Tax Credits for Hiring Qualified Candidates?

Claudia

 Did you know that hiring certain qualified applicants can also come with a financial incentive?  I’m talking about individuals with disabilities and those with other barriers to employment. These are individuals that meet your business need and show great potential for your company. Besides making a good employee they can also provide your company with some financial incentives.

The Work Opportunity Tax Credit (WOTC) is a federal business income tax savings. According to Texas Workforce Commission, WOTC can represent a direct savings to a business ranging from $1,200 to $9,000 per qualifying employee.  Businesses must hire from one of the 12 select groups of eligible workers which include; veterans and veterans with disabilities, vocational rehabilitation referrals (for example customers receiving DARS services), Social Security income recipients, and summer youth employees. For a complete list refer to “Employer Incentives and Tax Credits” located on the Texas Workforce Commission website.

This is a great incentive for large and small companies hiring qualified candidates with disabilities and other barriers. While there is a time frame to get the forms completed and approved by Texas Workforce Commission, you are looking at a credit of $2,400 per qualified individual. Hiring a disabled veteran receiving vocational rehabilitation services can qualify you for a tax credit of up to $4,800.

 Some employers may face some questions on how to accommodate the new employee due to their disability.  A financial resource that can help in this modification is the Small Business Tax Credit. With this credit small businesses may take an annual tax credit for making their businesses accessible to people with disabilities.  Some examples of qualifying expenses include:

  • sign language interpreters for the hearing impaired;
  • readers for those who have visual impairments;
  • adaptive equipment or the modification of equipment;
  • print materials in accessible formats (e.g., Braille, large print);
  • fees for consulting services (under certain circumstances);
  • barrier removal in buildings or vehicles, increasing accessibility to people with disabilities.

According to the Architectural/Transportation Tax Deduction: IRS Code Section 190, Barrier Removal businesses may take an annual deduction for expenses incurred to remove physical, structural, and transportation barriers for persons with disabilities. This would include providing accessible parking spaces, ramps, and curb cuts; providing telephones, water fountains, and restrooms that are accessible to persons using wheelchairs; and making walkways at least 48 inches wide and providing accessible entrances to buildings including stairs and floors.

Your business can take advantage of these financial incentives while gaining qualified and productive employees. A Workforce Solutions’ Business Services team member can provide you with additional information on tax credits and resources. Contact your business consultant at a local office for additional information or visit the direct link on the IRS website for additional information.

Claudia Magallan is the Disability Navigator for Workforce Solutions Workforce Solutions- Gulf Coast ensuring that customers with disabilities utilize all the services offered by Workforce Solutions. She has over 5 years of experience building relationships in the Houston Community and working with job seekers with barriers to employment.

 



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