Tax Credit For Hiring Program

How Tax Credits Work

If you are a "for-profit" employer in Massachusetts, you may be eligible for a federal tax credit through the Work Opportunity Tax Credit program. There are nine targeted groups. Individuals must be identified as members of one of these targeted groups before a job offer is made.

The Work Opportunity Tax Credit (WOTC) program has two purposes:

• To help individuals who qualify as members of a target group to get a job, and
• To help employers who hire qualified individuals by giving them a credit on their federal taxes.

Target Groups

• A member of a family that is receiving or has received Transitional Aid to Families with Dependent Children (TAFDC) benefits or Temporary Assistance to Needy Families (TANF) for any 9 months during the 18-month period that ends on the hiring date.
• A veteran who is a member of a family that is receiving or has recently received food stamps and certain qualified disabled veterans.
• A recently released ex-felon.
• An 18 to 39 year old resident of one of the 105 federally designated Empowerment Zone/Renewal Communities.
• A vocational rehabilitation referral who completed or is completing rehabilitative services from the Commonwealth of Massachusetts, an Employment Network, or the U.S. Department of Veterans Services.
• A 16 to 17 year old Empowerment Zone/Renewal Community resident hired between May 1 and September 15 as a Summer Youth Employee.
• An 18 to 39 year old member of a family that is receiving or has recently received food stamps.
• A recipient of Supplemental Security Income (SSI) benefits.
• A long term family assistance recipient.

Amount of the Credit

The WOTC credit can potentially be as much as:

• $2,400 for each new adult hire;
• $4,800 for each new disabled veteran hire;
• $1,200 for each new summer youth hire; and
• $9,000 for each new long-term family assistance recipient hired (this is claimed over a two-year retention period)

Employment Duration

The person hired must be employed for at least 120 hours.

Cooperating Agencies

If you want to hire a member of one of the targeted groups, you may want to contact one of these agencies:

Department of Developmental Services
Department of Transitional Assistance
Department of Mental Retardation
Massachusetts Rehabilitation Commission
Department of Correction
Commission for the Blind
Commission for the Deaf and Hard of Hearing
Department of Veterans Services 

Application Process

The first step is pre-screening to determine eligibility. The jobseeker or the employer must complete the following forms:

• Individual Characteristics Form Work Opportunity and Welfare-to-Work Tax Credit ETA 9061 
• Certification Welfare Opportunity and Welfare-to-Work Tax Credits 9062 
• Pre-Screening Notice and Certification Request for Welfare Opportunity and Welfare-to-Work Credits Form 8850 .  Instructions for completing Form 8850  are provided.

The employer and the jobseeker must sign the Form 8850, under penalty of perjury, attesting that the jobseeker is a member of a target group. The employer then sends the forms to the Division of Career Services postmarked no later than the 28th day after the jobseeker begins work.

Mail the Form 8850 with the ETA 9061or 9062 attached to:

Work Opportunity Tax Credit Unit
Division of Career Services
19 Staniford Street
Boston, MA  02114
Telephone: 617-626-5353