The work opportunity tax credit

The Work Opportunity Tax Credit is a program set up by the federal government as an incentive for employers to hire disadvantaged groups of individuals who have a hard time finding work. This employer tax credit can help an ex-offender to get hired. Using tax credits will help both the employer and yourself once you make this fact known to the prospective employer.

How does the ex-offender use the tax credit to their advantage? Once you are sure you qualify to use the tax credit to get hired, your ex-offender status becomes a tax break for any employer by you simply telling them about it and having them fill out the required paperwork when you are hired.

How much is the employer tax credit worth? Here are the guidelines:

  • ,400 for each new hired adult
  • ,000 for each new long-term family assistance recipient hired during a two year period

The qualification for an ex-offender to use the tax credit to get hired is simple. You must be convicted of a felony and have a hiring date within one year of being convicted or released from prison.

There is a minimum employment and retention period you should be aware of. In order for an ex-offender to use the tax credit to get hired, they must first work a minimum of 120 - 400 hours before the employer can use the tax credit. The tax credit for employers is set at 25% of the qualified first year earnings for people employed in the 120 - 400 hour range and up to 40% for people over 400 hours.

What benefits should you as an ex-offender sell to the employer to use the tax credit to get hired?

  • The main benefit is the amount of money they receive by hiring you to work
  • The main benefit to you, which you stress to the employer, is that you will have a paying job to support yourself
  • The benefit to both you and the employer will be that you will be a worthy employee for 4 - 10 weeks which is the minimum to take advantage of this program
  • Stress to the employer the fact that you will work hard during this time to remain employed by them after the tax credit is filed thereby making more money for both of you
  • If you are willing to show a real willingness to work, do any of the following to help the process along:

    • Have a copy of the paperwork available at the interview
    • Have the address or location of the nearest Department of Labor office, or their website written down
    • Offer to get the information to the employer

    While this may seem overly eager to get hired, using the tax credit as an ex-offender is an effective way to get into a paying job. If you show the employer how the tax credit can help both them and yourself gain financially, it will show three things to the employer:

    • You are willing to put effort into finding work
    • You are thinking of benefits to the employer
    • You will do what it takes to be a responsible individual