Tax Incentives

Adult Career and Continuing Education Services-Vocational Rehabilitation

Tax Incentives

Work Opportunity Tax Credit (WOTC)

All employees who have received ACCES-VR services within the past two (2) years prior to the hire date, are eligible.  Partial Credit of 35% becomes available after the employee has worked 120 hours.  Full credit is given after 400 hours of employment.  Summer youth who are residents of federally designated communities, must also work a minimum of 120 hours as well.

The tax credit is up to 40% of the employee’s first $6,000 in wages, to a maximum of $2,400.

Workers With Disabilities Employment Tax Credit (WETC)

All individuals who are eligible for ACCES-VR services and who work on a full-time basis for at least 180 days or 400 hours during the second (2nd) of employment. Employers are eligible for WETC independent of WOTC.

The tax credit is up to 35% of the employee’s first $6,000 in wages during 2nd year of employment up to a maximum of $2,100.  Employers are eligible for WETC independent of WOTC. In this case, the WETC credit can be used as a second year credit only.

Long – Term Family Assistance (LTFA)

Employers who hire WOTC-qualified employees are eligible for one of three possible federal tax credits. Employees must have started work during the period from October 1, 1997 through December 31, 2007; must be certified eligible for WOTC; and must perform a minimum of 120 hours of service in order to generate a tax credit for their employers.

The three possible tax credits are:

  • The full rate – A credit equal to 40% of the first $6,000 in qualified first year wages, for a maximum credit of $2,400. The WOTC-certified employee must work a minimum of 400 hours for the employer.
  • The Reduced LTFA Rate –A credit equal to 25% of the first $10,000 of the first year or second year wages can generate an up to $2,500 of each of the two years. The WOTC-LTFA certified employee must perform at least 120 hours, but less than 400 hours, of service for the employer.
  • The summer youth rate – A credit of 40% of the first $3,000 in any 90-day period between May 1 and September 15 for a maximum credit of $750. The employee, certified as a Summer Youth, must work at least 120 hours for the employer.

Disabled Access Tax Credit

An employer with fewer than 30 employees OR no more than $1 million in gross receipts in the preceding year.  Eligible expenses include the removal of barriers—architectural, communication, or transportation—including modification of equipment and the use of interpreters, taped text, or alternative format for communication.

The tax credit is up to 50% of “eligible access expenditures” that exceed $250 but do not exceed $10,250 for a taxable year.  A business may take the credit each year that it makes an eligible barrier removal or service provision.

Architectural Transportation Barrier Removal Deduction

An employer who removes barriers to the workplace to make it more accessible and usable by individuals with disabilities.

The deduction is up to $15,000 per tax year.

Last Updated: February 23, 2011


Tax Breaks for Hiring Veterans and Veterans with Disabilities:

New – Tax Break for Employers Who Hire Veterans: $2,400, $5,600 or $9,600 “VOW To Hire Heroes Act”

(Source – Businesses will receive special tax credits for hiring veterans, under a new law signed by President Barack Obama on Monday, the single carve-out measure of his jobs proposal.

Under the law, the “Returning Heroes Tax Credit,” businesses that hire veterans will receive a $2,400 per veteran tax credit for veterans unemployed for four weeks or longer and a $5,600 per veteran credit for hiring veterans unemployed for more than six months.

Under the “Wounded Warriors Tax Credit,” businesses could get up to $9,600 per disabled veteran hired if the veteran was unemployed longer than six months and has a service-related injury.

Obama said that 850,000 veterans are unemployed in American.

“Unemployment for veterans of Iraq and Afghanistan continued to rise, and that isn’t right,” Obama said, flanked by a bipartisan group of lawmakers. “These men and women are the best that America has to offer. They are some of the most highly trained, highly educated, highly skilled workers that we have.

“If they can save lives on the battlefield, then they can save a life in an ambulance. If they can manage convoys moving tons of equipment over dangerous terrain, they can manage a company’s supply chain. If they can track millions of dollars of assets in Iraq, they can balance the books of any company here in the United States,” he added.

“Today, because Democrats and Republicans came together, I’m proud to sign those proposals into law, and I urge every business owner out there who’s hiring to hire a veteran right away,” Obama said.

House Speaker John Boehner (R-Ohio) praised the president for signing the legislation, but called on him to work with Republicans on other legislation the GOP House has passed this year.

“America owes it to our men and women in uniform to ensure they come home to a strong economy,” Boehner said. “By preventing the IRS from imposing a job-crushing withholding tax on job creators and breaking down the bureaucratic barriers that are keeping veterans from finding work, we’re creating a better economic environment for families, small businesses, and service members alike.