Senate Introduces “Improve and Enhance the Work Opportunity Tax Credit Act” Bill  

Senator Bill Cassidy, with the support of a bipartisan group, introduced S.492, or the “Improve and Enhance the Work Opportunity Tax Credit Act,” designed to strengthen the Work Opportunity Tax Credit (WOTC). This bill is aligned with the previously introduced House Bill H.R. 1177, furthering Congress’ intention to codify needed modernization and extensions to WOTC.

This new bill proposes significant changes, including extending WOTC for five years, bringing the new deadline to December 31, 2030. Congress is also proposing an increase in the credit percentage, from 40% to 50% of qualified wages. To incentivize employee retention, the new bill expands the credit to account for employees who work 400 or more hours. Congress also recognizes the need to expand and account for a changing workforce. As a result, S.492 also accounts for inflation, eliminates the age cap at which Supplemental Nutrition Assistance Program (“SNAP”) recipients are eligible for WOTC, and even adds a new eligibility category for qualified military spouses.

While these changes are not yet in effect, this is a much-needed step to ensure that the critical benefits the WOTC program provides remain for American businesses.