As of January 1, 2026, the Work Opportunity Tax Credit (WOTC) officially entered a legislative hiatus. This federal hiring incentive, used by thousands of employers to reduce tax liability while supporting the employment of individuals from designated target groups, is currently awaiting renewal by Congress.
While this might sound alarming, it’s not the first time WOTC has lapsed. Historically, WOTC has been renewed retroactively multiple times and continues to receive bipartisan support. A new bill is already on the table with proposed enhancements, including expanded target groups and increased credit amounts.
At MJA & Associates, we’re not waiting on legislation to resume our work. We’re helping employers take action now.
What Is the Work Opportunity Tax Credit?
The Work Opportunity Tax Credit provides federal tax credits ranging from $2,400 to $9,600 per eligible new hire. The credit applies to employers who hire individuals from target groups that face barriers to employment, such as:
- SNAP recipients
- Military veterans
- Long-term unemployed individuals
The WOTC program helps organizations improve profitability, enhance community impact, and strengthen their hiring strategy. But many employers don’t realize that capturing these credits requires more than a checkbox during onboarding.
Why High-Turnover Employers Need a Specialized Approach
Employers with high-volume, hourly-wage workforces, such as staffing agencies, hospitality, and manufacturing, stand to benefit significantly from WOTC. However, they also face unique challenges:
- Time-consuming paperwork: Screening, collecting documentation, and filing forms is a heavy administrative lift.
- Missed credits due to gaps in documentation: Many applications fall through the cracks without proper verification.
- Inadequate systems from ATS or payroll vendors: These tools often screen but don’t convert applications into certified credits.
MJA & Associates offers full-service, contingency-based WOTC processing. We handle the documentation, manage the deadlines, and deliver the tax savings, so your team doesn’t have to.
What Employers Should Do During the 2026 Hiatus
Even though final certifications are temporarily paused, WOTC screening and submission should continue without interruption.
Here’s why:
- The 28-Day Rule remains in effect. Employers must still submit IRS Form 8850 and ETA Form 9061 within 28 days of each new hire’s start date.
- States are still accepting applications. Many are reviewing documentation, issuing “needs” letters, and validating submissions now to prepare for a potential retroactive renewal.
- Stopping now means a lost opportunity. If you don’t file on time and WOTC is renewed later, you may permanently lose eligibility for those credits.
At MJA, we’ve worked through past WOTC expirations, and we’re actively guiding our clients through this one with zero disruption to their tax credit strategy.
The MJA Advantage: Strategic, Personalized Support
Many companies think they’re capturing WOTC credits because they use a checkbox system. But in reality, they’re leaving significant money on the table. Why?
- Incomplete forms.
- Missing supporting documents.
- No follow-through with state agencies.
When MJA & Associates steps in, we typically increase our clients’ WOTC results by 2–3x in the first year. We work directly with your team to:
- Identify eligible hires.
- Collect necessary documentation.
- Ensure every qualified hire is submitted, verified, and certified.
And we do it all on a contingency basis. You don’t pay unless we deliver.
Prepare Today, Benefit Tomorrow
Whether WOTC is renewed next quarter or next year, one thing is clear: employers who continue submitting during the hiatus will be the ones who benefit when legislation passes.
Now is the time to review your WOTC strategy, strengthen your documentation process, and partner with a team that specializes in tax credit recovery.
Let MJA & Associates help you maximize every opportunity.
