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Work Opportunity Tax Credit Extended
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June 5, 2002 -- Supreme Court watchers expect a ruling any day now in the case Chevron v. Echazabal. The Court will decide whether the ADA permits an employer to exclude a person with a disability from employment because that person poses a direct threat to his or her own health or safety. The Ninth Circuit Court of Appeals ruled that an employer may not exclude individuals with disabilities based on threats to their own health or safety. Chevron has asked the Supreme Court to reverse that ruling.
A number of commentators have noted that the Supreme Court has battered the employment provisions of the ADA. The jobless rate of people with disabilities remains alarmingly high, with 2 of every three disabled jobseekers unable to find work.
A provision of the Small Business Job Protection Act of 1996 (P.L. 104-188), the Work Opportunity Tax Credit, is designed to give employers an incentive to hire disabled people through state vocational rehabilitation prorams. The Dept. of Labor calls it " one tool in a diverse toolbox of flexible strategies designed to help people move from welfare to work and gain on-the-job experience."
Employers who hire people through state vocational rehabilitation programs can get the tax credit for having hired these employees -- a credit of up to 40 percent of the first $6,000, or up to $2,400, in wages paid during the first 12 months for each new hire. The employee must work 180 days or 400 hours in order to qualify her employer for the credit ( partial credit of 25 percent for certified employees who worked at least 120 hours, but less than 400 hours, may be claimed by the employer).
To receive certification that a new employee qualifies the employer for this tax credit, the employer must complete a few simple forms; more information about the forms, and the procedure process, is available online at http://www.dol.gov/odep/pubs/fact/wotc.htm
To get IRS Form 8850, the Work Opportunity and Welfare-to-Work Tax Credits Pre-Screening Notice and Certification Request, and instructions, download from http://www.irs.ustreas.gov/
An overview of the program can be found at http://workforcesecurity.doleta.gov/employ/wotcdata.asp
In March, new legislation extended the tax credit through the end of 2003, due in part to efforts of the WOTC Coalition, which continues to seek a permanent extension of the tax credit. For more on the Coalition's activities information, contact Paul E. Suplizio at wotc@cox.rr.com.