Can Employers Ask the Tax Credit Questionnaire?

When you apply for a new job, your employer may ask you to fill out a tax credit questionnaire on IRS Form 8850, Employment Training Administration Form 9061, and ETA Form 9062. This is so your employer can take the Work Opportunity Tax Credit.

They are allowed to ask you to fill out these forms.

This post is provided for general information only. Please confirm the details and circumstances of your unique situation with your tax accountant or other appropriate advisor before taking action.

What is the Work Opportunity Tax Credit?

The Work Opportunity Tax Credit reimburses employers for part of a new employee’s wages in their first year of work. It applies when employees are in targeted groups such as being on long-term unemployment, receiving other government benefits, or being an ex-felon.

Employees don’t receive the Work Opportunity Tax Credit on their own tax return.

Do employers legally have to submit the tax credit questionnaire?

The tax credit questionnaire is not a mandatory IRS or Department of Labor requirement. Employers can hire employees without having them fill out the questionnaire. However, employers aren’t eligible for the tax credit if they don’t collect these forms.

Can employers give hiring preference to employees who qualify for the Work Opportunity Tax Credit?

Yes, employees can collect the questionnaire during the hiring process and choose to hire employees who qualify for the tax credit. The tax credit’s purpose is to encourage employers to hire these employees.

What happens if I don’t fill out the WOTC forms?

If you refuse to fill out the WOTC forms during the application process, the employer may choose not to hire you. If you don’t fill out the forms after being hired, your employer may take disciplinary action.

In some states, some of the groups targeted for the Work Opportunity Tax Credit may be protected classes. While IRS tax credits are part of federal law and generally override state law, you should consult with a local employment lawyer if you believe you’ve been wrongfully denied employment or had other action taken against you.

Returning from a period of unemployment?

If you’re returning to work after a period of unemployment, find out how to handle your unemployment taxes on your tax return.

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