Good news from the state of Nevada for employers anxious to hire and get paid for doing it. The state has taken the initiative to improve its process for handling the federal Work Opportunity Tax Credit (WOTC), which provides tax incentives for employers to hire from specific groups of individuals targeted by the federal program, such as military veterans and the long-term unemployed.
This is positive news for employers in the Silver State who may have seen less than stellar results if they had tried to participate in WOTC previously. The state of Nevada has the largest backlog of unprocessed IRS Forms 8850, the form used to submit a request for WOTC certification to the State Workforce Agency (SWA). Some of the unprocessed Forms 8850 were submitted in 2013.
That’s all about to change, however, thanks to the implementation of an electronic process for form submissions. Currently, 30 states have some sort of automated process for WOTC in place, including Alabama, Alaska, Arizona, Arkansas, California, Colorado, Florida, Georgia, Illinois, Iowa, Kansas, Kentucky, Louisiana, Maryland, Michigan, Minnesota, Missouri, New Jersey, New Mexico, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia, and Washington. Check with the applicable State Workforce Agency for the states in which your business operates to learn how you can work with your state to take advantage of WOTC.
In an interview with Nevada’s Public Information Officer for the Department of Employment, Training, and Rehabilitation, Rosa Mendez, Ms. Mendez discussed the goals, challenges, and reasons for fully migrating to an electronic system. Here are some of the highlights:
What is the goal of making the move to a digital process?
Nevada’s goal in moving to an automated system is to process WOTC applications in a timely and efficient manner for the state’s businesses. The backlog is Nevada’s top and first priority. We are working closely with businesses and/or their consultants to import their backlog into the system for processing.
How will it help the state’s businesses?
The implementation of the automated system will allow businesses the opportunity to submit, review and receive determinations for WOTC applications. Businesses will have the ability to submit all necessary forms and documentation for processing. They will also be able to review and check the status of all submitted applications. Once a determination has been issued, they will have access to the determination immediately.
What were some of the challenges?
The biggest challenge has been in assisting in the development of the automated system while maintaining our current manual process.
How do you think it will make it easier for businesses to get WOTC certifications?
The automated system has interfaces and an auto-determination process for select target groups that will make it easier and quicker to receive certifications. Certifications can be viewed and printed in the automated system by the business.
It will be interesting to see how quickly Nevada’s move to an electronic WOTC process will encourage an increase in WOTC certification requests. Tennessee also moved to an electronic process for WOTC and saw an immediate payoff, issuing more than $215 million in Work Opportunity Tax Credits (WOTC) to employers in the first six months of 2017.
If you aren’t already taking advantage of the WOTC program today and you have operations in Nevada, now may be a good time to start.
Employers who are going to take advantage of the tremendous benefits offered by WOTC may want to consider using an all-in-one service, like TaxAdvantage, to assist with required record keeping of information on job applicants and employees. Storing the information for WOTC candidates in a centralized location will make for easy submission to the relevant state workforce agencies. Employers really looking to maximize their WOTC capture should consider combining their automated HR solution with the use of a call center. Some employers have reported a five-fold increase in credit certifications with this power combo.