Green Corporation hires six individuals on January 4, 2015, all of whom qualify
ID: 2448873 • Letter: G
Question
Green Corporation hires six individuals on January 4, 2015, all of whom qualify for the work opportunity credit. Three of these individuals receive wages of $8,500 during 2015, and each individual works more than 400 hours during the year. The other three individuals each work 300 hours and receive wages of $5,000 during the year.
a. The amount of Green's work opportunity tax credit for 2015 is $______.
b. If Green pays total wages of $140,000 to its employees during the year, how much of this amount can Green deduct, assuming that the work opportunity credit is taken? $______.
Explanation / Answer
Answer a)
The legislative changes under the Tax Increase Prevention Act of 2014, retroactively allow taxable employers to claim the Work Opportunity Tax Credit (WOTC) for all of the targeted group employee categories listed on Form 5884, if they began work after Dec. 31, 2013, and before Jan. 1, 2015.
So, green Co. had hired the workers on Jan 4, 2015 i.e. agter Jan 1, 2015, so company cannot claim work oppourtunity tax credit in 2015.
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