Targeted Groups That Qualify an Employer for the Tax Credit
For the employer to claim the WOTC for a new hire, the employee must be certified as a member of a targeted group by meeting the criteria described in any of the 12 groups listed below. The employer is not expected to verify eligibility of the employee at time of hire.
(Group 1) Short-term Temporary Assistance for Needy Families Recipient (TANF)*:
A member of a family that has received Temporary Assistance for Needy Families (AFDC/TANF) for any nine months within the last 18 months ending on the hire dates.
(Group 2) Qualified Veteran:
(a) member of a family that received food stamps for at least a 3-month period during the 15-month period ending on the hiring date; or (b) a disabled veteran entitled to compensation for a service-connected disability hired within one year of discharge or release from active duty or who has been unemployed for at least 6 of the last 12 months prior to the hiring date.
(Group 3) Qualified Ex-felon:
individual convicted of a felony and who is hired within one year after the conviction or release date from a correctional facility.
(Group 4) Designated Community Resident (DCR):
individual who is age 18 but not yet 40 years old on the hire date and who lives within an Empowerment Zone (EZ) or a Rural Renewal County (RRC).
(Group 5) Vocational Rehabilitation Referral:
individual with a physical or mental disability referred to an employer upon completion of (or while receiving) rehabilitation services by an agency approved by the State, by an employment network under the Ticket-to-Work Program, or by the Department of Veterans Affairs, and with a written employment plan.
(Group 6) Summer Youth Employee:
Youth between 16 and 17 years old, employed between May 1 and September 15, who live in an Empowerment Zone or Enterprise Community (EZECs).
(Group 7) Food Stamp Recipient*:
individual who is age 18 but not yet 40 as of the hire date and a member of a family that received food stamps for either the 6-month period ending on the hiring date, or for at least 3 of the 5 months ending on the hiring date in the case of a family member who ceased to be eligible for such assistance and is an able-bodied adult without dependents.
(Group 8) Supplemental Security Income (SSI) Recipient:
individual who has received SSI benefits for any month ending during the past 60-day period ending on the hiring date.
(Group 9) Long-term Family Assistance Recipient (TANF)*:
member of a family that received AFDC/TANF benefits (a) for at least 18 consecutive months ending on the hiring date, or (b) member of a family that received AFDC/TANF for any 18 months beginning after August 5, 1997, and the earliest 18-month period, beginning after August 5, 1997, ended during the past 2 years, or (c) whose family stopped being eligible for AFDC/TANF because Federal or state law limited the maximum time those payments could be made, and the individual is hired not more than 2 years after eligibility expired.
(Group 10) Hurricane Katrina employee
(Group 11) Unemployed Veteran**:
A veteran hired after 2008 and before 2011 who has been discharged or released from active duty in the U.S. Armed Forces at any time during the 5-year period ending on the hiring date, and received unemployment compensation under state or federal law for at least 4 weeks during the 1-year period ending on the hiring date.
(Group 12) Disconnected Youth**:
An individual hired after 2008 and before 2011 who is at least age 16 but not yet 25 on the hiring date, and during the past 6 months, has not attended or has not regularly attended any secondary, technical, or post-secondary school for more than an average of 10 hours per week, not counting periods during which the school was closed for scheduled vacations, and during the past 6 months, if employed during each consecutive 3-month period within the past 6 months, earned an amount less than he or she would have earned working for the applicable minimum wage 30 hours every week during the 3-month period, and does not have a certificate of graduation from a secondary school or a General Education Development (GED) certificate or has a certificate that was awarded at least 6 months ago and he or she has not held a job or been admitted to a technical or post-secondary school since receiving the certificate.
*The individual need not receive the assistance for the entire period if the family received it for the entire period and the individual was on the grant and thus received
**Groups 11 and 12 were added to the WOTC upon enactment of the American Recovery and Reinvestment Act in February 2009. The tax credit applies only to eligible individuals with job start dates in 2009 and 2010. The 28-day filing deadline is waived for individuals in these two targeted groups who started work during the period of January 1, 2009 through September 16, 2009. The Form 8850 must be postmarked no later than October 17, 2009, for the employer’s application to be considered timely. For individuals in these two groups who start work after September 16, 2009, the normal 28-day filing deadline is in effect.