired yet and therefore, they would have no wages to use in the calculations.

There has been great debate around the word ‘fax’ as well. Keep in mind this can be a noun or a verb. As a noun, a ‘fax’ is a paper reproduction of an original document that has been sent to an employer or consultant through a facsimile machine. Further, it could be the old familiar shiny paper with an easily recognizable header or footer or it could be an electronic copy. While some businesses continue to rely on the old machine, many more are adopting green initiatives to reduce paper waste. As a verb, ‘fax’ is simply the method of transmission for any document.

Finally, understand there is a major difference in someone who is ‘qualified’ and someone who is ‘certified.’ A qualified applicant is someone who, having been screened for WOTC, has indicated that they are a member of one of the recognized target groups. At this point, you take their word for their inclusion in a particular group. There is no credit approved for a qualified applicant. Let’s say you have an applicant that indicated they are a SNAP recipient and their WOTC application is sent to their SWA. They will remain ‘qualified’ until you receive a Certification on their behalf. A Certification is really just an attestation that the SWA has investigated the claim of the applicant receiving SNAP benefits and has verified it to be true. At this point, they are “Certified” and you may claim WOTC for this employee. (Notice I used ‘employee’ and not ‘applicant’ since they are understood to be employed.)

Know your WOTC words. If your applicants aren’t being screed for WOTC target groups such as SSI, TANF and SNAP, give us a call, ASAP.

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