n-15-13.pdf

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Notice 2015-13
Work Opportunity Tax Credit (WOTC) Extension for 2014
I. PURPOSE
This notice provides guidance on § 119 of the Tax Increase Prevention Act of
2014 (the Act), Pub. L. No. 113-295, enacted on December 19, 2014, and transition
relief for employers claiming the Work Opportunity Tax Credit (WOTC) under §§ 51 and
3111(e) of the Internal Revenue Code, as extended by the Act. Section 119 of the Act
amends § 51 to extend the WOTC, including the reduced credit under § 3111(e) for
qualified tax-exempt organizations, through December 31, 2014. Specifically, this
notice provides employers that hire members of targeted groups additional time beyond
the 28-day deadline in § 51(d)(13) for submitting Form 8850, Pre-Screening Notice and
Certification Request for the Work Opportunity Credit, to Designated Local Agencies
(DLAs).
II. BACKGROUND
Section 51 provides the WOTC for employers that hire individuals who are
members of targeted groups. Before an employer may claim the WOTC, the employer
must obtain certification that the hired individual is a targeted group member.
Certification of an individual's targeted group status is obtained from a DLA. A DLA is a
State employment security agency established in accordance with 29 U.S.C. §§ 49-49n.
An employer must submit Form 8850 to the DLA not later than the 28th day after the
individual begins work for the employer.
The Returning Heroes and Wounded Warriors Work Opportunity Tax Credits,
contained in § 261 of the VOW to Hire Heroes Act of 2011, Pub. L. No. 112-056 (the

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VOW Act), amended § 51 to extend and expand the WOTC to employers hiring certain
qualified veterans (as defined in § 51(d)(3)). The VOW Act also amended §§ 52 and
3111 to make a reduced WOTC available to organizations described in § 501(c) and
exempt from taxation under § 501(a) (qualified tax-exempt organizations) as a credit
against the employer share of social security tax imposed under § 3111(a) for qualified
tax-exempt organizations hiring qualified veterans. The American Taxpayer Relief Act of
2012, Pub. L. No. 112-240 (ATRA), enacted on January 3, 2013, extended the WOTC
for certain taxpayers through December 31, 2013. For guidance on changes made to
the WOTC by the VOW Act and ATRA, see Notice 2012-13, 2012-9 I.R.B. 421, and
Notice 2013-14, 2013-13 I.R.B. 712, respectively.
III. TRANSITION RELIEF
Section 51(d)(13)(A) provides that an individual is not treated as a member of a
targeted group unless (1) on or before the day the individual begins work, the employer
obtains certification from the DLA that the individual is a member of a targeted group; or
(2) the employer completes a pre-screening notice (Form 8850) on or before the day the
individual is offered employment and submits such notice to the DLA to request
certification not later than 28 days after the individual begins work. Because the Act
extended the WOTC retroactively for 2014 for members of targeted groups, employers
need additional time to comply with the requirements of § 51(d)(13)(A). Accordingly, a
taxable employer that hired a member of a targeted group (as defined in §§ 51(d)(2)
through (10)), or a qualified tax-exempt organization that hired a qualified veteran
described in § 51(d)(3), on or after January 1, 2014, and before January 1, 2015, will be
considered to have satisfied the requirements of § 51(d)(13)(A)(ii) if it submits the

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completed Form 8850 to the appropriate DLA to request certification not later than April
30, 2015. A timely request for certification does not eliminate the need for the employer
to receive a certification before claiming the credit.
DRAFTING INFORMATION
The principal author of this notice is Shoshanna Tanner of the Office of the
Associate Chief Counsel (Tax Exempt and Government Entities). For further information
regarding the WOTC, contact Ms. Tanner at (202) 317-5500 (not a toll-free number).