Tax credit saves Tenn. employers millions

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The Workforce Services Division of the Tennessee Department of Labor and Workforce Development is on track to issue a record number of Work Opportunity Tax Credits to employers across the state.

Through the end of October, the Department issued 71,336 Tax Credit certifications. Those certifications represent potential tax savings to Tennessee employers of more than $159 million.

“This tax credit can really impact the bottom line of an employer, while helping an individual who is struggling to find meaningful employment. It is a win-win situation for everyone,” said Labor and Workforce Development Commissioner Burns Phillips.

The state is on track to issue between 95,000 and 100,000 certifications during this calendar year, which would equate to more than $212 million in potential tax savings for employers across Tennessee.

The Work Opportunity Tax Credit program is designed to assist Tennesseans from certain targeted groups who have consistently faced significant employment barriers with re-entering the labor force.

The program provides federal tax credit incentives ranging from $1,200 to $9,600 to employers for hiring long-term unemployed, veterans, SNAP recipients, ex-felons, persons in vocational rehabilitation, Social Security Insurance recipients, Temporary Assistance for Needy Families recipients, as well as several other groups.

“This program has made a tremendous impact on Tennessee. WOTC helps targeted workers move from economic dependency, into self-sufficiency, by earning a steady income and become contributing taxpayers. Participating employers simultaneously reduce their income tax liability, making it easier to do business,” Phillips said.

The process for employers to apply for the Tax Credit program was transitioned to an online application that speeds up the approval process and eliminates the use of more than 700,000 pieces of paper each year.